<\/p>\n
Ontario Construction Report staff writer<\/p>\n
The provincial government\u2019s decision to cancel the Hamilton Light Rail Transit (LRT) project is the \u201ctip of the iceberg\u201d of a serious problem with current Infrastructure Ontario (IO) <\/a>project proposals \u2013 the excessive transfer of risks to consortia bidding on the projects \u2013 says Clive Thurston, president of the Ontario General Contractors Association (OGCA).<\/a><\/p>\n Thurston says he understands that at least one of participants among the finalists bidding on the decided to stop working on the project \u201cwhen they saw where the costs were going\u201d \u2013 and that the construction costs alone (let alone the ongoing operating costs) had reached a point where the project was no longer viable.<\/p>\n \u201cThere are two things driving costs right now,\u201d Thurston said. \u201cOne of the lack of workers. We don\u2019t have enough workers to do these jobs.\u201d<\/p>\n \u201cThe second is the risk transfer is driving costs to the point that bidders are second-guessing their participation.\u201d<\/p>\n Thurston said he has been able to confirm that the risk transfer problem isn\u2019t exclusively with the Hamilton LRT project, which had other challenges \u2013 namely that there was no federal funding to help absorb costs.<\/p>\n \u201cI was able to confirm this is the tip of the iceberg\u00a0 (in that) at least four other projects that were under way\/bidding have been extended or delayed repeatedly,\u201d he said. He did not name the other projects. He said there were earlier concerns about IO expecting contractors to \u201ctake responsibility for underground utilities.\u201d This is problematic, because especially in older communities, \u201cwe don\u2019t know where they are\u201d and there can be many surprises \u2013 which need to be paid for, one way or another.\u201d<\/p>\n Thurston said Metrolinx has agreed to take on the utility locates for future projects \u201cwhich is a good sign\u201d but unfortunately other risk transfer issues have been built into other IO projects.<\/p>\n In a statement, IO said it has notified the proponent teams of the project’s cancellation. \u201cAs per the Break Fee policy outlined in the Request for Proposals, teams will receive a stipend according to their involvement in the procurement process,\u201d IO says. \u201cIO and Metrolinx will be meeting with the teams in the coming days to discuss next steps.\u201d<\/p>\n \u201cOver the coming weeks, the province will work with the city to determine alternative opportunities to deliver on its $1 billion funding commitment to ensure the city gets the transportation that it needs.\u201d<\/p>\n IO spokesperson Ian McConachie said the agency is committed to working with private sector stakeholders to minimize risk issues, especially where it can use public sector powers on matters such as land assemblies and utility locates.<\/p>\n \u201cWe are continually adjusting our processes as we work closely with the industry and stakeholders to improve our work as projects and the marketplace also evolves,\u201d McConachie said.<\/p>\n Shortlisted teams for the Hamilton project included:<\/p>\n CityLine Transit Group:<\/strong>\u00a0 ACS, Aecon, CRH, TIAA, Dragados, Dufferin \u2013 Parsons, HDR, Amec, RHDA, Serco;<\/p>\n Ei8ht Transit: <\/strong>EllisDon, Fluor, Bombardier WSP\/MMM, Hatch, Gh3;<\/p>\n Mobilinx:<\/strong>\u00a0 Astaldi, John Laing, Hitachi-Ansaldo, Amico, Transdev, Bot, IBI, Daoust Lestage, Morrison Hershfield, Exp Services, Arcadis<\/p>\n The original project called for 14 km. of new dedicated lines, with 17 stops, and an operations, maintenance and storage facility. Construction was supposed to start imminently, with an estimated completion date of 2024. IO had intended to deliver the LRT project with the Alternative Financing and Procurement Design-Build-Finance-Operate-Maintain delivery model.<\/p>\n","protected":false},"excerpt":{"rendered":" Ontario Construction Report staff writer The provincial government\u2019s decision to cancel the Hamilton Light Rail Transit (LRT) project is the \u201ctip of the iceberg\u201d of a serious problem with current Infrastructure Ontario (IO) project proposals \u2013 the excessive transfer of risks to consortia bidding on the projects \u2013 says Clive Thurston, president of the […]<\/p>\n","protected":false},"author":2,"featured_media":10385,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[116,86,45,89],"tags":[],"class_list":{"0":"post-10383","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-around-the-province","8":"category-associations-and-unions","9":"category-local-news","10":"category-projectsopportunities"},"_links":{"self":[{"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/posts\/10383"}],"collection":[{"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/comments?post=10383"}],"version-history":[{"count":1,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/posts\/10383\/revisions"}],"predecessor-version":[{"id":10386,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/posts\/10383\/revisions\/10386"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/media\/10385"}],"wp:attachment":[{"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/media?parent=10383"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/categories?post=10383"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ontarioconstructionreport.com\/wp-json\/wp\/v2\/tags?post=10383"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nThurston says IO has designed the project specifications to \u201cmake us responsible for everything\u201d and the only way the bidders can stay in the game is to increase their bids significantly to reflect their higher costs. \u201cFor example, they want to make us responsible for the rolling stock \u2013 that is not what we do.\u00a0 If we have to take on the risks, the costs go up.\u201d<\/p>\n