Salt Shed Woes for City

 

The City of Wetaskiwin Aldermen were left with a very unpleasant taste of ‘salt and sand’ in their mouths at the June 25th Regular Council meeting.  Agenda item 12 b under New and Unfinished Business was brought forward and the following motion was proposed by Administration. “(I Move) That Administration proceed with the funding and agreement actions required to complete the Salt and Sand project.”
Fast forward to October 29th, 2012 and -- At the October 29th meeting, the Council of the City of Wetaskiwin has deemed it expedient and necessary to repeal Bylaw 1794 – 12. "Debenture Bylaw – Sand Salt Shed". 
The June 25th decision sounded pretty straight forward except… The City had approved as a budget item, $250,000 to enter into a 50/50 agreement with the County to develop a Salt and Sand facility for joint service in the region. The proposed $500,000 facility would enable both municipalities to use the facility to mix and store the salt and sand used for winter road maintenance. “The funds borrowed would be paid back through an administrative fee charged for the use of the Salt and Sand Facility. The estimated time to pay back the debenture would be 15 years. A borrowing bylaw for the funds required would be brought back to Council for consideration after the project has been tendered and fixed costs ascertained.”
Gillespie provides an explanation to Council
At the October 29th meeting, City Manager Gillespie explained to Council. “The City of Wetaskiwin has been in discussions with County of Wetaskiwin to jointly construct a modern Roadway salt and sand mixing and storage facility. The City ear marked $250,000 of MSI funding for the project in 2009, based on rough construction estimates that were available at the time.”
He continued the explanation. “As design of the facility began in earnest (2012), it was found that construction costs were much higher than originally anticipated. While some of the first steps to move forward with the project were completed, such as site selection and the securing of project funding, tenders had not yet been let for the design or construction of the facility.”
When the original cost estimates for the facility were examined, it was revealed that the project costs would be double the earlier estimated $500,000 and would cost $1,000,000, or twice as much as was originally estimated.  The City’s portion under the new projected cost to fulfill its 50% obligation towards the shared capital project would be $500,000 and not $250,000. The City was facing an unbudgeted shortfall of $250,000.  
If the City backed out of the agreement, it was suggested that the County would likely proceed on its own. The only other option was left available to them is to borrow the additional $250,000 required. The City had spent approximately $16,000 on engineering for the project.
Gillespie continues, “While the City continued to work with County of Wetaskiwin to develop agreements for the facility capital and operational cost sharing, prior to moving on to the design and construction phases, County administration also raised concerns with the proposed joint facility. At the County of Wetaskiwin regular meeting Tuesday, September 18, 2012, County Council decided to proceed with their own facility, independent of the City of Wetaskiwin.”
Acknowledging a $500,000 planning error had been made, and a by-law was passed to address the $250,000 shortfall, Administration searched for other alternatives. The report continues.  “Administration also reviewed the legislation controlling the use of Roadway Salt and concluded that while following “best practices” would require construction of a new facility, or the purchase of salt from a certified facility, our existing facility at Public Works can be operated in compliance with the Federal Department of the Environment Code of Practice for the management of Roadway Salts.”
  Back to square one – approving a bylaw to borrow $250,000 ends up being a bylaw to repeal the borrowing of $250,000. Back to the original facility at Public Works “Minor work to control drainage, and a system to cover the pile during summer months can minimize environmental issues related to the facility at minimal cost. Using the existing facility at Public Works, operational costs will continue to be significantly less costly (about 50% less costly), then either the private sector cost or the new facility cost. Based on this information, it is clear that a new facility can be deferred at least until a major upgrade of the public works facilities is undertaken.” 
The report concluded by advising Council that, “The $250,000 of MSI funding designated for the facility may be re-designated to some other project, such as Mainstreet Phase 2.  A specific recommendation will be brought forward during budget discussions.”
City Council authorized administration to implement alternative measures, such as drainage control and the covering of the City Sand/Salt storage pile as an alternative to construction of a new facility for the mixing storage and management of Road Salt and Sand.
Following which, ‘the Council of the City of Wetaskiwin has deemed it expedient and necessary to repeal Bylaw 1794 – 12. "Debenture Bylaw – Sand Salt Shed’. 
 
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