By Mark Squibb/October 7, 2022
A recent change order that reflects yet another cost increase in materials has Mount Pearl councillor Bill Antle asking how the City will maintain a balanced budget when the price of everything continues to rise.
The change order to the Smallwood Drive Asphalt Renewal project was required to account for the most recent increase in the cost of liquid asphalt.
“As a result of fluctuating fuel prices, the cost of liquid asphalt and clear diesel has increased since the original contract was awarded,” said councillor Isabelle Fry, who noted that change orders due to cost increases have been common this summer.
The price increase resulted in an additional cost of $11,511, HST Included.
Councillor Mark Rice said cost increases seem to be the way of the future for the time being, a point on which councillor Antle concurred.
Antle was concerned about the budgetary implications of the repeated price increases.
“If this is an indication of things to happen, and we run a balanced budget, if every contract is coming in five or 10 percent over, how is that affecting our budget?” asked the councillor. “Can we continue doing the same work? If this an indication, like councillor Rice said, and all our contracts are getting higher and higher, how do we maintain that budget?”
Director of Infrastructure and Public Works Gerry Antle said that regarding this specific change order, liquid asphalt prices are based on petroleum price changes from the date of the contract award.
“So, for contracts that are current today, for example, the pricing would be reflective of what today’s prices are,” said the director. “The increases that we have seen, over the past year or so, reflects that change. As we go forward, we’ll have budgets rbought to council and our estimated costs of construction will reflect the current cost prices that we see now.”
Director Antle said the City will work within those budgets so that the scope of work will fit the budget council has approved.
Any price decreases, he added, will also be reflected in future infrastructure projects.
Director Antle did allow that, yes, the “amount of work we can accomplish within the budget is a lower volume of work, unless council choosees to increase the budget.”
Meanwhile, a second change order for the same project was also approved during the meeting, this for additional storm sewer materials.
“During construction on Smallwood Drive asphalt renewal, it was noted that a storm sewer manhole located on Smallwood Drive required a grade adjustment,” said Fry. “So, therefore, the contractor, Modern Paving, was required to install new storm sewer materials, totaling $1,903.57, and this includes HST.”
The change order was approved unanimously, with Mayor Dave Aker nothing in this case it was just a small one.
