Fire hall price tag sparks lengthy discussion

Posted on December 19, 2018 by Taber Times

By Trevor Busch
Taber Times
tbusch@tabertimes.com

After lengthy debates over the town’s proposed fire hall relocation and the public dollars that should be allocated to such a project, town council has settled on a figure of $3.5 million in the 2019 capital budget.

Never a dull topic, in meetings in late November and early December councillors sparred with each other over the merits moving forward and just how much should be spent considering the controversy the project has created. Facing a public backlash over an Aug. 20 decision to relocate the fire hall to a site near 50th Street and 52nd Avenue, on Oct. 9 council reversed this decision, taking the municipality back to square one.

At the same meeting, council also rejected a low tender bid for the fire hall that had come in at $3.8 million, significantly exceeding the town’s previous estimate that the project could be completed for $2.5 million.

Originally slated for the 2020 capital budget in initial deliberations on Nov. 26, Coun. Jack Brewin questioned this timeline as well as a $5.6 million dollar estimate for land and construction costs.

“What if we come to an agreement on something before then? Let’s say we come across a deal in 2019. By earmarking it for 2020, can we move that back to 2019 at any time? And the cost. What’s the cost added per year for building a fire hall that you expect?”

Finance director John Orwa didn’t mince words with the councillor, suggesting further delays will continue to escalate the estimated cost of the project.

“What I’m see from what I’ve been seeing at the time when I was analyzing the cost of this fire hall, is it’s been escalating every single year. And since the project was undertaken, it looks like it keeps on going up. And in fact if you look at it very closely, for this fire hall to be built right now it looks like we’re looking at almost $5.6 million to $6 million. And if we continue to procrastinate, the cost will keep on escalating.”

CAO Cory Armfelt readily agreed with this assessment, highlighting annual cost escalations in the 10-20 per cent range.

“In talking with GVN Enterprises, who were the low bidders in the last RFP for the fire hall, we had spoken to them early in 2017 with regards to what they could put together, that package that the chief (Steve Munshaw) had talked to with regards to a comprehensive fire hall for the future, and they had indicated to us they could do that for about $2.5 million. The $2.5 million was just taking a building and parachuting it down onto a piece of property. When they came back with their RFP it was about $2.8 million. We are looking at cost escalations of 10 – 20 per cent per year just simply in the materials alone, and then on top of that any land that is looking to be purchased — depending on where it is located — the servicing and apron costs would go in on top of the actual costs to get that built.”

Taking direction from council to move the fire hall project out of the 2020 capital budget and back into 2019, at their special budget meeting on Dec. 3 further debate centered on this cost estimate, which was now pegged at $5.1 million (minus anticipated annual cost escalations from the original 2020 capital budget figure of $5.6 million).

“I’d like to see a fire hall developed, but I think we’re going to have a tough time convincing the people in this community after what we’ve been through to spend $5.1 million,” said Coun. Joe Strojwas on Dec. 3. “I would like to see that re-evaluated, or re-positioned, at $2.5 million plus property. It comes back to this timeline that we did a year and half ago. We need to get this built. We need to get it built in 2019, but I’m thinking there will be too much opposition at that price tag. I think probably we need to scale back what we’re building, we could build a metal-clad building. Do we want a fire hall built or not? Do we want to proceed with this? It’s going to be a hard sell at $5.1 million. A steel structure, $2.5 million plus land, I think we could sell that.”

Coun. Garth Bekkering, who has expressed reservations about the project in the past, also wanted to council to adhere to a much lower figure than $5.1 million.

“I couldn’t agree more with you, that should be $2.5 million or a little bit more or less. I’m not exactly sure, but I do agree that council has made a decision to build an emergency services building. It will be built. But at what cost, and of course where?”

Crunching some numbers, Strojwas still felt a new fire hall could be built for significantly less than a $5.1 million figure.

“That number — that $5.1 million — includes the land. And I’m saying we can build a two-story steel structure for probably around $70 per square foot, a basic structure, not quite sure exactly the dimensions, and we can finish it accordingly to what we are able to afford, that $2.5 million and factor in the cost of land. We’ve had some discussions as to what the land could be, and I’m thinking that probably we’re going to end up somewhere between $500,000 – $700,000 for land and servicing.”

