Penticton is one step closer to replacing its outdated disinfection system at the water treatment plant, though the city is going over budget to do it.
According to a report from city staff on Oct. 24, the current system was installed in 1996 when the plant was first built and relies on highly-dangerous chlorine gas. To replace the system with a safer, liquid-based one, the city anticipated a cost of $633,500 which was included in the 2019 budget.
After tendering the project in April 2019, the city did not receive any bids and was forced to revise its plan by purchasing the needed tank and pumps, which cost the city about $150,000. When the project was re-tendered, two bids came in before the deadline on Oct. 9.
“The low tender was $138,590 over budget. Staff and the consultant worked with the low bidder over the period Oct. 10 to 16 to see if the cost could be reduced to keep the project within budget,” reads a staff report on the project background. “It was found that this was not possible.”
According to Ian Chapman, city engineer, the project is a one-off that the contractor has never done before and will likely never do again, which is why it was hard to anticipate the cost of the project accurately in the 2019 budget.
“We made our best estimate as to what the contractor would supply for a price to do the work and on this one we got it wrong. Sometimes we’re under, sometimes we’re over and this was our best attempt to budget the right amount and we were wrong.”
Chapman said the project is unique because they are renovating an existing building and every water treatment plant is different, so a contractor would not be able to rely on experience.
Mayor John Vassilaki questioned whether the contractor may have padded the cost since the project did not receive any bids the first time it was tendered. Chapman said there is no way to know with absolute certainty, since they did not receive any quotes the first time to compare to this one, and if they re-tendered the project again there is no telling if the quotes would be higher or lower.
City council voted unanimously to redirect $25,590, surplus from another project, and $113,000 from the water surplus reserve to make up for the budget shortfall. The balance of the reserve was just over $6.8 million as of Dec. 31, 2018.
There is no timeline for when the project will be completed.
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