Toronto blames ‘external challenges’ as 22 major infrastructure projects falling more than six months behind schedule

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Michael Lewis

Special to Ontario Construction Report

What do Housing Now, the replacement of aging ferry boats and the Ethennonnhawahstihnen Community Centre have in common? They’re all infrastructure projects in Toronto that are at least partly behind schedule.

According to a staff report on the state of the city’s 77 major capital projects as of June 30, 22 are significantly delayed (by more than six months). Thirty-one are overdue by less that six months while the rest were completed on time or are proceeding ahead of benchmarks, including a program to remove accessibility barriers at city-owned buildings.

And while the repeated delays in transit agency Metrolinx’s Eglinton Crosstown LRT project garner most of the media attention, the report notes that several undertakings in other categories are also well behind schedule. These include a $45 million project to modernize the system used to register for recreational programs, which is seven years behind the initial completion target and the $80 million initiative to replace the Toronto islands ferry fleet with electric powered vessels that’s eight years behind schedule.

The report also notes that the $502 million Housing Now project approved by council in 2019 to fast- track affordable housing construction has been hit by a series of setbacks, with some phases four years behind schedule due to “market factors” including shortages of labour and materials, increasing interest rates and escalating construction costs.

The major capital projects update was submitted to city council’s executive committee in early October as an addendum to a capital variance report detailing the rate of spending of funds allocated for capital projects. The projects described in the major projects report are part of the estimated $107 billion of infrastructure in city hall’s 10-year capital plan, including Metrolinx’s transit projects in the city.

The variance report for the six months ended June 30 showed annual spending rates for budgeted capital projects had been improving from 2018 to 2020.

“However, external challenges such as supply chain issues, specialized labour shortages and high rates of inflation that are impacting estimated project costs have been experienced over the past few years and have resulted in reduced spend rates,” Stephen Conforti, Toronto’s interim chief financial officer and treasurer said in an email.

“Capital spending was further impacted in 2022 as the city was required to pause $300 million in planned capital spending to retain funds to offset the lack of promised funding from the Government of Canada to address the impacts of the pandemic on transit revenues and shelter demands.”

The addendum report, meanwhile, showed that costs have risen exponentially for the Don Mills Community Recreation and Arena Facility at the site of the former Celestica Inc. manufacturing plant on Don Mills Road.

The report says the conveyance of land from Aspen Ridge Homes to the city was delayed to the fourth quarter of 2023 pending completion of site remediation and the construction phase has been deferred from 2025 to 2027. Overall project costs have increased to $166.2 million from $85.2 million, reflecting changes to the program scope. As new opportunities for building became available the original design for a 48, 570 sq. ft. facility was expanded to a 150,000 sq. ft community recreation and arena complex, said a spokesperson for the city’s parks, forestry and recreation department.

The report cites construction challenges at the Ethennonnhawahstihnen Community Centre in North York, where visitors park on an unpaved roadway in front of the centre and where the report says the “the contractor is working on correcting deficiencies.”

The centre has been open to the public since July, three years behind schedule according to the report, but the contractor continues to adjust hardware, complete paint touch ups and address building envelope and mechanical commissioning issues. “The complexity, size and scope of this project meant that some challenges were encountered during the construction period as the industry experienced unprecedented supply chain disruptions, labour shortages and cost escalations,” a city spokesperson said in a statement.

Similarly, plans to construct a new Conservation Authority administrative office building have been delayed by three years due to factors including “mass timber trade and construction manager under performing.”

And the city’s $120 million effort to relocate and add permanent and temporary shelter beds to help house an estimated 9,000 people via its Housing and Shelter Infrastructure Development initiative is five years late the report says thanks to what it calls complexities in both acquisition and construction phases.

Construction delays at two sites on Carlton and Adelaide streets have pushed out completion until December 2025 while difficulties in acquiring and renovating sites to transition clients from the overcrowded Seaton House shelter have contributed to delays in the George Street Revitalization Project.

The report says a council decision to proceed with fully electric vessels along with the necessary supporting shore side infrastructure is behind delays in the ferry project.

And it says the original vendor to replace the city’s obsolete recreational program registration system “did not meet agreed development milestones, causing significant delays and resulting in a number of extensions afforded by the city to meet go-live dates.”

The vendor, Legend Software, cited Force Majeure due to the COVID-19 pandemic and said it would not be able to fulfil its contractual obligations, the report says. In June, the city awarded the contract to new vendor, resetting the entire process.

All told, according to Matti Siemiatycki, director of the University of Toronto’s Infrastructure Institute, the incidence of delay among Toronto’s major capital projects is not out of the ordinary, though he argues that improved performance monitoring, rewarding best-performing contractors and drawing on more precise forecasting techniques based on data about previous projects could help improve results.

“There’s a human element toward optimistic bias,” he said, adding that project forecasting can be influenced by politics and the competition to win bids.

“Big projects have a track record of being late and over budget,” said Siemiatycki, who is also a professor of geography and planning. “They struggle with all sorts of issues. It’s par for the course.”

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