With the cost of its new municipal service building on the rise, the Municipality of the District of Lunenburg (MODL) needs to find $1.1 million in savings from other projects.
The search was made necessary after council moved to give the building tender to Roscoe Construction; the tender was awarded at a special meeting on June 5.
Despite being the lowest bidder, Roscoe’s tender — which came in at $6.6 million — was significantly more expensive than the $5.5 million anticipated by council.
The total price for the municipal services building is now estimated at $8.7 million.
When asked if she was surprised by the jump in price, MODL mayor Carolyn Bolivar-Getson said the difference resulted from the cost of trades like millwork and electrical.
“Council did expect the bids to come in closer to the estimated budget,” she wrote via email, adding that managing project costs is a top priority.
“It is always difficult in the estimating stage of a multi-million dollar project to determine what the bids might come in at.”
Bolivar-Getson added the province is experiencing a construction boom, which also increased costs.
Instead of increasing taxes or incurring debt, council moved to explore finding the $1.1 million price difference from existing capital projects.
Council is expected to discuss the issue at a meeting on June 25, including a presentation from the project manager about other ways to cut costs.
When asked if it was council’s belief that it was better to cut from existing projects than raise taxes, the mayor said council would explore delaying projects rather than using existing reserves.
“This project will not raise taxes, as the municipality has ample reserves in place,” she added.
As per a report submitted by Catalyst Consulting Engineers, Avondale Construction’s bid came in at $6.8 million while Maxim Construction estimated it would take $7 million to complete the project.
By moving forward with Roscoe Construction, said the report, council would keep to their goal of finishing the project by the spring of 2020.
Still, given the price of trade work, council is exploring their options to reduce the estimated costs.
“As soon as the contracts are signed, the construction of the building will begin,” said Bolivar-Getson.
In fact, work has already begun for MODL’s new home in Osprey Village; council previously awarded the tender for the building’s site development back in April.
