The City low-balled the price tag and is concealing that fact. With so much being hidden and costs likely to top $100 million, is it time for a change of course?
THE WHIFF OF SCANDAL around the Johnson Street Bridge project grows stronger. One wonders what it will take for one of the die-hard City of Victoria councillors—the ones who have clung steadfastly to what appears to be a sinking ship—to jump before they’re sucked down with the wreckage.
Former councillor Philippe Lucas, a stalwart supporter of the project throughout his three-year term, has jumped. When Lucas learned the new bridge had lost its one unique feature—a walkway that would allow pedestrians passage through the 50-foot wheels while the bridge was being raised or lowered, his response was unequivocal. “That truly sucks!” he wrote on Facebook. “Whatever my feeling may have been at the start of this project, when we lost the rail portion of the bridge due to reluctance from the last council to back multiple motions I put forward to save this key economic link to the rest of the island, I began to realize what an unmitigated disaster this new bridge was going to be. Losing the ability to walk through the bridge is simply the final blow to what could have been an iconic link to a more sustainable future for Victoria, but has now become a short span to budget increases and unacceptable design changes, and an iconic local monument to the short-term thinking that plagues modern politics. What a debacle; what a disappointment.”
Perplexing questions about the “debacle” continue to float to the surface: Did Mayor Dean Fortin and City Manager Gail Stephens hide a massive redesign and its cost implications before last year’s civic election? Have the costs of that redesign, still unacknowledged by any of the bridge’s promoters, even been included in the latest $93 million estimate? Was the second-to-last cost estimate purposely low-balled? What else has been concealed? Does the City even have a Plan B?
What the mayor won’t talk about
On April 3, Mayor Fortin wrote a letter to the Times Colonist stating the design change to the walkway had been discussed at a February 7 council meeting. The mayor was making the point that the change had not been hidden from councillors. The next day, Ross Crockford, a director of watchdog JohnsonStreetBridge.org, wrote to Fortin disputing this claim and asking him to make a public correction. Crockford had recorded the meeting and a transcript showed the design change had not been discussed on February 7.
Then, during a question period at an April 12 council meeting, Crockford asked Fortin if he intended to correct his statement that the design change had been discussed on February 7. Fortin replied, “I choose not to answer any of your questions, Mr Crockford. You are free to file an FOI request, if you want.”
“Wait—any questions?” Crockford asked.
“Any questions,” Fortin replied.
Why is the question of whether or not the walkway change was discussed with councillors such a sensitive issue for the mayor?
It’s partly about the walkway. The City had boasted before the referendum in 2010, “The new bridge will be a world-class landmark. Designed by renowned bridge architects Wilkinson Eyre, the replacement design is one of a kind and will allow you to walk through the rolling mechanism while the bridge raises.” That’s no longer true. Shouldn’t councillors have been consulted?
But there’s more at stake. The burning questions are: Was this change intentionally concealed from councillors and the public? If so, why? And by whom?
On March 15, when a slim majority of City councillors decided to approve spending $93 million on a new bridge, there had been plenty of opportunities for full disclosure. Joost Meyboom of MMM Group, the City’s prime consultant on the project, the bridge’s architect Sebastien Ricard of Wilkinson Eyre Architects, and the City’s project director Mike Lai all had the perfect opportunity to acknowledge the design changes the bridge had undergone and the effect those would have on its functionality and cost.
Instead, there was an attempt to hide the design changes. The renderings presented were years old—from the era when it was going to be built in 17 months. Slides of complex construction drawings in which the changes appeared were given little or no explanation and were shown only briefly. There was no mention of the change in status of the walkway “through the rolling mechanism while the bridge raises.” Why were these changes hidden?
And now the plot thickens. While the mayor says councillors were informed on February 7, Focus has learned the design changes were made in July 2011.
Architectural drawings produced by Wilkinson Eyre’s office in London on July 27, 2011 show the footprint of the main pier had doubled in size compared with drawings circulated a month before, and the “walk through the rolling mechanism while the bridge raises” had been cut from the plan. The project’s inner circle must have known at that time the bridge’s cost was going to rise dramatically. More on this later.
Since these substantial changes to the bridge’s functionality and cost occurred last July, is it possible City Manager Stephens was unaware of the changes and their cost implications when she said last October that the project “continues to be within the budget of $77 million”? Is it possible that project director Lai neglected to tell her? Stephens is the chair of the project’s steering committee, and as such she would have been at the centre of any exchange of information. She did not respond to a request for information from Focus.
Did Mayor Fortin know about these changes and the cost implications before November’s civic elections? Is it possible the City manager didn’t inform the mayor? Fortin, too, failed to respond to a request for information.
Did Stephens and Fortin withhold the information because it might have changed the outcome of the election? A risk management workshop held by the City in January 2011 had identified a “change of council members” as a definite risk to the successful completion of the project. The suggested mitigation strategy for this risk was “internal communication,” which, I believe, is code for “circle the wagons.”
