Options running dry for Inverhuron water and sewer project

At a special council meeting last night (May 11), councillor Laura Haight, policy chairperson for water and wastewater services, emphasized that the evening's meeting was for information only. The issue will be further discussed at Wednesday's council meeting.

Chief building official Michele Barr told council that the tender for the Inverhuron project was broken down into two contracts. Contract 1 includes the land south of Bruce County Road 15 and the county road; Contract 2 includes the land north of the county road.

Tenders were opened May 4, with two companies bidding for both contracts:

• Omega Contractors Inc. bid $7.068-million for Contract 1, and $8.824-million for Contract 2
• Moorefield Excavating bid $7.37-million for Contract 1, and $8.724-million for Contract 2

The combined total for the lowest tenders is $15.793-million, resulting in a cost of $33,675 per property in the service area.
 

Meanwhile, the estimated cost of the project was $9.115-million, of which Kincardine has been approved for $6.076-million in provincial and federal funding through the Building Canada Fund.

Barr said, given the high price of the tender bids, municipal staff contacted the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) to discuss options of scaling down the project, in order to address the environmental issues that exist in the core area of Inverhuron. OMAFRA will entertain reduced project and review it in a timely manner, but a change would lead to a proportionate reduction in funding.

Already, the municipality has incurred about $1.325-million in expenses and has been reimbursed about $700,000 from OMAFRA.

In addition, said Barr, the Inverhuron Watershed Concerned Citizens Association has applied for a judicial review into the project. The municipality is working with legal counsel and the required actions have been taken – those were to be discussed in a closed session at the end of the meeting.

Bruce Potter of B.M. Ross and Associates, the engineers on the project, said the tender prices are exceptionally high.

"The unit prices astounded us," he said. "We think they're skewed (in comparison to similar projects in recent years). We are dumbfounded by these prices."

Potter offered three options for council to consider:

• Award the project based on the tenders received

• Pursue an initial phase of the project (scaled-down version)

• Take advantage of the value of the work, to date, in completing the Class Environmental Assessment (EA), and pursue other funding opportunities in the future with 'shovel-ready projects' for the area

Potter suggested scaling back the project to complete the area just north of the county road, including Lake Street, Wood Street, John Street, and Victoria Street – the area of most concern for septic systems. Using mitigation measures, such as development charges and sewer reserves, the resulting cost could be $20,505 per lot.

When asked why the bids came in so high, Potter said one reason could be the time constraint on the project – it has to be completed by March, 2016; and secondly, the lack of competition as each bidder was guaranteed one contract or the other because neither wanted to do both.

Mayor Anne Eadie asked how long it would take for the engineers to reconfigure the project.

"About two weeks," said Potter. "Then it would close in five weeks' time. With less work in a similar time frame, you would see better prices."

Haight said council will have to decide Wednesday how to proceed – whether to try and scale down the project or just move on and accept the funding for the EA only.

"How does the initial phase (reduced project) address the areas in need in Inverhuron?" asked deputy mayor Jacqueline Faubert.

"The Lake Street North area has the highest overall risk," said Potter.

Councillor Gordon Campbell asked why council hasn't pushed harder to get this project done, since the grant was approved five years ago.

"There was a lot of push and shove," said Potter.

"Every time we turned around, there was another issue to deal with," added Eadie.

Haight noted that even a scaled-down version of the project would cost between $10-million and $11-million which is more than the grant that was approved. The application would be for a range of possibilities: the large project, the not so large, the small and then the really small, she said, to cover all the bases in order to make an informed decision.

Following a break, Donald Stewart of the Inverhuron Watershed Concerned Citizens Association, made a presentation to council. He said the group wants a project of some sort to proceed, with the grant funding; it must be a reasonable size; cost-effective; and meet the needs of the community of Inverhuron.

"This project is massive and way too expensive," he said, adding that the association is prepared to work with council to establish a steering committee made up of members of the association, the Inverhuron and District Ratepayers' Association and local residents, as well as council and staff. "We have engineers who can look at this project and offer an opinion."

Meanwhile, the association's lawsuit against the municipality is pending, said Stewart, based on the economic impacts of this project. "If council would establish a steering committee and work with us toward approving a reasonable plan, then we would withdraw our application for a judicial review."

Eadie said she was already part of a steering committee regarding this project, and there were members on it from the Inverhuron community.

"I was on that steering committee," said Stewart. "I was astounded to discover that four of seven members were already committed to certain aspects of this project."

Council thanked everyone for providing input. The council debate will continue Wednesday night.