An amendment tabled by Councillors Lana Mitchell and Justine Mallah will see a decision on the proposed twin-pad arena and community centre pushed back.
Mallah tells BayToday the idea behind the amendment is for North Bay City Council members to discuss the three options presented in a report from CAO John Severino in more detail at the committee level. Mallah adds a meeting will be called as soon as possible to address the matter.
See related: Council to mull 3 options for stalled arena project
In his report, Severino provides background information on the project, the low tender, current general market conditions, and community impacts of an unplanned closure of West Ferris Arena. It also summarizes three potential options for council’s consideration.
The unveiling of the bids in mid-June ended any hope of keeping construction costs near the estimate of approximately $44 million as three contractors submitted tenders ranging from $70.8 million to $82.3 million. Add another $8 million in design and ancillary costs to the low bid and it is now a nearly $80-million project.
See related: Low bid is $70.8M for construction of community centre
The project was to be constructed at the Steve Omischl Sports Complex on Lakeshore Drive.
The plan for Tuesday's meeting was for the council to choose from one of the three options (see below) presented in the report and direct staff to complete the work necessary to implement the selected option. Now, discussions will take place at the committee level before returning to a regular council meeting for a vote.
Option 1, Building Redesign
According to the report, "This option involves cancelling the tender and initiating a redesign process of the building. The building redesign would make use of the existing functional program and site but would be constrained by the existing species at risk avoidance permit. This option would allow the project delivery
method to be changed if benefits are anticipated."
Risks:
- Price escalation due to inflation at current rates (12.3 per cent annualized) could result in adding $8.5 million to the build cost over the next year.
- Moves project completion out to 2027.
- Delays in project delivery increase the risk of unplanned closure of West Ferris Arena.
- Price reductions available through redesign without program cuts are minimal.
Option 2, Project Redesign:
This option involves cancelling the tender and initiating a redesign process of the building and the building function. This would make use of the existing site but would revisit the functional program.
Risks:
- Price escalation due to inflation at current rates could add $8.5 million to the build cost per year.
- May move project completion out to 2029.
- Delays in project delivery increase the risk of unplanned closure of West Ferris Arena.
- Reduction/loss of certain program functions would reduce the utility of this facility and may not meet the needs of our stakeholders.
- Project delivery method changes would likely increase the risk of uncertainty in pricing.
"This option offers the opportunity to achieve meaningful cost reductions through cuts to the functional program. This approach introduces risk in the form of escalation costs due to inflation during the time it takes to redesign the project. This factor can significantly inflate construction prices, eroding any potential cost-saving benefits derived from cuts to the functional program.
"Significant reductions to the functional program will be required to achieve meaningful cost reductions while also overcoming inflationary pressures.
Public re-engagement is recommended as part of this option."
Option 3, Award the Contract:
This option involves awarding the tender and initiating construction. The project team would work with the contractor and consulting team to identify potential reductions in project cost upon award.
Risks:
- Price reductions available through value engineering are minimal.
- This would see construction completion in the fall of 2025 and would minimize the risk presented by inflation as well as an unplanned failure at West Ferris Arena.
See BayToday's poll on the future of the project
The City of North Bay issued a statement in June acknowledging all three bids had come in at least $20 million over budget. "The City had estimated the total project cost at $51.6 million, including design, contingencies, allowances, furniture, fixtures and equipment." The construction cost included an estimated 1.5 per cent inflationary escalation amount per quarter.
The lowest bid for the construction of the building, excluding the planned redesign of the Lakeshore Drive and Booth Road intersection, came in at $69.263 million or approximately $808 per square foot, according to the CAO's report, "which significantly exceeded the estimated cost. The square foot cost is within the range of community centre project awards in the last six to eight months in Ontario."
In December 2022, staff recommended the recently elected council "initiate the tendering for the construction of the multi-purpose community and recreation centre." In February, the majority of the council felt it was an effective way to move the project along while leaving itself a way out in the event the tenders come in too expensive for its liking.
See: Council approves new arena project
See also: More on council's decision to tender new community centre
North Bay City Council approved the project by a 6-5 vote in February while stressing the resulting financial implications of that move would ultimately decide whether or not to build. Councillors Maggie Horsfield, Lana Mitchell, Justine Mallah, Chris Mayne, Tanya Vrebosch and Mac Bain supported moving forward while Mayor Peter Chirico and Councillors Sara Inch, Mark King, Gary Gardiner and Jamie Lowery voted against going to tender.
