The longer the city waits to start building a Crystal Pool replacement, the more it will cost, says a report going to Victoria councillors this week.
“The guys that are monitoring the market say things are not getting any cheaper. In fact, they are getting even more expensive than what folks were anticipating,” parks, recreation and facilities director Thomas Soulliere said in an interview.
Taking market conditions into account, a local expert has pegged the annual cost escalation rate from 2018 onward to be six to eight per cent.
That translates to $385,000 to $475,000 a month.
Those numbers are one to two per cent higher than initially projected, the staff report says.
“As construction costs will not decrease over time, a prudent method of mitigating this risk is completing the pre-construction design work at the earliest opportunity,” the report says.
The project has a preliminary cost estimate of $69.4 million.
Undertaking design work prior to securing funding would put the project in a good position when federal and provincial infrastructure grants are awarded in 2018, the report says.
The city announced Friday that it had awarded a $3.3-million contract for project design and engineering to HCMA Architecture and Design.
“The reason we want to get this design work done as soon as possible is because we know we are going to have to pay for it, and it’s pegged to the regular cost of construction,” Soulliere said.
“So we want to get that done and be ready to get out to market for construction tenders at the earliest opportunity, once we get the funding question confirmed.”
The city has earmarked $10 million in reserves to go to the project and is hoping to secure enough senior government funding so that it won’t have to hold a referendum to authorize borrowing the money.
Staff have been advised by a senior representative of the Canadian government that design costs are ineligible for federal funding, the report says.
The city already has spent $470,000 in project costs and has committed to paying Turnbull Construction Project Managers $1.3 million for project management services, the report says.
“It is important to note the city has structured the agreement with the project to include an exit provision if full project funding is not secured,” the report says.
Pre-construction phase costs include: project management and communications, due diligence, design work up to 25 per cent of the complete design.
In February, council unanimously voted to replace the nearly 50-year-old Crystal Pool complex with a new facility at a budgeted $69.4 million. The new facility would include a universally accessible pool and wellness centre.
City staff are looking to a variety of grant programs for funding. They say the most promising program is phase two of the federal Investing in Canada Plan, which is making $21.9 billion available for social infrastructure over 11 years.
Details about how much will be distributed to each province are to be released this month.
Victoria staff say the province will be responsible for determining eligible projects and administering the funding agreements.
“It is therefore critical for the city to continue to dialogue with local MLAs, the Ministry of Community Sport and Cultural Development, as well as the federal Ministry of Infrastructure and Communities to ensure the city’s infrastructure needs remain at the forefront of federal and provincial negotiations,” the report says.