Had voters known before the election that the cost of the project had climbed by $16 million, would other pro-replacement councillors have lost their seats? In that election, three pro-replacement councillors, including Lucas, lost their place at the council table. The project now hangs by a political thread; the council is split 5 to 4. One Lucas-like defection from the mayor’s team and a Plan B will need to materialize.
That this design change took place eight months before Fortin says councillors were alerted has more serious implications than what-if ruminations on last November’s election. It’s now clear that Meyboom, Lai, Stephens and Fortin have been sitting on information that, had it been disclosed eight months ago, might very well have provided both the impetus and the time to develop a Plan B. And the question arises: If they would conceal this, what else has been hidden?
Is the real cost still being hidden?
Last October, Stephens said the project would cost $77 million. Five months later it was $93 million. The City’s accounting of this price increase is confused. For example, consider construction costs. In one document, the City says the increase in construction costs is $9.7 million. But in another document, released the same week, they say it’s $7.6 million. In both cases, overall costs total “$92.8 million.” How can both be true? Was one of these numbers—or both—pulled from a hat?
A few weeks before the revelation that costs had climbed by $15.8 million, Fortin announced $16.5 million in Gas Tax funding had been approved by the federal and provincial governments. Was the $15.8 million cost increase simply calibrated to match the increase in available funding?
There’s reason to believe that’s exactly what the City has done.
A planning document for the bridge attached to an email dated July 6, 2011 (obtained through an FOI request) shows the main pier having a footprint of roughly 2000 square feet. But an architectural drawing released recently by the City shows that pier has almost doubled in size. The pier, or more properly, the pier building, is not simply a big, solid block of reinforced concrete, as with the existing bridge. It’s a six-storey-high reinforced concrete structure that would need to be built to exceedingly high construction standards. This would be a much more complex and expensive project than, say, an ordinary 6-storey residential or commercial building.
For one thing, the pier building would have to support 2700 metric tonnes of steel perched on its “roof,” and it would need to do this without being damaged by the ground waves of a magnitude 8.5 earthquake. And, since the bottom half of the pier building would be submerged, the structure would have to be built to remain perfectly watertight for the next 100 years. Inside, the pier building would be a vast complex of gear beds, stairways, electrical equipment and a yawning open space through which the 840-tonne counterweight fixed to the underside of the bridge deck would swing when the bridge is raised or lowered. The pier building would sit on several rows of three-foot-diameter steel pipes filled with steel-reinforced concrete, the pipes socketed deep into bedrock.
Because this complex building would have to be built inside waterproof coffer dams, its construction would be complicated, painstakingly slow and expensive. Previous to the redesign, the cost of the pier building had been estimated at about $10 million. Assuming that cost was not underestimated, doubling the size of this very expensive building would reasonably be expected to double the cost to $20 million.
In spite of these obvious upward pressures on price, Meyboom’s latest estimate has the cost of the bridge’s two piers dropping by $1.6 million. Is that believable?
The redesign also changed the geometry of the bridge’s moving parts (one of which is over 200 feet long) in such a way that their fabrication would require what bridge engineer Frank Nelson has called “aerospace tolerances.” Nelson says that would introduce the possibility that bids to build the bridge would include “risk pricing,” potentially blowing whatever budget the promoters were hoping for.
All this suggests that the magnitude of the recent cost increase was simply a reflection of the Gas Tax funding getting official approval from Ottawa, not some careful new determination of costs based on a refinement of the design, as suggested by Meyboom.
And a close examination of the recently-acknowledged costs doesn’t instill much confidence either.
Was the $77-million estimate faked?
In explaining to councillors why the cost of the new bridge had risen from $77 million to $93 million, Joost Meyboom identified “project management and engineering” as one of the two main culprits. That cost rose from $7.4 million to $13.6 million.
Why did the amount engineering companies like Meyboom’s will receive almost double? Meyboom has admitted he underestimated a number of predictable costs, such as the cost of obtaining approvals and permits, but has given no details as to how or why that happened. It is difficult to explain. In the June 2010 estimate of $77 million, which was peer-reviewed by Stantec Consulting, “approvals and permits” are missing altogether. The peer reviewer, Stantec’s Andrew Rushforth, failed to notice this even though, at the time the estimate was done, the cost of approvals and permits for the project had already reached $320,000. And who had received that $320,000? Rushforth’s Stantec Consulting. To add insult to injury, Stantec received close to $50,000 for its “peer review.”
Of the six categories of work that Meyboom says contributed to the $6.2 million increase in project management and engineering, none had been included in the $77 million estimate.
