How councils manage large-scale projects

The way local governments have to manage capital and larger construction projects is much different.


 

By Gerry Taft

The way local governments have to manage capital and larger construction projects is much different than an individual homeowner or small business owner can.  Local governments must go through a public and transparent procurement process, which almost always means, for a larger construction project, a competitive sealed bidding process.  Recent trade agreements (TILMA etc.) have further emphasized the importance of having a process that is advertised widely and with the ability for companies from all over the country or the world to submit bids. There is very limited or effectively no ability to treat ‘local’ contractors or companies with special treatment.

Another big difference between local governments and the way the work would be done in the private sector, is that there is no ability to develop long term business partnerships. Although working relationships are developed and over time you have get a sense about which firms are capable of delivering what they promise, there is no ability to promise future work or build a long-term relationship of ‘this company always does this work for us’.  Often private companies or individuals benefit from having a certain company or tradesperson who always does their work for them, they can either get special pricing or quick service- or a combination of the two.

The other reality with a tendering process is that the more restrictions and the more uncertainties contained in the project, the higher the price will be.  If there are financial penalties for non-performance or being late- then often these costs will be included in the tender amount. If there are things that are not clear as far as scope of certain work or geo-tech conditions or other factors, then the general contractor will build in contingencies into their bid.

The most logical and cost effective way of doing larger construction projects in our town is to start in the spring, work through the summer, with completion in the fall.  This however creates some real challenges with the busy summer season, especially the prime months of July and August.  Attempting to have a major project partially completed in the fall, and then finished in the spring, such as the cenotaph park—creates some inefficiencies in work plans and optics, but when the work is completed on a fix sum contract, the price is locked in for the  taxpayer, and the key months of July and August are left without construction. Many of the projects that have been completed in the recent years — including the amenity building at Kinsmen Beach, the upgrades to 7th Avenue along Pothole Park, the new Invermere sign at the crossroads, and now the cenotaph park -— have been funded with ‘resort municipality infrastructure’ money as well as other grants, resulting in no direct cost to DOI taxpayers.

If there are questions or concerns about a project, please feel free to ask a DOI council member for more information.  Exaggerated stories about huge cost over-runs and arm-chair engineering about how projects should be managed can make great coffee shop talk, but contain very little fact or useful information.