After years of promises, city blows LRT deadline with a shrug
David Reevely David Reevely
Published on: February 6, 2018 | Last Updated: February 6, 2018 6:28 PM EST
Ottawa’s light-rail project is six months late and well, what are you gonna do? These things happen.
The rhetoric has shifted a bit, maybe you’ve noticed, from “On time and on budget!” to “¯\_(ツ)_/¯”.
The ominous rumbling began almost as soon as city council approved a budget for 2018 that assumed trains would start rolling at the beginning of July, as has been planned and promised for years. The Rideau Street sinkhole and numerous other construction quirks and quiggles had the project far enough behind schedule that that July target was in doubt.
“I don’t call it late, I call it an adjustment of the date, for all the right reasons,” OC Transpo’s general manager John Manconi said at the time.
Now we know that the start date is being adjusted, for all the right reasons, to November. And we’re generously forgoing a million-dollar penalty that adjustment, for all the right reasons, entitles us to.
The city’s contract with Rideau Transit Group is clear: There’d be a “revenue service availability date,” the day the builders would hand over the keys with the assurance that the trains were ready to roll, and if they missed it, they’d owe us $1 million.
The city and RTG agreed that May 24, 2018 would be that date (the city’s own preparations and rehearsals would take a few weeks beyond that). RTG supposedly said they thought they could hit it. The city said no, we don’t think so, take until November.
A six-month delay on a project of this scale isn’t nuts. If we’d heard in 2011 that trains would be as close to carrying passengers in 2018 as they are, most of us would have thought that was pretty good. But it is a disappointment relative to all the talk in the intervening years about how well everything was going because of how great a deal the city made with its great group of tunnellers and track-layers.
Manconi is always careful. He’s not been the guy boasting that the rail project is on time and on budget — just that RTG had every incentive to deliver.
The boaster has always been Mayor Jim Watson, who’s hardly ever mentioned the project without reminding his listeners of its on-timeness and on-budgetness. When Watson announced last March he’d run for re-election, the triumph of the LRT was the second thing he touted after keeping tax increases small, echoing lines in every state-of-the-city address he’s given since construction started.
“(A)fter years of false starts, lawsuits and cancellations, we are now on the verge of witnessing the opening of our new Light Rail Transit (LRT) system, on time and on budget,” he wrote.
Or, look, six months late. Whatever. We want the right starting date, not an arbitrary one. You don’t want the train to be unsafe, do you?
(That’s a rhetorical trick to watch for: the idea that holding the mayor and the city to the standard they’ve invited is merely advocating recklessness.)
Back-of-the-envelope math ($2.1 billion, divided by five years of 365 days each) says the LRT construction contract is worth something like $1.1 million a day. When top city people say RTG has much bigger incentives to get the job done than a one-off $1-million penalty, that’s what they’re talking about. It’s a paltry fine in such a massive budget.
Still, a million bucks is a million bucks. City councillors fought an ugly little battle last fall, with backstabbing and betrayals, over $8 million in pothole money. We’d find something to do with it.
The agreement transfers all the project’s risks to RTG, for anything that goes wrong that isn’t obviously the city’s fault. Wetter ground than expected? RTG’s problem. The price of concrete shoots up? RTG’s problem. Sinkholes? RTG’s problem, thank goodness.
The extra months of work — time during which RTG’s workers have to be paid, its equipment not used on other jobs, its lights kept on — are also all at RTG’s expense.
We made RTG borrow money from private lenders to finance its own work, expecting that their oversight of their investment would be better than anything we could do. (That raised the price of the project by $165 million, but it gave us yet more guarantees the consortium would deliver.) RTG isn’t getting its final construction payments until construction is complete, and making things right with its lenders in the meantime is RTG’s problem, not ours.
That sums up the protection we were promised. We appear to be getting it.
The thing is, nevertheless, late. We’re getting six more months of bus-clogged streets, six more months of construction-related traffic jams, six more months of not having the thing we’re paying all this money for. The million dollars wouldn’t be much compensation for all that but it would have been nice.
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