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2007 February Report of the Auditor General of Canada
Exhibit 7—New airport terminal building project in Old Crow-concerns about cost estimates and building design
The original airport terminal building in Old Crow was constructed in 1978. In 1999, the replacement of the building was identified as a priority. However, the proposed project was shelved twice—in 2001 and 2002—after the design and construction cost estimates were prepared. In June 2003, the design architect noted that since the start of the original project in 1999, the construction estimates had increased by about 60 percent.
On 31 March 2004, the Management Board granted approval to implement the project (including removal of the existing building and other ground works) at a target total cost of $2,046,815, with a completion date of 15 August 2006. The Board also directed the Department of Highways and Public Works to provide information on the foundation design and construction methodology.
In June 2004, the Management Board directed that the construction of the building be tendered with a pile foundation design. In July 2004, the Management Board approved a different foundation design for the building (rather than a pile foundation) and approved a revised target total cost of $2,453,231. The tender closed on 21 September 2004; the lowest bid was $2,469,000, about 20 percent higher than the pre-tender construction estimate of $2,054,149. The Department indicated that delay in tendering resulted in a $200,000 premium for winter work and increased cost for labour and materials. The Department also indicated that the complex building design as requested by the community was not conducive to the use of local labour.
On 29 September 2004, the Management Board approved a revised target total cost of $3,106,990. The Board expressed concerns that the cost estimates were inaccurate and the design did not maximize skills available within the community.
Source: Department of Highways and Public Works