What possible motive could there have been to forget whole categories of costs back in 2010? It’s well known that the City strongly favoured building a new bridge; the record is crystal clear on that. But part of the community had expressed a preference to rehabilitate the existing bridge. Perhaps the strongest part of their argument was that rehabilitation would be less expensive than building a signature bridge with an unproven mechanical design. Indeed, in an unpublished survey (obtained through FOI) conducted by Ipsos for the City in April 2010, before the $77 million cost estimate was finalized, the expense of a new bridge was identified as the most important concern Victoria residents had about the replacement option. So the City knew in advance it needed to prove a new bridge would be less expensive than a rehabilitated bridge.
The bridge promoters were motivated to underestimate the price of a new bridge. The costs they suppressed are now coming to the surface.
Underestimating costs is just one of the tricks the promoters used to move their project forward. They have been just as effective at using the threat of not meeting timelines to shape the project to meet their desired ends.
Phony deadlines, too?
Philippe Lucas is not alone in his disappointment over the loss of rail from the project, which he attributes to his fellow councillors not backing his motions. Although Lucas believed councillors were making the big decisions, they were actually just rubber-stamping City staff recommendations.
Those recommendations, when they involved major turning points in the project, have been in lockstep with Meyboom’s advice. And the paper trail shows it was an arguable piece of advice from Meyboom about the extra time it would take if rail were included in the project that led to the recommendation to take rail off the bridge.
Let’s go back to February 2011. City council had approved spending up to $700,000 on a parallel design process that would have allowed rail on the bridge should additional funding come through in time. On February 4, an email exchange (obtained through FOI) between Meyboom and Lai took place. Lai, referring to a new schedule Meyboom had produced, asked Meyboom, “Why has the timeline changed for the rail-in option from end 2014/early 2015 to a year later?” Meyboom told Lai that including rail on the bridge would add five months to its construction. As well, he said, “After completion of the bridge an additional seven months is estimated to install track, the new rail station and the parking lot for the rail station.”
Meyboom’s rail-in schedule would have pushed completion very close to the March 2016 deadline the City had said it needed to meet to receive the full $21 million in Build Canada funding. Lai took that information back to councillors and told them that although nearly half of the funding needed for rail could be available from the CRD, it might take “four to six months” to have it approved. So Lai recommended rail be dropped from the project, partly on the basis that, he wrote, “If timelines are not met, there is a risk of losing the $21 million in federal funding.”
Terrified of losing that money, councillors approved Lai’s recommendation and the City ended their search for additional funding. And that was the end of rail.
But there are two logical disconnects in Meyboom’s advice and Lai’s recommendation. First, Meyboom and Lai are the same crew that insisted in 2009 the entire project, including rail and a longer bascule leaf, could be completed in 17 months. That plan was only halted when the provincial government refused to contribute funding. But at the time that Lai was making his recommendation to council about rail in March 2011, they had 60 months to build the bridge. If the bridge with rail on it could be built in 17 months, why not in 60 months?
Second, why would “laying track” and building a new train station and parking lot need to be left until the bridge was completed? Why not do this work concurrently with building the bridge?
Was concern about missing the funding deadline used to get rail off the bridge because there was some other motivation in play?
Perhaps things weren’t exactly as they seemed to Lucas and his fellow councillors. At exactly the same time as council was voting to take rail off the bridge, Pacific Liaicon and Associates were putting the finishing touches on a report for BC Transit that would go on to recommend building a $950 million LRT using the Douglas Street corridor from Downtown to Uptown, and then west to Langford. An option competing with the LRT option is commuter rail from Downtown to Langford using the existing E&N rail bed via the Johnson Street Bridge. The cost of that project has been ball-parked by the BC Ministry of Transportation at between $69.5 million and $166 million. If a new bridge had included rail, momentum would have developed to utilize that capacity; commuter rail’s stock would rise. With no rail on the bridge, it would fall. And LRT’s stock would rise.
Pacific Liaicon is a division of SNC Lavalin, the Quebec-based engineering and construction giant that specializes in building LRT systems. Kevin Mahoney, the chair of BC Transit’s board of directors, is also on the board of Intransit BC, the company that owns and operates Vancouver’s Canada Line. Intransit is owned one-third by SNC Lavalin. SNC Lavalin seems to have at least a couple of important ducks lined up that could give it the inside track on an LRT project in Victoria. But are those the only ducks?
Meyboom’s company, MMM Group, is currently partnering with SNC Lavalin in two separate bids for LRT projects: the Evergreen Line in Vancouver and the Ottawa LRT Project. And SNC Lavalin and MMM Group are partners in building the $800 million Calgary West LRT. Meyboom himself is playing a prominent role in that project. According to MMM, his responsibilities in Calgary include “management of the [LRT] structural design team, resolution of project specific technical issues, and management of a very constrained design schedule.”
