British Columbia

Calls for change at Prince George city hall as more than $10M lost to ballooning construction costs

Four projects have cost Prince George, B.C., taxpayers a combined $13 million more than expected over the past three years.

Budgetary overruns on four projects have cost Prince George, B.C., taxpayers $13.4M since 2017

Construction of a parkade serving new downtown condos in Prince George, B.C., had gone $5.3 million over the original $12.6 million budget by the end of 2019. (Andrew Kurjata/CBC)

Skyrocketing costs set off calls for change at Prince George city hall this week, with several councillors demanding more oversight of public money after discovering construction of a downtown parkade has already gone more than $5 million over budget.

An annual report presented to council Monday revealed the project, which was originally slated to come in at $12.6 million, had already cost $17.9 million by the end of 2019 — with construction still underway.

"I'm so unhappy with this," Coun. Brian Skakun said of the overruns. "I'm just wondering how we got it so wrong?" 

The parkade is the latest in a series of high-profile projects to go significantly over budget in the past three years. In 2017, construction of a new bridge went from a budgeted $3.1 million to $6.8 million.

In 2019, the cost of upgrading an existing downtown parkade went from $2.8 to $5.2 million. And in June of this year, construction of a new $15 million firehall was revealed to be $2 million over budget. That's a combined total of $13.4 million in just over three years, with two of the projects still pending completion.

Coun. Kyle Sampson said the series of overruns made him uncomfortable voting in favour of future projects.

"How can I believe that when we get these proposals brought forward to council that they're going to be coming in on budget?" he asked. "The more and more of these we see, the harder that becomes."

"We have millions of dollars, in my opinion, going out the door that should have never gone out the door," Skakun said.

Skakun called for a full accounting of the parkade's cost overruns, which planning and development manager Ian Wells said could be attributed to structural problems discovered after construction started, as well as steel tariffs imposed by U.S. president Donald Trump raising the costs of materials.

But Coun. Cori Ramsay, who is serving her first term in office, said the larger problem lies with a system in which elected officials have delegated authority to city staff to approve cost overruns without consulting council.

Under the process, the city manager can make budgetary amendments of up to five per cent of the city's total operating costs without council approval.

First term councillors Kyle Sampson and Cori Ramsay both expressed concern about the number of cost overruns they've seen at city hall. (Kyle Sampson/Cori Ramsay)

"It's, I think, approximately $7 million [annually], but what we're seeing is the entirety of delegated authority being put on one project which, I don't think, was ever the intent," Ramsay told Daybreak North host Carolina de Ryk. "It's unfortunate."

Ramsay said while it makes sense to give city staff some leeway to make decisions without waiting for a vote from council, the current system needs amending so elected officials are more informed and involved as project costs evolve — particularly as people are struggling to deal with the financial implications of COVID-19.

"We're trying to get through these challenging times, and if our reserves have been drained an additional $5.3 million, is council going to have to review, again, decisions around reopening arenas and reopening the pools?" she asked. "These aren't decisions I want to redo. They were hard enough the first time."

Ramsay said she's already asked for a review of how delegated authority in the city works, with the intention of scaling back the power the city manager has to amend the budget. 

"I don't think it's really fair for the administration to wear this. This was in their decision-making capabilities," she said. "My hope is we find something that works better for both of us."

After Prince George councillors found out the cost of a new parkade has gone more than $5 million over-budget, Cori Ramsay says it's time for elected officials to have a more hands-on approach to managing major projects. 7:57

About the Author

Andrew Kurjata

CBC Prince George | @akurjata

Andrew Kurjata is an award-winning journalist covering Northern British Columbia for CBC Radio and cbc.ca, situated in unceded Lheidli T'enneh territory in Prince George. You can email him at andrew.kurjata@cbc.ca.

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