Cost of new Halifax Water building in Burnside surges to $89M

Months before shovels hit the ground, the estimated cost of a proposed Halifax Water operations centre in Burnside has surged to over $89 million — a $37-million jump since February.

Halifax Water applied to the Nova Scotia Utility and Review Board last week for approval to spend $86 million to build a new 9,200-square-metre facility on Jennett Avenue.

The cost will be embedded in future rates paid by customers.

Sitting on a 5.6-hectare site, the building will consolidate four existing depots and bring together 150 staff when it opens in July 2026. Construction is scheduled to start mid-2024.

"This proposed operations facility will help Halifax Water address growth challenges and serve our water, wastewater, and stormwater customers more effectively," spokesperson Jeff Myrick said in a statement to CBC News Tuesday.

"By consolidating staff, equipment, and services into one location, the Burnside Operations Centre will provide greater efficiency. Currently, staff are in four separate locations (Mann Street, Neptune Crescent, Park Avenue, and Bissett Road); three are nearing the end of their useful life and must be replaced."

71% increase since February

The cost increase is 71 per cent higher than the $52-million estimate provided when regulators approved spending $2.75 million for what was called a phase-one design validation in February.

Halifax Water says the increase is the result of several factors including "considerably higher" construction costs, new code requirements and a bigger building footprint.

"The building and yard design has been optimised through the design validation process. Any increase in building size since February 2023, can be attributed to the addition of functions consistent with Halifax Water's business plan or due to building code requirements," the utility said in its application.

Halifax Water says it will borrow the money, which will be included in capital budgets over the next three years. These costs would be incorporated long-term into future rates. The impact is not known. The Utility and Review Board must approve spending.

In its Nov. 3 application, Halifax Water had a warning for the review board.

"There are inherent risks associated with the schedule should the funding approval be delayed beyond April 2024," it said.