By Mike Renzella
The Haldimand Press
CALEDONIA—Following a successful bid from local contractor RF Almas Ltd., work is set to go ahead on a major infrastructure upgrade in Caledonia that will see the replacement of cast iron watermain and sanitary sewer pipes along Sutherland Street East, East Edinburgh Square, West Edinburgh Square, Caithness Street East, and Nairne Street.
The project, originally tendered last May, was terminated at the time as the County only received one bid at approximately $6 million, nearly three times the project’s forecast budget of $2,022,600. County staff put the project out for bids again in November, securing the bid from RF Almas at a significantly lower rate of $2,922,340 – but still nearly $900,000 higher than the County originally planned.
“The implication of the overage on this particular one is that we’re drawing from the reserves faster or more than we anticipated. It’s not hitting people’s tax rate directly; what it means is if this gets approved, there will be $900,000 less in the reserve to move forward and we’ll have to deal with that as we bring our capital budget forward,” said County CAO Craig Manley.
Manager of Engineering and Capital Works Tyson Haedrich shared his thoughts on the project and the inflated cost during a Council in committee meeting last week.
“The project itself was originally driven by cast-iron watermain running from Argyle Street, down Sutherland, by Edinburgh Square, and then to Caithness Street. There’s a requirement, as identified in the Caledonia Master Servicing Plan, to upsize the sanitary sewer along that same route,” said Haedrich. He said these upgrades factor in “all the future development that’s coming up and the wastewater that’s conveyed through the new pumping station for the Gateway project that’s being built further north on Argyle Street.”
He added that securing the lower bid was the result of putting out the bid at an ‘optimum time’, based on advice the County received from contractors and developers.
“Of the $900,000 that we’re short, over $600,000 of that is for development charges related to upsizing the sanitary sewer,” he continued. “There’s also about $160,000 in Road Works that’s related to excess soil regulations that have come into effect.”
Haedrich called the inflated costs “indicative of what we’ll be seeing in the future. I think prices have peaked and were wildly fluctuating. They’ve stabilized now, and housing prices have come down a little bit, but not to the levels we were seeing two years ago.”
Haedrich said that the County’s upcoming 2023 budgets will take these factors into account, but “we don’t know where things will go in the future. I hope this report isn’t indicative of every report we put out.”
Caledonia Councillor Dan Lawrence asked Haedrich if the County would now need to revisit many of their capital 10-year projects to “estimate what they could cost in the future and be prepared for those.”
“I think 2023 will be an indicator of where we’re at. We’re doing our best to try and time the market a little bit. That’s helped us in the past; we’ll see if it helps us now,” replied Haedrich.
He continued, “2023 will be a learning year for us, where we’re at. 2024 will be a year where we’ll have to look at where we are and where we’re going. There’s a lot of uncertainty with interest rates going up.”
Haldimand Mayor Shelley Ann Bentley was critical of the logic behind leaving the project undone for so long.
“It’s been there for decades, and we waited until inflation is at 6.5% to repair it,” she said. “Going forward, we really have to look at our infrastructure and plan for when we’re repairing it and not waiting until it’s at the last minute when we have to repair them.”
Ward 5 Councillor Rob Shirton countered Bentley’s comment.
“It’s not like we waited too long here,” said Shirton. “Ideally, it would have been nice to be done five years ago, but otherwise it would have caused such a spike in the user rates – that’s why this is pushed out like it is. I give credit to Tyson and his group for budgeting this out.”
He added, “If we had more money and more users, we might have been able to do this sooner, but it would have been too much of a bump up to do it a few years ago.”
With funding approved, County staff will now proceed with awarding the tender through a purchase order.
No timeline has been revealed yet for when the work will take place or what disruptions it may cause to local traffic.
