Sunday, May 6, 2012

Where the money is going:

When the Johnson St. Bridge referendum was held in Victoria, a cost estimate was offered to the electorate based on a project that included a well-defined set of works.  It did not include the cost of moving a secure data line owned by telecommunications giant Telus, who had insisted from the outset that the city was not to touch their utilities infrastructure lest they damage something of value (and what it carried they wouldn’t say).

Fast forward a year or so and the city’s contracted risk managers pushed back, suggesting to project engineers that a higher risk (and associated liabilities), would face the city if the line was not moved to keep it safe from an errant backhoe or other damage from the construction project.  Costs could balloon and schedules would be derailed by legal claims and project interruptions that the risk assessment proposed the city could ill afford.

A cautious and responsible approach had city and consulting engineers returning to plead with Telus for permission to move the line, understanding that the city would have to absorb the cost, and the project budget pressured after the fact.  The city and council could have stuck within the confines of the promised budget figures to hold the line, but that would have represented a failure of responsibilities to protect the project timelines and exposing taxpayers to the cost of doing damage to Telus property, among other problems it would have created for the bridge project.

Wisely enough, the decision at council, save for a few errant votes, took the safer course of moving ahead with the recommendation to move the line and take the political heat for changing the scope and budget for the new bridge.  Predictable accusations of cost overruns and poor management followed.  But the real issue is whether or not the city made the right choice in picking higher up-front capital costs to avoid the risk of more costly and problematic impacts on the project had the line been damaged during construction.

It is not a nickel and dime question, since project design, management and in the ground work to move the Telus line added more than $4 million to the overall cost of the new bridge.  There are other costs to be accounted for, and most of them well thought out and responsible scope changes, though still the accusations of runaway costs continue to dominate the political debate.  Never the let the facts interfere with a good story, as the saying goes.

Costs are real enough to be sure, and paying for them always a genuine challenge, though the city has managed well enough to secure funding (bringing investment, jobs and new durable infrastructure into the city).  There are those who will continue to score political points on the extra costs, and critics who have a different agenda (it’s always been about saving the old bridge and nothing else), but when the new bridge completes and the city returns to a new normal, more thoughtful reflection on the decisions of the day may come to different conclusions about what the right choice was.

On the Telus line though, and that $4 million balloon in the project budget, the city and council made the right choice, though some may yet pay a more political price as the future unfolds.  Stay tuned.

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