Title
Township Road 510, Range Road 50 to Range Road 51 - Budget Approval Request
Proposed Motions
1) That Council approve an additional amount of $383,244.22 of MSI funding, to an upset limit of $1,433,344.22, for Township Road 510, Range Road 50 to Range Road 51 (1.71Km).
2) That Council approve an additional amount of $569,600.94 of MSI funding to extend the current project limits identified in Motion 1) by 0.81Km for Township Road 510, Range Road 45 to Range Road 50. Assuming the additional funding identified within Motion 1) is approved, the new upset limit would be $2,002,945.16.
Body
Administration Recommendation
Administration supports the proposed motions as presented.
Purpose
Additional funding is required to be approved prior to awarding a 2017 Capital Road Project (Township Road 510; Range Road 50 to Range Road 51) as the tender process resulted in higher costs than what was approved within the 2017 budget. Engineering Services further proposes the project limits be extended to include the 2018 portion of the Capital work as a matter of efficiency and proposed cost savings. The tender prices are deemed to be competitive and the work can be accomplished within a single construction season; limiting time and energy required to manage one project vs two.
Summary
Engineering Services, with the assistance of Procurement Services, recently completed a construction tender process for Township Road 510 between Range Road 50 and Range Road 51. The results of the tender were within 2% of the pre-tender estimate completed by the project consultant. Prior to tendering the project, Engineering Services was aware that the pre-tender estimate was higher than approved budget however, a strategic decision was made to complete the tender process and return to Council a single time with confirmed values post-tender. The alternative was to go to Council for budget approval with a pre-tender estimate and potentially return to Council with a post-tender price OR explain a variance throughout the year if the tender closed less than updated budget amounts.
In 2016, Engineering Services completed detailed design for Township Road 510, between Range Road 45 and 51. The 2016 design project was to be constructed over a two year time frame (2017 and 2018). At the east limits of the project a pending bridge file replacement reduced the project limits in 2018 from 1.6 Km to 0.81 Km. Engineering Services opted to request bid prices for the 2018 portion of the work as part of this year's bid package to determine if there were competitive prices available and to determine if the work could be completed as one initiative instead of two. Prices were provided in the recent tender that were competitive compared to similar initiatives in 2016 and 2017 and the timeline committed within the tender suggests the work can be fully completed in 2017. All land required for the project has been purchased and there are no identified utility conflicts.
Approval of the first motion will allow Engineering Services to complete the work committed within the 2017 Capital Road Program. This project will not advance without additional funding as Administration cannot approve a project that is knowingly above a Council approved budget. If Council does not approve the first motion, this project will be postponed to 2018 whereby additional funding may be requested at that time OR the project scope can be adjusted to fit within existing approved budgets.
Approval of the second motion will allow Engineering Services to complete a portion of the 2018 Capital Road Program in 2017. There is an efficiency gained in connecting the two projects by reducing the number of inspections and overall time required for project management. Prices submitted within the tender documents are deemed to be competitive and will not likely be lower in 2018 based on current market activity. If Council does not approve the second motion, this portion of work will be scheduled as originally planned within the 2018 construction season. Updated cost estimates will be completed and submitted through the normal Council budget approval process.
In summary, Engineering Services recommends that Council approve the additional funding to complete both the 2017 and 2018 portions of the work as a single initiative in 2017. The first motion providing funding to complete the 2017 stage of work and the second motion providing funding to complete the 2018 stage of work. The amount requested for each stage of work is $383,244.22 and $569,600.94 respectively; for a total increase in budget by $952,845.16. The new project budget will be an upset amount of $2,002,945.16. A breakdown of costs is provided in the attached document.
Strategic Plan/Policy/Legal/Staff Implications:
Complete Communities: 1.2: We are a region of connected communities, through infrastructure, transit, recreation facilities, trails and technology. Investing in, owning, and maintaining infrastructure that supports access to technology, improving quality of life and business viability.
Financial Impact:
Cost: Motion 1: $383,244.22; Motion 2: $569,600.94
Source of Funding: MSI Grant Funding