Pausing Calgary’s Green Line transit project would cost the city $90 million, and one city councillor said this line needs to be done the right way, not just the inexpensive one.
And now, one neighbourhood group is calling for a postponement of the city’s Request for Quotations (RFQ) on the contract for the southeast leg of the line, to review the cost tradeoffs involved in making any changes.
Last week, Calgary’s Green Line team update city councillors, suggesting both ways to controls costs on the $4.9 billion project and to split the Phase 1 bid into two separate contracts.
It’s a mistake to move ahead with the RFQ, said the Beltline Neighbourhoods Association (BNA) president Peter Oliver. His association is pushing for the RFQ to be postponed while the overall cost impact is reassessed.
“If the city proceeds as proposed with the immediate release of the RFQ for the Southeast leg, all cost reductions for Phase 1 will have to be borne by the Downtown/Beltline section while the Southeast section would be outside the scope of any trade-off consideration without the risk of significant contractor penalties,” Oliver said.
“But if the city postpones the southeast leg, we can evaluate the cost trade offs across the whole line and still not impact the completion date for Phase 1.”
The group is asking citizens to contact their respective councillor to ask them to postpone the southeast RFQ contract.
Green Line pause pushed
Four prominent Calgary businessmen took the podium at the City’s Transportation and Transit committee meeting last Wednesday, expressing their concern about the project’s cost. They pointed at a potential $2 billion cost overrun as a primary reason for the pause.
Afterwards, Barry Lester, one of the men who spoke at committee, talked with LiveWire Calgary about the group’s decision to make a submission.
Lester said examining the costs of the Downtown /Beltline section are critical if they’re to keep the line on time and on budget.
“The people in the deep south and the deep north need (the Green Line),” Lester said.
“The big issue with the Green Line is how does it get through the downtown? That’s where all the big costs are.
“The suburban construction, well, the city knows how to do that kind of thing. But getting to downtown, that’s a big challenge. It’s a very expensive challenge.”
Though Lester was in favour of a pause, he said the whole line could still be done on schedule if the city made quick decisions on both the downtown alignment and changing their approach to crossing the Bow River.
He suggested both the alignment change and creating the elevated track instead of tunnelling under the Bow River could save a combined $1 billion.
In a statement from Green Line spokeswoman, Jessica Bell, the cost to delay the Green Line would be $90 million annually – taking into consideration a two per cent cost escalation on the remaining capital still to be spent on the project.
“Escalation means the increase in construction costs over time. Based on these numbers a delay of a year on Green Line will cost approximately $90 million plus staff time and consultants to continue design,” Bell said.
City administration has project under a microscope
Councillor Shane Keating, chair of the city’s Transportaton and Transit committee said they’d been talking with Lester’s group for a number of months, and he believes city administration has done everything they’ve asked.
“It doesn’t make sense to pause the complete project because you know where the issues are, where the risk mitigation is,” Keating said.
Keating said breaking it into two different contracts is the right approach because they can look at the two areas closely to find efficiencies. He said it’s not only cost escalation they’re looking at, but the ability of a contractor to tackle such complex projects all at once.
Few companies actually were interested in bidding on the project – primarily because of its complexity Keating said. Large international companies were the only ones capable of taking it on and Keating said that alone could drive up the cost. Breaking it up should attract more bidders and drive the price down, he said.
Green Line concerns today
Jeff Binks with the group LRT on the Green was puzzled why the group would bring the concerns forward today when they’ve had two years to get involved.
He said the city can’t afford a one year pause.
“These concerns are being raised two years too late. We don’t know what an extra year of consultations and study will solve that the previous two years didn’t,” Binks said.
“City Council owes it to the Calgarians who have been desperately waiting for this project to move forward with Green Line as soon as possible.”
Lester said they decided to go public with their concerns over the Green Line project because of the potential cost overrun. You couple that with the city’s recent struggle with the downtown tax shift and budget cuts means projects like the Green Line need to be revisited, he said.
“The manager of transportation a couple of years ago was adamant that the project wasn’t going to go over four-and-a-half-billion dollars. Well, he was wrong,” Lester said.
Lester said he sees transit as an important part of the city’s framework that has to get done. He said the city is balancing a lot of different priorities right now, including a BMO Centre expansion, an area project and others.
“That’s why we’re encouraging council to try to do them in a cost effective way – so you can get as much as possible,” he said.
Massive cost overrun not ‘realistic’
A $2 billion cost overrun isn’t realistic, said Keating – nor is a $1 billion savings by tinkering with the alignment and Bow River crossing. Further, Keating said making these changes for the sake of saving scads of cash isn’t the right decision for the future.
According to the city, they believe a $2 billion cost overrun has been calculated by Lester’s group by assuming a 100 per cent overrun on the downtown entry portion.
“It’s easy to look at a paper and say, ‘if you do this, you’re going to save money,’ right?” Keating said.
“But then what do you do for ridership? What do you do for the residents who actually need it? If you don’t put public transit where the users are, then are you really giving the service that you need?”
Green Line Lrt Alignment an… by on Scribd
Getting the Green Line right
The BNA is pushing for the city to take the time to ensure the Green Line is done the best way possible. They want the entire line re-evaluated – not just the downtown and Beltline areas.
It’s a way to reinvigorate the downtown area, the group said, especially with the city facing the downtown tax shift. They also want to reopen consideration to build the north part of the line, stressing higher ridership in that area and better transit usage.
Sure, Keating said, you can mess with the alignment all day long to get it into the price you want – but that’s not the right way to do it. He said they could have left it out near Deerfoot Trail to save money.
They want to do it right. He talks about the city’s decision to keep the 7 Avenue line above grade and all the problems that’s created with downtown traffic. Similarly, the traffic problems with the surface crossings in Calgary’s northeast.
Keating said this is a massive project and in 15 years time they want to look back and say they did it right.
“The ones who will be saying that are always the ones who always criticize, right?” Keating said.
“In 15 years, in some cases the same people will be saying you made some bad decisions. So now you’re at fault – but they’re the ones who pressured you to change the decision.
“So it’s kind of that Catch-22.”