Government low balled F.H. Collins estimates

The Yukon government knew that the original design for the F.H. Collins school replacement project was likely to cost $43.7 million, not the $38.6 million budget it used to justify cancelling the project.

The Yukon government knew that the original design for the F.H. Collins school replacement project was likely to cost $43.7 million, not the $38.6 million budget it used to justify cancelling the project.

When construction companies bid on the project last winter, the lowest bid – a joint venture between Whitehorse-based Ketza Construction and Ontario’s EllisDon Corp. – was $47.78 million. At the time, Premier Darrell Pasloski said that was almost $10 million over budget. The government cancelled the project and decided instead to import a previously constructed “campus-style” design from Alberta to save money.

“We can do a lot with $10 million,” Pasloski said in March.

But the Ketza/EllisDon bid wasn’t $10 million over budget, at least not according to the professional estimator the government hired to evaluate the project.

Information obtained by the Yukon News through an access-to-information request shows that BTY Group told Highways and Public Works in December 2012 that the project was likely to cost $43.7 million. That price includes a temporary gym, a geothermal heating system, and a five per cent contingency buffer.

“I’m beside myself. This is a cover-up,” said interim Liberal Leader Sandy Silver.

“The premier has misled Yukoners when he said that the government had two separate independent estimators tell him that the project could be built for $38.6 million. He knew that the statement was false when he made it in March.

“We’ve been asking questions about this for six months. Now he needs to explain to Yukoners why he wasn’t honest about these numbers in the first place,” Silver said.

When the News first filed a request for this information in May, it was denied because the government had signed a confidentiality agreement with BTY. The total project estimates were released only after the privacy commissioner brought the issue to mediation.

The NDP’s education critic, Jim Tredger, said this is another case of the Yukon Party continually moving the goal posts on major construction jobs.

“The government continues to make promises that they can’t keep, or that they don’t keep, or that they change,” Tredger said.

“Everything is shrouded in a lack of transparency. The plans change, the numbers shift. I know the contracting community and the construction industry are very frustrated dealing with the government on this,” he said.

Over the past week the News made repeated requests to speak with Education Minister Elaine Taylor, Public Works Minister Wade Istchenko and Premier Darrell Pasloski. Cabinet spokeswoman Elaine Schiman said that it was a departmental matter and it would be inappropriate for the ministers or the premier to comment.

She instead emailed written responses to questions Thursday afternoon.

“The budget for the F.H. Collins construction was $38.6 million, an amount approved by management board,” the statement read.

“This government is committed to bringing the F.H. Collins project in on budget because we are a fiscally-responsible government … We weren’t prepared, in principle, to go back to management board, to ask for additional dollars, especially when the lowest bid came in at $47.78 million,” the statement read.

So how did the government arrive at $38.6 million? Public Works spokeswoman Kendra Black explained that when the project was being developed, Whitehorse-based architecture firm Stantec was commissioned to design the building based on years of public input and consultation. Stantec then hired Hanscomb Limited to come up with a total cost estimate. Highways and Public Works hired its own estimator – BTY – to do the same.

In the spring of 2012, Hanscomb said the school would cost $38.6 million. BTY said it would cost $40.1 million. The government approved the lower number as the budget for construction and put the project out to tender in November 2012, Black said.

But that tender didn’t include a temporary gym or geothermal heating. Under the original plans, the school’s gym would be torn down during construction and the students would spend two years being bused to various Whitehorse locations for phys. ed. classes.

A public outcry ensued, and in December former Education Minister Scott Kent relented, promising to build a temporary gym.

The tenders were called back and the gym was included, along with a request for geothermal heat. Highways and Public Works got another estimate from BTY showing a likely increase of $5.1 million to the project.

But when the bids came back, the department was told to use the original $38.6 million budget to evaluate them, Black said.

“The direction at the time was that we have no more money. As long as it can be managed within the original budget, we would go forward,” she said.

When asked why the Education Department would promise to build a temporary gym that the government had no intention of actually paying for, Schiman replied: “Because we are a fiscally-responsible government, operating within a budget for the F.H. Collins replacement project. We are focused on building a school that meets the needs of Yukon students and families within our approved budget.”

In March, when news of the high bids and the project cancellation broke, EllisDon vice-president Michael Kazda said the project could have been saved if the territory had been willing to negotiate.

“Several million could be saved simply by deleting the geothermal system and changing the school layout to avoid the requirement for a temporary gym,” Kazda told the Whitehorse Star in March.

Under Yukon contracting law, the government is only able to renegotiate the price of bids up to 10 per cent. The bid from Ketza and EllisDon was within 10 per cent the most up-to-date estimate.

Neither Ketza nor EllisDon returned the News’ calls for comment by press time.

What is the plan now? When the decision was made to scrap the original design, the government announced it would import a previously constructed design from Alberta. To do it required paying Barr Ryder Architects $900,000 to adapt the design to Yukon climate standards.

The new project has yet to go to tender, but Schiman said that should happen soon. The project is now expected to be completed by the 2015/16 school year.

Contact Jesse Winter at

jessew@yukon-news.com

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