Vaughn Palmer: CBAs on just three public projects in B.C. will boost costs by tens of millions

The CBAs require workers on designated projects to join one of 19 NDP-favoured unions within 30 days. They also include pay, benefits and other conditions that can add as much as seven per cent to the cost of construction, by the government’s own admission.

The budget to replace the aging Pattullo Bridge is currently $1.377 billion. Francis Georgian / PNG

VICTORIA — The New Democrats are continuing to drive up the cost of taxpayer-financed construction in the province, with more than $4 billion worth of projects already covered by union-friendly community benefit agreements.

The CBAs require workers on designated projects to join one of 19 NDP-favoured unions within 30 days. They also include pay, benefits and other conditions that can add as much as seven per cent to the cost of construction, by the government’s own admission.

Three recent announcements from the ministry of transportation and infrastructure should give a sense of the size and scope of the NDP’s intentions on the file.

Feb. 11: The transportation ministry issues a tender call for four-laning a two-kilometre stretch of the Trans-Canada Highway 1 east of Revelstoke.

It is budgeted at $63 million, with the province on the hook for three-quarters and Ottawa picking up the balance.

“This is the first of several upgrade projects on the Trans-Canada Highway between Kamloops and Alberta to be built using a community benefits agreement,” says the news release.

“Community benefits will include job and training opportunities for people in the local area and will increase the participation of apprentices and workers traditionally under-represented in the construction trades, such as Indigenous peoples, women and people with disabilities,” it continues, not mentioning either the union-favouring provisions or the added cost.

The project is part of a $464-million commitment by the NDP to four-laning the Trans-Canada through that part of the province over the next three years.

The next specific installment is probably a five-lane replacement for the almost 60-year-old R.W. Bruhn bridge at Sicamous.

The project was in the three-year capital plan in the provincial budget last week, priced at $225 million, with the province scheduled to pay 60 per cent and Ottawa the rest.

The ministry confirms it, too, will entail a community benefit agreement.

Feb. 14: The province announces the three pre-qualified bidding teams for the competition to design and construct a toll-free replacement for the 80-year-old Pattullo Bridge.

The project’s budget of $1.377 billion will be funded entirely by the provincial government, after the New Democrats agreed to take over the Pattullo from TransLink, the regional transportation authority.

“Construction of the new Pattullo bridge will be facilitated by the province’s community benefits agreement,” says the news release, echoing an announcement last July.

One head-turner among the three bidding teams is SNC-Lavalin, the Quebec-based firm embroiled in controversy over efforts to obtain a deferred prosecution on allegations of corruption. If convicted, the company would face a 10-year ban on bidding on contracts in Canada.

SNC-Lavalin will be competing against Kiewit Canada, which built the new Port Mann bridge, and a consortium led by Flatiron Constructors Canada, which is also a partner in building the generating station and spillways at Site C.

Feb. 15: The province issues a request for qualified contractors to design, build and finance the Broadway Subway project, a 5.7-km-long extension of SkyTrain from VCC-Clark to Arbutus St.

The call is on a tight timeframe, closing in April. “The ministry will then select up to three respondent teams to participate in the subsequent phase of the competitive selection process.”

Given that SNC-Lavalin built the earlier phases of SkyTrain, it would hardly be surprising to see it make that list as well, controversy notwithstanding.

The twin-tunneled subway and six stations are together budgeted at $2.83 billion, with B.C. putting up $1.83 billion, Ottawa $900 million, and Vancouver $100 million.

And once again, “the project will be delivered under a community benefits agreement announced by the provincial government.”

So that’s $464 million for widening the Trans-Canada, $1.377 billion for the Pattullo, and $2.830 billion for the SkyTrain expansion — $4.640 billion in total for projects with community benefit agreements.

In announcing the deal to build the Pattullo last summer, the New Democrats acknowledged that the benefit agreements could add as much as seven per cent to the cost of a given project.

On that estimation, news stories had the NDP’s union preference counting for almost $100 million in the budget for replacing the Pattullo.

But the New Democrats have since tried to fudge the numbers, saying the “up to seven per cent” calculation applies only to the cost of construction and not other matters in the budget for a given project.

“Estimated CBA costs are factored only into construction costs and can vary depending on the type of project,” according to a statement this week from the transportation ministry.

“With some projects a significant proportion of the total costs are non-construction costs, related to property acquisition, project management (including engineering, legal, environmental), and interest during construction.”

For instance, although the Broadway subway will be underground, there are major land acquisition costs for the entry points for the six stations.

Nor are the New Democrats prepared to specify what part of a given project budget is represented by construction costs.

“We can’t say right now” was the reply from a government representative this week. “That’s part of what the procurement process is all about.”

Forget about ever getting a precise dollar figure for how much the NDP’s union preference is adding to the cost of taxpayer-financed construction in the province.

But on the strength of what the New Democrats have admitted so far, the tab must run to the tens of millions of dollars.

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