A week after confirming that Ottawa’s new light-rail line has fallen behind schedule, the city has published preliminary figures that put a price tag on the delay.
Rideau Transit Group, the construction consortium building the rail network, is expected to incur costs of between $8 million and $10 million a month, according to a memo released by the city Wednesday morning.
That’s on top of the costs related to the 2016 Rideau Street sinkhole that’s blamed for the six-month delay in contractors turning the rapid transit network over to city officials. Originally scheduled for May, that’s now slated to happen on Nov. 2. The light-rail line, which runs from Tunney’s Pasture to Blair Road, will then open to the public by the end of November.
RTG will also have to deal with the deferral of a $200-million payment from the city, which is not payable until the contractors hand over the light-rail line.
Meanwhile, the city says it’s spending an additional $1.9 million a month to maintain LRT-related detours but expects that figure to rise as additional costs stemming from lane closures and construction monitoring are factored in.
City officials say they plan to seek reimbursement for those additional expenses.
“It is the city’s position that RTG needs to cover our costs for the delay,” city manager Steve Kanellakos wrote in the memo.
Ottawa’s top bureaucrat also explained why RTG would not be forced to pay a $1-million fine for missing the May deadline as some city councillors believed.
The light-rail project agreement requires the contractors to notify the city at least 180 days in advance of when they plan to turn over the rail line. Once the contractors commit to a date, they’re on the hook for paying $1 million in damages to the city if they miss the deadline, the document states.
Kanellakos said Wednesday that the city needs time to “mobilize” and prepare for the light-rail line entering service. The $1-million fine was intended to compensate the city for incurring those costs if the contractors subsequently changed the date.
“The contract is working just as it was designed to work,” the city manager stated.