Calgarians will have a better idea come June of what the cost or design implications are on the proposed $5.5 billion Green Line, given market and inflationary pressures.
That’s when the 60 per cent design phase should be complete and ready to present to the board and Calgary city council, along with their suggestions to alleviate those concerns, according to Green Line CEO Darshpreet Bhatti, who delivered a presentation to the city’s Executive Committee on Tuesday.
This comes after the most recent Green Line update, first reported by LiveWire Calgary, showed that cost concerns on the transit megaproject had elevated from orange to red.
The report showed contractor bids had come in higher than expected, something Bhatti said is typical for a massive project that’s only reached the 30 per cent design stage. As risks are managed, those costs could come down.
“The way the market has been responding to us is that you need to be at least close to 60 (per cent design) for them to have certainty on it,” he said.
“The more they can see with their sub-suppliers and subcontractors how they will how they intend to deliver that piece of scope. So, it’s just a matter of when you make one thing more defined, everything else becomes much more detailed and firmer if I can use that word.”
Bhatti said substantial work has already been completed on the Green Line – on time and on budget – including LRV design and nearing pre-production, utility relocations and the 78 Avenue diversion track for the CPKC line. He also said they’ve been able to save $400 million in costs through value engineering.
“All of these are reflections of good work that’s being done by our partners as well as our team,” Bhatti said.
“We hope to carry that momentum as we move forward into the actual implementation of Green Line through downtown and through the southeast sections of it.”
Green Line track and station construction is slated to start in late 2024.
Cost concerns worrying, but transparency is key
Ward 1 Coun. Sonya Sharp said she knows costs on a lot of projects have increased over the past several years. Sharp said that given some of the growing concern over cost increases, she’d like to see greater transparency on what impact this will have on Calgarians.
She’s happy to see they should get more answers in June.
“Everybody knows that costs are increasing on any project and a project of this magnitude is going to see, probably, added costs,” Sharp said.
“I hope that in June we can see everything that we need to see, and it’s ready to be showcased publicly because the public needs to understand what the Green Line will cost.”
Mayor Jyoti Gondek said that it’s important to note this isn’t the only project in Calgary – or Alberta and beyond – that’s seeing cost increases.
“For the board to be able to look at what those escalations might look like, and how they can manage the scope that’s expected and delivering on the budget that we have, it’s important for them to weigh in on this,” she said.
“If there’s an additional ask that’s needed, this is something that we’re obviously going to discuss with provincial and federal partners as well.”
The province told LWC on Tuesday that the province’s $1.53 billion commitment to the Green Line hasn’t changed and is set in regulation. That includes $623.6 million in provincial funding over three years included in budget 2024.
“The Alberta government has regular engagement with the Green Line Board, however the Green Line LRT project is a Calgary-owned project,” read a statement from Alberta Transportation and Economic Corridors.
Bhatti said they’d been in regular contact with provincial and federal counterparts on the Green Line progress, so none of their project hurdles would come as a surprise.
Sharp said Calgarians would have to weigh potential details and changes before deciding if any cost increase would be acceptable. Further, they’d have to examine the pros and cons of changing the project scope to keep a lid on costs.
“We need to see some more numbers and we need to be able to communicate that to Calgarians on the risk analysis and what this project will look like moving forward,” she said.