Putting all this together, it appears Meyboom gave advice about timing that helped take rail off the new bridge. That increased the chances that LRT would be built in Victoria. And, if MMM partners with SNC Lavalin in building an LRT project in Victoria, like they have in Calgary, MMM would obviously benefit.
I asked Meyboom if he had divulged to the City of Victoria his company’s working relationship with SNC Lavalin and the apparent conflict of interest that put him in regarding his advice about rail on the new bridge. Meyboom did not respond.
The threat of “not meeting timelines” and losing funding, which was used so effectively to get rail off the bridge, is now being used by the City to dismiss calls for a time out on the project so other options can be considered. But would the City really lose all—or any—of the funding?
Does the City need a Plan B?
The latest project schedule from the City calls for a contract to be signed with a builder this fall. They say they have prequalified eight companies. Councillors hope that at least one of those will find a way to build the Wilkinson Eyre design for $93 million. According to councillor Lisa Helps “there’s little appetite” around the table for spending more than $93 million. But if costs have been significantly underestimated, what will happen? I posed that question to Ross Crockford, whose watchdog organization johnsonstreetbridge.org has been monitoring the project closely.
“The big risk for council,” Crockford said, “is that they’ll have no option but to keep going with the current bridge, regardless of the cost. City staff have already said, repeatedly, that any delay ‘jeopardizes’ federal funding. So if contractors tell the City this summer that they can only build the bridge for $100 million or more, council will be under pressure to approve the increase.”
Crockford thinks councillors need to act now to ensure there’s a Plan B. “Council will have to spend a little money to create a backup plan. But, without one, the risk is great that there will be ever-increasing costs for the bridge itself.”
Mayor Fortin has rejected any consideration of a Plan B on the grounds that would somehow put at risk $37.5 million in funding, an echo of Lai’s oft-used “If timelines are not met...” threat. But even if time is tight—which is in some doubt—what would happen if construction went past March, 2016, the deadline for the $21 million Build Canada funding?
“First of all,” Crockford says, “the federal contribution agreement says the City can ask for a deadline extension. The request goes to a four-person committee—and two of them are City appointees. So the request would likely succeed.” But what happens if the City isn’t given an extension?
Crockford says the City needs someone besides the project engineers to advise them. “It’s not clear what happens if the City doesn’t get an extension, and is a year or two late. The agreement does say that if the City ‘has not completed the Project on the terms and conditions herein,’ the feds could demand all their money back. But they could also just turn off the financial taps, which would be OK, because the City plans to spend nearly all the federal money by 2015 anyway. Council needs advice about this from its lawyers, not its engineers.”
The project will also receive $16.5 million from the Gas Tax Fund. Would that be at risk if council chooses to go to a Plan B?
Not likely. According to Paul Taylor, a spokesperson for the UBCM, which administers Gas Tax Fund grants in BC, “A completion date is included in each funding agreement based on the recipient’s estimate of the time necessary to complete the project. This date, though, can be amended to provide additional time if there are delays in construction.”
The City also says that pushing on with Plan A is the only way to ensure “$10 million in sunk costs” won’t be wasted. Crockford disagrees. “A lot of the money that’s already spent has been for acquiring land, geotechnical analysis, permits, moving the Telus duct, and removing the rail span, all of which would happen no matter what bridge gets built. The main thing we’d lose is the architects’ work, which City staff have pegged at $2 million. It may be worth eating that to get a standard design with a proven record of durability. There don’t seem to be any current examples of bridges with the new open-wheels-on-rollers mechanism they created. So it’s impossible to predict how much it will cost, how well it will work, or how long it will last.”
Crockford thinks there’s just too many unanswered questions about the project for comfort and, along with several councillors, is calling for an “independent audit” of the project: “City staff have repeatedly withheld key information, and council can’t rely on them to provide all the options. An independent audit is the only way council will really find out if the City can build a simpler, cheaper bridge, and still get all the federal funding.”
ON MARCH 14, Stantec’s Andrew Rushforth wrote a letter to the City’s Director of Engineering and Public Works Dwayne Kalynchuk. The letter was handed over to City councillors without explanation a few days later and a copy made it's way into my hands.
Rushforth’s letter began, “As per your request, this letter outlines the issues relating to possible rehabilitation of the Johnson Street Highway Bascule Bridge.” Yes, that’s correct: r-e-h-a-b-i-l-i-t-a-t-i-o-n. Rushforth went on to reiterate what was already known: The existing bridge can be rehabilitated. Is this the City's Plan B?
They could do worse. According to bridge engineer Frank Nelson, the new bridge “will likely exceed $100 million by the time it goes to construction. Rehabilitation, even including the engineering costs to date...would be half that and would keep the look and the feel of the harbour that draws many visitors.”
Unfortunately, Nelson’s “half that” estimate was made before the railway bridge was destroyed. Debacle indeed.
David Broadland is the publisher of Focus