Consider curbing contingency: Cipolla
It might not be a four-letter word, but it’s one an Orillia councillor would like to see banished, or least used less often.
Coun. Ralph Cipolla said staff relies too heavily on including large contingency fees with work it tenders out and that council ultimately ends up approving.
According to Cipolla, too often contingency fees — that are employed should a project run into something unexpected — are spent, meaning a number of projects come in overbudget.
“We have too many of these projects that include the five per cent or 10% contingency,” he said, noting projects that actually do run into problems should be reported back to council so elected officials can be more involved in the process.
“Council needs to have some say. Contingencies are way overboard.”
During a council committee meeting Monday, councillors voted to accept a staff report recommending Bradanick Construction Services Inc. be awarded a contract to design and construct a new washroom facility in Tudhope Park to replace the Jerry Udell Fieldhouse.
The $1.672-million contract includes a contingency of nearly $80,000.
The project had been earlier approved under the capital budget at costing $1.62 million, but a staff report noted “the requirements of various approval agencies for utility services” increased the project’s overall cost.
“The only reason it’s overbudget is because they added the five per cent contingency,” Cipolla said.
Councillors opted to go with Bradanick, rejecting two other bids with one being higher ($2.14-million) and another lower ($1.48-million).
Coun. Ted Emond, who chairs council committee meetings, said staff looks at a number of criteria when deciding which tender option to recommend to council with cost just being one factor.
Emond said contingencies serve a valuable purpose and remain a normal part of doing business.
“If things happen that aren’t expected they don’t have to come back to council,” he said, noting as an example crews working to build the city’s new recreation centre have already found things they hadn’t anticipated.
“We’re all concerned about the amount of money it costs to run our municipality. These (contingencies) give staff the flexibility to move.”