Mayor Dean Fortin, the City of Victoria, and the companies hired to design and construct the new Johnson Street bridge are heading to “Expedited” Mediation to resolve disputes over change orders and potential cost over runs.
City of Victoria Spokesperson, Katie Hamilton, stated “Change order requests are not unusual in large projects of this nature and are the typical mechanism for contractors to present potential changes.” Hamilton further stated that “The City has not agreed to any changes, and these requests will be the focus of mediation.”
According to Katherine Dedyna reporting for the Times Colonist, the three parties, Designer MMM Group, PCL Construction Group, and the City of Victoria, have selected Senior Counsel and Mediator, Stuart Hankinson, from Vancouver law firm Shapiro, Hankinson, Knutson for their mediation. The firm specializes in construction law and is reported to be charging $600 per hour for mediation services.
Despite the September 30, 2014 City of Victoria’s news release on the “expedited” mediation, there has been no firm information about when the mediation will take place. CTV News reported October 29, 2014, that the mediation is not scheduled “for another week or two”.
This estimated start time for mediation will likely come too late for Victoria voters. Victorians head to the polls, to select their Mayor and City Counsellors, November 15, 2014.
Ida Chong, Mayoral Candidate, challenged Dean Fortin to come forward about with information on cost overruns.
October 29, 2014, Ms. Chong appeared in a TV Interview on CTV news with an Engineer who provided her with a pro-bono and independent report on the project. Their estimates of the actual cost of the Johnson Street Replacement Bridge is between $104 Million and $110 Million, more than $10 million dollars more than the amount released by the City of Victoria and Mayor Dean Fortin.
The City, on their June 5, 2014 press release, has what they refer to as a “fixed-price contract” of $62.9 million, with a $2.815 million contingency fund. However, the City of Victoria received a change order almost 5 months ago, requesting an increase of at least $7.9 million. As Michael Butterfield recently told CFax 1070 “There simply is no certainty a fixed price contract when the parameters of the contract change. The contract is based on the parameters in the tender. If those parameters change, somebody has to pay the price. The goal of the mediation will be to decide who and how to absorb the changes”.
William Doyle, P.Eng stated in the October 29 CTV interview, “The large part of the increase in cost is based on delay, schedule delays, and PCL and MMM change orders submitted in May and August.”
Mediation may assist the City and it’s contractors come to an agreement on what is included, or excluded, in their fixed-cost contract. However, it may not come soon enough for Victoria’s voters.
Victoria residents will be choosing their Mayor and City Counsellors in the November 15, 2014 Municipal election.