The price of the City of Whitehorse’s new operations building has risen by more than half a million dollars.
City council was presented with a recommendation for the extra spending at its June 17 meeting.
The change would bring Ketza Construction’s contract to build the new 11,567 square metre structure, that will house the operations and transit departments off of Range Road, up to more than $39.7 million.
The amount is still under the original $43 million estimated cost of construction, project manager Wayne Tuck pointed out.
Ketza informed the city last August that the Jan. 31, 2019 completion date would not be met due to design changes and increased work that wasn’t included in the original tender, Tuck said.
It’s now expected the building will open mid-September 2019.
Over the course of construction, there have been about 200 change orders on the project, Tuck said. It would not be unusual to have some changes on such a large project, but as Coun. Dan Boyd described, “we’re substantially over” what’s normal.
RDHA is the firm that won the $2.15 million contract for the design of the building. It has been working directly with Ketza on the issues and not charging for the additional time needed due to issues not addressed in the original design, Tuck said.
Boyd said he was disappointed in the matter, but said any further discussion should happen in-camera. That means those discussions happened in private and the press and the public were excluded.
Under the territory’s Municipal Act, council can go in-camera for specific reasons including matters related to commercial information that could prejudicial to the parties or municipality involved; personnel information; information received in confidence that could be prejudicial to the parties involved or municipality; and to discuss legal proceedings among others.
Coun. Samson Hartland described the situation as “extremely frustrating”.
Ketza originally claimed that the changes would cost more than $691,000.
Meetings with Ketza followed “in an effort to reach an agreement on their claim and to avoid a legal resolution through the courts where the Ketza claim for costs could be higher and the costs for the City, consultant team and the contractor would be much higher,” according to Tuck’s report.
Through those discussions, Ketza and the city agreed to the September completion date with the additional cost amount reached at $540,960, which includes amounts for sub-trades as well.
That amount is also subject to an agreement that there will be no further claims brought forward by Ketza or subcontractors for the project, based on what’s been identified.
Under the agreement, Ketza would confirm the costs include sub-contractor claims, that there’s no additional claims for previous and existing changes and that the payment releases the city of claims, which are or have previously been covered by change orders or submitted by Ketza.
“The overall budget for the Operations Building Project has not been exceeded, and Administration estimates that the project will be under budget even with approval of these additional costs totaling $540,960.55,” Tuck said in his report.
Council will vote on whether to approve the additional money at its June 24 meeting.
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