Taber Fire Department chief Steve Munshaw volunteered how the project was broken down in October and the various cost factors involved.

“So how we came up with these numbers, we had 10 bids from the last RFD that we went to, and those 10 bids we took the average, which came out to $4.6 million. Each year we add nine per cent on to that, which came out with one year addition to $5.1 million with land and construction. The last visual that we’ve seen on a metal-clad building on a concrete slab came in at $2.8 million plus underground servicing, purchasing of lots, and the outside paving. With a contingency of eight per cent, it came out to $3.8 million, which was presented to council at its October 9 meeting.”

Coun. Louie Tams would endorse Strojwas’ breakdown of the project cost.

“I like Councillor Strojwas’ viewpoint on the fire hall, to put that number considerably down to where we were at $2.5 million plus the land, so at $3.3 – $3.4 million, that number works and leave that in 2019.”

Later on during the Dec. 3 special budget meeting, debate would again return to the budget estimate for the project.

“For the fire hall, I propose that we put a $3.5 million figure in there — $2.5 million for the building, an additional $1 million for land and servicing — so we have a concrete figure, and try to proceed with that there.”

Brewin took immediate issue with any attempts to suggest that the project’s allocation should be reduced in 2019.

“I think leaving it at $3.5 million you’re not giving us room — I think you may be low, because we don’t know where we’re putting it. We may put it on our own land. So it’s hard to put a number on it.”

Unswayed by Brewin’s arguments, Tams would side with Strojwas’ proposal.

“I would concur with that. I see the wisdom in what he’s suggested there at $3.5 million. It falls in line with what we have said to the public, it falls in line with what we’ve been talking about all along, here’s a number that’s what we need to work to. I don’t disagree with Councillor Strojwas, I would like to see that, too.”

Bekkering reminded fellow council that all projects of financial significance eventually come back to council for final approval.

“There’s no need to get into a debate over this. I believe Councillor Strojwas has made a good suggestion, let’s put it in there, and if it comes in a couple of hundred thousand dollars higher — or lower — so we’ll deal with it.”

Coun. Carly Firth, on the other hand, argued low-balling the project’s cost estimate might be short-sighted in the long run.

“Is it realistic to budget so little for that? Our administration is recommending that we’re not going to be able to do it for that price, is that realistic?”

Strojwas was unfazed by this assertion, suggesting contractors will “make it work” at $5.1 million or $3.5 million.

“Often times when you put a budget figure out there to the public, and to these construction companies, they’ll make it work for the $5.1 million, trust me. Or they can make it work to the $3.5 million. And we’ve seen this before in projects.”

Eventually siding with Strojwas, Coun. Mark Garner felt council’s reputation would suffer if the town failed to adhere to a rigid cost figure regarding the fire hall project.

“I agree with Councillor Strojwas. I think just like was illustrated before the break, the auditorium renovation came in way under budget. I think the same thing’s going to happen here. People will sharpen their pencils. I think when we promise the town something, I think we have to stay pretty close to what we promised. I think we violate trust and reputation when we go double of what we suggest.”

“Which I don’t think has happened,” said Brewin. “That’s a statement that… when did we present the costs to them?”

“We haven’t,” replied Garner. “But what I’m saying is let’s stay with what we said we would do.”

Brewin was still uncomfortable with the idea of reducing the estimated project cost.

“Yes, but is that reasonable? It’s going to cost more as we go. The longer we wait, since this first came to council, the money that’s been spent deciding — just getting to this point, money was spent— I think at $3.5 million, let’s do it for $2.8 million if we can. But don’t limit yourself at $3.5 million. If it’s $4 million, are we going to do it? It’s a couple hundred thousand dollars more.”

Mayor Andrew Prokop contradicted Brewin and Garner, suggesting the town has provided figures and cost estimates to the public in the past.

“We did clarify figures at the last forum less than a year ago, so that was out there, that is out there, that’s still currently on the table.”

As part of a larger motion on Dec. 3, council voted 5-2 to reduce the fire hall project’s estimated cost figure in 2019 to $3.5 million. Councillors Firth and Brewin voted in opposition.