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The budget for the North Shore’s new sewage treatment plant has almost quadrupled in size, Metro Vancouver has revealed – to almost $4 billion.
Metro Vancouver released the updated costs for the North Shore Wastewater Treatment plant project on Friday afternoon, that put revised project costs at $3.86 billion – over $2.8 billion more than the last budget of $1.058 billion in 2021.
North Shore taxpayers are expected to be on the hook for a substantial part of that.
Preliminary figures provided Friday put the increased costs to “average” households in North and West Vancouver at $725 per year for the next 30 years. Taxpayers in other regions of the Lower Mainland will also have to pay more for the project, in amounts ranging from $70 a year to $140 a year for 15 years.
Details of exactly who will pay what and when those increases will hit North Shore taxpayers will be discussed at Metro’s budget meeting in April. The amounts could also change if the federal and provincial governments agree to contribute more cash to the problem-plagued project.
“We are acutely aware of concerns around how this cost may impact the property taxes and utility rates of residents on the North Shore in particular,” said Metro Vancouver Commissioner Jerry Dobrovolny.
Budget approved Friday by Metro board
The Metro Vancouver board voted to approve the new budget for the North Shore Wastewater Treatment Plant in a closed-door meeting Friday morning before a public announcement was made Friday afternoon.
The new cost projections come after a special task force was struck to examine problems facing the project and make recommendations to the board.
The massive ballooning in costs of the project have been the result of both a huge escalation in project costs – including everything from labour to the cost of concrete, pipe and electrical wire – and having to go back and fix “a tremendous number of deficiencies” left by the project’s original contractor, Acciona, said Dobrovolny.
Problems included fundamental flaws in the way the project was built, including significant structural deficiencies, according to Metro. The regional government indicated the project was also far less advanced than Metro had been led to believe by Acciona.
The North Shore sewage plant is now the largest project the regional government has ever undertaken.
Dobrovolny acknowledged Friday, “It’s a huge project. It’s a very large budget.”
But he stressed, “This project and this program are not optional.”
The existing Lions Gate sewage treatment plant is at the end of its life and its basic level of primary treatment does not meet federal environmental standards, he said.
About $600 million has already been spent on the project, he added. Half of the 80,000 cubic metres of concrete that will go into the project has been completed at this point, with 40,000 cubic metres still to go.
“The reality is, the cost to deliver the program has changed significantly since its initial estimate 13 years ago,” said Dobrovolny. He said the new budget took into consideration the cumulative impacts of inflation, competition for labour, and “the significant work that was needed to address design and construction deficiencies.”
New plant won't be finished until 2030
Metro said Friday it now expects work on the sewage treatment plant to wrap up in 2030 – 10 years behind the original schedule. When finished, the plant will provide sewage treatment to a future population of about 300,000 residents of the North Shore.
Metro officials declined to comment Friday on how the project was built on the North Vancouver site without such large structural problems being flagged earlier.
In April 2019, the District of North Vancouver slapped a stop-work order on the site after the company building the plant, Acciona, terminated one of its leading geotechnical engineering contractors, Tetra Tech. That resulted in Tetra Tech filing a $20-million lawsuit.
The project has been further mired in controversy and multimillion-dollar lawsuits after Metro Vancouver terminated the design-build contract of its original contractor, Acciona, in the fall of 2021.
No political leaders were present at the announcement of the increased costs of the plant on Friday.
In an emailed statement Friday afternoon, District of North Vancouver Mayor Mike Little said “I am extremely frustrated with this project. Today in particular, I am bothered about the additional costs that the district taxpayers will be forced to absorb to get the North Shore Wastewater Treatment Plant completed and operational.”
Little added he was relieved the figures for the project had finally been shared with the public.
“Moving forward, we need to have a public conversation regionally about the impact of these high costs on our residents, especially at a time when nearly everyone is feeling a significant impact on household budgets.”
North Shore News columnist Kirk LaPointe first reported the scale of the cost overruns Metro faced on the project in September.
City of North Vancouver Mayor Linda Buchanan also issued a statement following the announcement Friday, saying she had "deep concerns" about the financial impact of the project on North Shore residents.
"I have had these concerns for some time, and have raised them repeatedly. I will continue to do so as the project moves forward," she said. “As a Metro Vancouver board director, I have to accept the decision of the board."
Buchanan said council is "working to fully understand the implications the board’s decision will have on residents and property owners. We are committed to working diligently to implement any possible mitigation tools.”
