With tenders for infrastructure projects coming in lower than budgeted, the City of Moose Jaw should pursue more work and go beyond what city hall initially planned, a city councillor says.
City administration told city council during the latter’s recent meeting that the contracts for paving and cast iron water main replacement came in below estimates, while the tender for sidewalk repairs was close to what city hall budgeted. This news excited Coun. Brian Swanson, who encouraged city administration to undertake more work.
“I make the point because it’s very rare when a municipal government finds itself in a position where it’s getting really good bids. Usually we’re the easy pickings, so to me, this is something we should take advantage of,” he said.
“In a year when we could most take advantage of an ultra-competitive environment from contractors, we should be looking to fill our plates with tenders and go beyond what we budgeted because we’re low on the ones we have. We should be going after more.”
However, it doesn’t appear as if city council can do that since it is facing shortfalls in revenue, Swanson remarked. It had budgeted for $5.5 million in revenue for the capital budget. But with $49 million in guarantee investment certificates (GICs) generating $1.7 million at 2.35 per cent, this leaves council with a shortfall of $3.9 million.
He pointed out that a report from city manager Jim Puffalt indicated city administration hopes it won’t have to withdraw any funds from its stock investments during the next couple of months to cover the shortfalls.
“It’s (the situation) not as rosy; 2.35 per cent on $49 million (is) significantly less than what we were earning before. We’re not in a position where we can do a drawdown in capital reserves because they are in a negative position,” Swanson said, before reiterating that city council has the opportunity to do more infrastructure work with lower tender contracts.
There is the potential to put 25-per-cent more funding onto the cast iron and pavement projects, said Puffalt. The provincial government has provided an additional $4.8 million in funding through the Municipal Economic Enhancement Program (MEEP), while there is federal transit funding — up to $6 million — that could go toward the cast iron project. This would allow city administration to complete more work this year.
“We delayed a lot of projects to focus on the primary areas and that was why we did that … ,” he continued. “When we get into the capital funding discussion, those will be the things we recommend and will come back to council in June with the process and a further discussion on capital programming.”
The next regular council meeting is Monday, June 15.
