Whitehorse city council is being asked to pay an Ontario company $2.15 million to design and supervise the construction of the proposed new municipal operations building.
The issue came up at Monday’s council meeting when city staff revealed the lowest bidder for the project.
But at least one councillor is questioning whether the city has enough information to move forward.
Council is being asked to award the contract to the Toronto-based firm RDHA. It’s expected to make a decision next week.
RDHA’s bid was the cheapest of the five that were considered, about $100,000 less than its closest competition.
Shannon Clohosey, manager of environmental sustainability, said all the subcontractors proposed to work on the design under RDHA have local offices in Whitehorse.
Coun. Dan Boyd said he “fully supports” replacing the city’s existing municipal services building but questioned whether they were rushing ahead with plans without knowing how they would pay for the project.
“If this was you personally doing this, you wouldn’t do it this way. You wouldn’t spend a whole bunch of money designing a house that you don’t know how you’re going to pay for,” he said.
“You would figure out how you’re going to pay for it, you’d get your bank financing in place before you proceeded to do that.”
The new operations building would stand at the top of Two Mile Hill by the public safety building. It would replace the 50-year-old municipal services building with something much more energy efficient and also consolidate more services under one roof.
The operations building will be home to transportation, equipment maintenance, engineering, traffic, environmental sustainability, water and waste, as well as some human resources staff, city staff have said.
The price tag has been pegged at $47 million. About $44 million of that is for the construction alone.
The City is getting about $15 million in federal gas tax funds for the building, meaning it’ll have to come up with $32 million from somewhere else.
The plan has always been to use gas tax money, the city reserves and borrow some cash, city manager Christine Smith told council.
Boyd said he wants a better sense of how much the City will be borrowing to make ends meet.
Smith said she’s “very close” to knowing exactly how much is in the city reserves once the year-end accounting is done.
Members of council have suggested there may be money to be had from the territorial and federal governments.
Mayor Dan Curtis said getting this plan done is important so that they have something concrete to show possible funders.
“What we can’t afford to do is wait in perpetuity,” he said.
Coun. Rob Fendrick compared the conundrum to a “chicken-and-egg” situation. The design and the price will inform financing options, he said.
Council wants to “know as soon as possible what the financing is going to look like and what that’s going to mean in terms of capital, the funding sources for the capital and if there will be any operating impacts as a result of the design,” he said.
Coun. Jocelyn Curteanu pointed out that the current low interest rates work in the city’s favour. Waiting means risking that those interest rates go up and make the project unaffordable, she said.
“We desperately need that design because until we get that design we really don’t know what it’s going to cost,” said Coun. Betty Irwin.
“Tell them to hurry. Get this to us as soon as possible.”
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