Toronto approves TTC plan for Spadina subway build reset

DailyCommercialNews.com
April 9, 2015
Richard Gilbert

Toronto city council has approved the Toronto Transit Commission’s (TTC) plan to reset construction on the Spadina subway extension by hiring a new third-party project manager, but the expedited tender process is opposed by the union representing TTC workers.

At a meeting on March 31, council voted 40-to-3 to increase its capital budget and 2016-2024 capital plan for the Toronto-York Spadina Subway Extension (TYSSE) project by $150 million. The cost increase will be split between the City of Toronto ($90 million) and the Regional Municipality of York ($60 million).

As a result, TTC CEO Andy Byford has been given final approval to implement a project reset plan. This involves taking control of the project away from the TTC's internal management team and hiring a new third-party construction manager, who will deliver the project by Dec. 31, 2017.

Byford's plan includes one additional year of existing project management at a cost of $70 million, as well as the third-party project manager at a cost of about $80 million to project completion. The $80 million cost involves the addition of consultant staff to be deployed along with the existing project team. It also includes incentives conditional upon meeting schedule, budget milestones and opening by the end of 2017.

This reset plan will use a sole source contract pending negotiations to minimize the procurement time.

The construction manager recommended to lead the TYSSE project has been kept confidential by the TTC and the City of Toronto. However, promises have been made to release this information to the public upon execution of an agreement.

In anticipation of this announcement, the Amalgamated Transit Union Local 113 claimed that Byford's plan, as it believes, to award an $80-million sole-source, no-bid contract to Bechtel corporation, is misguided.

"We hope that Council will correct this rash decision by the Commission to award a large contract to a company like Bechtel without the standard and sensible practice of evaluating bids from more than one company," said Bob Kinnear, president of the union in a statement.

"The extra time it will take to ensure we will get value for money will be nothing compared to the potential cost of a mistake that Bechtel has proven itself capable of."

Kinnear says it is a mistake to short circuit the public procurement process to gain a few months on the delivery of a critical piece of transportation infrastructure that will last more than a 100 years.

"We're not disputing that TTC management needs to be saved from its incompetence," said Kinnear.

"We're troubled, however, that a company with an apparently sketchy record like Bechtel is being cast as the saviour in this civic drama of taxpayer fleecing."

Byford fired Sameh Ghaley, TTC chief capital officer and Andy Bertolo, chief project manager, from their positions on the TYSSE project on March 19 to restore public confidence. A TTC report released on March 20 said the initial completion date at the end of 2016 and the budget are not achievable.

Initially, the cost of the 6.2 kilometre extension from Downsview Station to Pioneer Village Station in Toronto was estimated to be $1.5 billion. But, this was increased to $2.1 billion in 2006 when the extension was expanded 2.4 km from Pioneer Village Station to Vaughan Metropolitan Centre Station in York Region. The current cost of the project is $2.78 billion.

According to the union, Bechtel was the lead contractor in the Boston "Big Dig" tunnel and transit project that was initially estimated to cost $2.5 billion but ballooned to $14.6 billion.

Byford was directly responsible for hiring Bechtel to conduct a thorough in depth analysis of the project. The findings of this report were presented in February 2015.

The Amalgamated Transit Union Local 113 represents 10,000 TTC operations and maintenance staff.