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West Kelowna  

Why has the cost of the Rose Valley Water Treatment Plant jumped from $49M to $75M

Rising cost of water plant

Some residents in West Kelowna are demanding answers as to why the cost of constructing the new Rose Valley Water Treatment Plant has jumped by about $26 million from original estimates.

Estimates five years ago pegged the cost of a new water treatment plant at $49 million, $41 million of which was provided through a federal-provincial grant.

Those costs eventually rose to $53.5 million, then, the current $75 million.

According to some residents, the city has been secretive as to why the costs have jumped, citing costs of water treatment plants in other similar sized cities such as Penticton ($35M) and Vernon ($41M).

West Kelowna Chief Administrative Officer Paul Gipps told Castanet News figures used to determine costs have come straight from an engineering firm experienced in building water treatment plants.

"It's not a number the city just grabbed," he said.

Gipps says, while he doesn't know enough about the water plants in other cities, he does believe given recent plants built in similar sized communities, he's comfortable with the cost estimate.

He adds the original estimate was based on a concept plan. The city didn't have land at the time so design and construction estimates were not site specific.

Once the property was purchased for just under $1 million, Gipps says site specific design work could be undertaken.

"What we do know is that over time, costs have only gone up. We've added to the project because we've built in an interconnect. We've added an extra $7 million to interconnect other parts of the city which is extra piping that wasn't planned originally," he said.

"Again, we're relying on engineering firms. They're the specialists. They're the ones that came up with these numbers, and now at full design they are saying here is what it's going to cost, and here's our level of certainty on what it's going to cost."

The additional cost of design and construction means those water users will pay an additional $34 to cover the extra borrowing costs.

However, Gipps says that number could come down if the project comes in under budget.

"We are certainly hopeful that our contract prices will come in less. Our first contract came in significantly less than we had originally budgeted.

"We are hoping the big contract will come in along the same lines, but again, I would rather keep the number the engineering firm gave us, then see where it comes in."

Affected residents have all been mailed a Subject to Petition Against package outlining the borrowing procedure and cost of repayment.

Those residents have until Oct. 2 to respond if they are against the borrowing and repayment plan.



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