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Council approves $1M upgrade to main lift station, despite project being far over original budget
Mayor Stu Wells said he “couldn’t sleep at night” if the town had more flooding next spring and he had voted against upgrading the town’s main lift station, despite the initial project being almost a quarter million dollars over the initial budget estimate.
Despite objections from councilors C. J. Rhodes and Michael Ryan, who wanted the project delayed until next spring, Wells received support from councilors Mike Plante and Sue McKortoff to proceed with the million-dollar upgrade starting in the next couple of weeks.
The town’s main lift station is located on Legion Beach. Water lines, some which date back to the 1960s, pump water to the town’s lagoon ponds near the local landfill site.
Ryan supported a motion by Rhodes asking the tender for this project be submitted again in the spring because of the $244,000 budget overrun from the original estimate of $750,000.
However, Wells, McKortoff and Plante voted against that motion and in favour of awarding the renewed tender contract to Cantex-Okanagan Construction from Penticton in the amount of $945,000. All four tenders submitted include a $25,000 contingency allowance and five per cent GST.
Wells said this is too important a project to delay any longer because the original piping from the town’s main lift station were originally installed back in 1963 and they need to be replaced.
Even though the town’s lagoon ponds are well below capacity following several months of concern, there could still be catastrophic consequences if there were major rainfall in town next spring and the main lift station has not been upgraded, said Wells.
Large sections of the downtown core were flooded out during significant rainfall events in late June and early July of 2012 in large part because the main lift station couldn’t handle the enormous amounts of water and old infrastructure was incapable of pumping that water to the storage lagoons, he said.
“I want to be able to sleep at night,” said Wells, saying a major spring storm could cause more severe flooding if the main lift station isn’t upgraded.
In order to pay for this project, staff recommended that the additional $240,000 could be found by delaying the proposed project to disperse effluent from the town’s lagoon ponds to the soccer and ball fields located near Osoyoos Secondary School.
The 2013 capital budget identified the construction of a new sewer main line to the lagoon storage area as a major priority and council approved the $750,000 project as part of its 2013 budget deliberations.
True Consulting, the town’s longtime engineering firm, prepared a report for members of council detailing why this project is significantly over budget.
The biggest reason were optimistic estimating of costs, issues that surfaced in the actual design implementation and having only four companies bid on the contract.
Staff has identified that the entire budget shortfall can be made up through delaying the development of the reclaimed water system at the high school.
Administration had delayed the high school project until approval was given by the board of trustees with School District 53 as it does involve dispersing huge amounts of effluent on property that is used by hundreds of local high school students on a regular basis, says a staff report.
Delaying the high school effluent project until next spring would enable the school board to make a decision and also allow for the release of a long-awaiting sewer capacity assessment report, scheduled to be released in February.
“A second consideration is that delaying until 2014 enables the combining of the entire school and airport reclaimed water line project to be tendered as one project, which may result in better pricing,” says the report.
The consultant report prepared for council indicates original budget unit costs were “significantly underestimated” and the lift station upgrade should have been estimated at $300 per meter instead of $215 in the original budget.
Cost estimates to dig up and replace asphalt were also optimistic, says the report.
“It is apparent that mid to late season unit prices are higher than early spring tendering,” said the consultant’s report. “Further it is apparent there is reduced contractor interest in recently tendered projects, which is reflective in higher unit costs. Reduced interest is likely a combination of fewer contractors and contractor commitments to other projects.
“The tendered unit prices of Cantex are not unreasonable but do reflect a different level of contractor interest that has been received historically. Overly optimistic quantity and unit price estimates by True are the primary contributing factors to the higher costs as compared to the budget.”
Barry Romanko, the town’s chief administrative officer, said heavy spring rains could cause major flooding problems in town if the main lift station upgrade isn’t completed.
McKortoff said this project is too important to delay.
“If we leave it for another six months or a year, there could be much higher costs,” she said. “I think we should be doing this and doing it now.”
Plante agreed saying any delay would likely result in even higher costs down the road.
Rhodes said he wanted to delay the project because the project was too far over budget and the town’s lagoon ponds no longer have capacity issues.
The town spent $150,000 last year to build a secondary effluent line and rock tunnel near the south end of Desert Park, which can be used in an emergency situation to divert excess effluent and this can be used if there are any flooding problems next spring, said Rhodes.
Ryan agreed saying “we have a safety valve for our lagoons” at Desert Park to handle excessive effluent.