Expressway costs up again
May 30, 2006

The final major contract for the Red Hill Expressway will cost the city about $4 million more than budgetted for last summer. Project director Chris Murray verbally revealed the extra cost under questioning yesterday at a meeting of council's expressway implementation committee and promised a full report soon on the project's costs.

Murray told the committee that LaFarge Canada's $31 million bid was the lowest received, but initially he played down its significance. "The situation is not so much an overall budget situation as it is a cash flow situation," Murray explained, noting that contingency funds not spent on other parts of the project have yet to be collected, and the provincial Ministry of Transportation also owes the city money for expropriated lands, "and those dollars can roll back into the completion of this project".

Chad Collins asked if this meant the expected costs were over, under or about even. Murray responded that "we're still calculating but we're pretty close to the mark".

Collins pressed for more details. "Are you saying then Chris, that we're short on that in terms of what we set aside for 2006, but in the grand scheme of things we're still on track?" Murray replied "essentially" and went on to say he's still aiming to keep the total cost at the current budget of $429 million for the city portion of the expressway project.

Dave Braden's subsequent direct question on the actual projections for paving costs extracted more detail from Murray who admitted that "the budget here is about $4 million higher than what we thought we'd come at when we looked at it last summer."

The other bid on the paving contract came in at $37.5 million from Aecon. Dufferin Construction also responded to the tender, but the city's website lists their bid at $0.00 suggesting that perhaps it was disqualified.

Murray pointed to higher petroleum prices as the main cause of the increase, leading Braden to joke that perhaps the city should wait. "We all know the price of energy's too high, right, and it's going to come down," Braden quipped. "I think we should just wait a bit and there's going to be some real steals."

The costs of the valley expressway have climbed about $30 million since construction began in 2003, not counting the final impact of the higher paving costs revealed yesterday.