The City of Dawson won’t be running its much-criticized and often malfunctioning water treatment plant.
Despite plans for the town to eventually take over the facility, the territorial government announced Tuesday afternoon that it will be the one that owns and operates the plant.
Dawson will now pay the Yukon government a service fee.
“(The city has) expressed significant concerns about taking this on,” said Community Services Minister Currie Dixon.
“It’s a very large, very challenging and complex piece of infrastructure and ultimately we decided that because we have better resources and better capacity to deal with it we determined that Yukon government was better positioned to own and operate the plant than the town of Dawson.”
The facility began operations in the fall of 2012, and the plan was to hand it over to the town a year later.
But Corix, the contractor, had to keep managing the place long afterwards because it could not meet the conditions of the contract.
As of February 2015, the plant finally had three straight months of testing that passed the requirements for its water licence.
That triggered the beginning of a two-year warranty period. Corix will run the plant until 2017.
Dawson Mayor Wayne Potoroka said a memorandum of understanding between the town and the territory laid out the conditions that had to exist before Dawson was in a position to take over the facility. Two of those conditions were that the project be affordable and work properly.
The facility still isn’t working as it should be, Dixon admits.
Right now it is meeting the requirements most of the time but having challenges particularly in the summer months, he said.
On top of that it’s costing more than expected.
“It is working but it’s not working as consistently as was planned and it’s not operating at the costs that we had planned,” Dixon said.
“What we’re doing now is trying to get the operations of the plant fine-tuned, get it working better, more consistently and bring the operating costs down.”
When the plant was being designed, costs were estimated at $380,000 a year, said Jennifer Macgillivray, the Department of Community Services’s director of infrastructure. She cautions that the early number did not consider the cost of having an Outside company run things. It also doesn’t include the correct number of staff, she said.
Still, the costs are much higher. Right now the plant costs $94,000 a month to run. That’s more than $1 million annually.
Macgillivray said the government is covering costs for Corix like staff living allowances, flights and other things that wouldn’t be part of the bill if the place was run locally.
“In the future, what we’re looking at doing is our operations branch will run the project,” she said.
“They’re looking at whether they’re going to hire a contractor or hire in-house. That’s going to be far cheaper than hiring a contractor.”
The department is hiring a cost consultant to break down how the money is being spent.
Meanwhile experts at the plant are still trying to figure out what keeps going wrong.
Throughout the winter months the plant has been meeting its requirements, Macgillivray said.
“The summertime operations are more challenging because the sewage strength coming into the plant is much higher.”
Still, it should be working, she said.
The flow metre that measures the volume has been replaced. A handful of valves that were the incorrect type for the plant are being replaced. All of those changes are covered under the warranty.
If things aren’t running properly by the time the warranty runs out in February 2017 the government has various options, Macgillivray said.
“If they haven’t met the terms of their contract, and the plant can’t produce an effluent that meets the requirements of the regulator, then YG will address this with Corix through the terms of the contract.”
That doesn’t necessarily mean court, she said. The contract requires the two sides start with mediation.
Potoroka said his office hadn’t finished crunching the numbers when it comes to how much the town could afford to pay to run the place, but he feels relieved by the territory’s decision.
“I’m feeling appreciative of the Yukon government for helping us out. If they would have walked away this community would be in some hard times, but they didn’t.”
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