Publisher’s Column: Arena Reno – Is $1,121,000 for a Construction Manager a Sound Investment?

By John Francis

The Municipality of Northern Bruce Peninsula has allotted ten million dollars towards a major renovation of the arena and community centre in Lion’s Head. Ten million is much larger than the municipality’s entire annual budget.This is by far the largest project the municipality has ever undertaken and everybody is (justifiably) nervous.

Various public and stakeholder consultations have produced a wish-list of features the new facility should have. Clearly, all of them won’t fit into ten million dollars. So the final project will be a compromise.

A few years ago, you could plan a project for next year with a clear idea of what materials and labour would cost. But those days are gone.

When the shovels finally hit the ground — next spring if we’re lucky — the purchasing power of ten million dollars will have shrunk dramatically from when the project was first approved. In fact, that purchasing power will probably erode a bit more between now and next spring.

So what you can get for ten million is definitely a moving target.

As staff and council deliberate what approach to take, they are always aware of the possibility of a fiasco — think the Eglinton LRT project in Toronto which is years behind schedule, billions over budget and doesn’t even have a projected completion date anymore…

How does a municipality plan a project like the arena upgrade? Who’s in charge of budget? Of construction?

None of this is easy. We don’t even have a clear set of plans yet. This sounds outrageous until you think about it carefully. What the municipality wants is the best possible facility it can get for ten million dollars. But how would you find out what ten million will buy?

Do you spend hundreds of thousands of dollars to get an architect to draw multiple versions of the plans, then get contractors to bid on them? What if none of them is feasible? What if this delays the project so long that the purchasing power shrinks further?

Or do you hire somebody who has done this so often that they know what ten million will buy? That way you only have to pay for one set of architect’s plans.

On Sept 12, 2022, MNBP hired Salter Pilon Architecture to act as Architecture Consultant on the project. In February, Salter Pilon recommended that rather than using the conventional Design/Bid/Build method, MNBP should hire a Construction Manager. This would, they said, give the muncipality much better control of costs and might also save as much as four months on the construction timeline. Council accepted that recommendation and directed staff to conduct an RFP process to hire a Construction Manager.

MNBP’s recently-hired Facilities Manager, Mark Coleman, has worked at larger municipalities and has considerable experience with multi-million dollar construction. He will lead MNBP through this project

Senior staff conducted a Request for Proposals for the Construction Manager and received three proposals. On Sept 25, Coleman recommended accepting the proposal from Ball Construction, for $1,121,220.00. Council balked at making the decision without seeing a more detailed report.

A more detailed report was presented on Oct 10. It showed that Ball Construction’s proposal was not the lowest bid; the proposal from Allen Hastings was actually 4% lower. But the proposals were evaluated using a complex rating system that assessed the proponent’s ability to undertake the dozens of tasks the contract would entail. Overall, Coleman said, Ball Construction “demonstrated the best expertise, capacity, value and understanding of the scope of work for the project”.

Manager Coleman received some pushback from Councillor Todd Dowd, on the deviation from standard operating practice on the bidding and construction process. Councillor Dowd has many years of experience in the construction industry and was unhappy with the idea of allotting this much money when we don’t even have a set of plans to work from.

Ultimately, a majority of Council accepted Manager Coleman’s assurance that this would be the most efficient way to get the project done on time and on budget. Coleman assured Council that Ball Construction has a track record of close adherence to budgets and has “quite a strong portfolio for arenas — they’ve built a lot of them”.

Question: Are Council accepting sound advice from qualified staff? Or are they stepping back from their responsibility to oversee and supervise the largest project ever undertaken in MNBP?

Aren’t you glad you don’t have to make that decision!