Work on the Sam Ketcham pool upgrade project began earlier this month and already its budget needs to be increased by $1.4 million.
In a joint press release issued Tuesday, the Cariboo Regional District and the City said the new estimate anticipates a project cost of $13.1 million, including appropriate contingency funding, which is approximately 12 per cent over the initial cost estimate of $11.7 million.
The good news, however, is the increase will not cost taxpayers any more, the CRD and City said.
With the Federal Gas Tax grant of $4 million factored into the budget, they said accommodating a $13.1 million project can be achieved without a previously planned draw from the recreation function capital reserves and the anticipated borrowing will be reduced to $6.75 million with a term of 15 years.
The reduction in the principle amount borrowed saves $6.45 million, including $3.2 million in interest charges. Taxation increases over the term of the five-year financial plan have been reduced from one per cent per year, to zero per cent.
The CRD and City said the increase is required in light of the current project cost estimate and is considered to have a high level of accuracy based on final working drawings and the receipt of tenders to date.
“We are thankful to the funding partners for their contributions and support and the major positive impact their funds have on the project budget and that we will be able to significantly reduce the cost to local taxpayers,” said Central Cariboo Co-Chair and CRD director Joan Sorley.
Sorley said she is confident the project working group will continue to be diligent in ensuring all design details are the best value for the project and will take advantage of any other cost-saving opportunities.
Central Joint Committee co-chair Mayor Walt Cobb said the budget increase was disappointing, but not fully unexpected given the cost estimates have gone up since the initial concept plan in 2012.
“But it’s also critical that the project meets all the expectations of the community and the scope that was brought forward in the referendum and I’m glad this will be achieved while actually reducing costs for local taxpayers,” Cobb said.
To support the project, the CRD and City continue to pursue funding from other sources and have confirmed $250,000 from Northern Development Initiative Trust, $500,000 from the Canada 150 Federal Grant program, $427,500 in Regional District Community Works Funds for specific energy efficiency upgrades and $4 million from the Federal Gas Tax Strategic Priorities Fund.
These grants are in addition to the $500,000 donated by West Fraser to support the project in recognition of the long standing connection between the facility, the company and the Ketcham family.