LRT delay costs city $34.4M — and counting
OC Transpo drivers paid $6.6M in premiums to pick up extra shifts
The year-long delay in building Ottawa's light rail system has cost the city $34.4 million so far, according to a new memo from the deputy city treasurer.
That's up substantially from the last estimate, released late last year when it was thought the project would be finished by March. It pegged the cost at $25 million.
The tally will only keep growing. The memo released Thursday afternoon was based on a completion date of June 30. But Rideau Transit Group (RTG), the consortium building the $2.1-billion Confederation Line, will miss that deadline, too.
RTG is now aiming for mid-August, but it's far from certain it will meet even that, its fifth target.
$6.6M paid to drivers
The city was originally supposed to get the keys to the Confederation Line in May 2018. RTG missed that deadline and three subsequent ones.
As a result, OC Transpo has had to keep its buses running longer than expected, extend detours and pay drivers not just overtime, but also premiums to work additional hours. The city is also paying to keep its rail office open longer than anticipated.
In fact, since the last memo on the cost of delays was released, the city had already paid out $6.6 million to drivers in "mitigation" — the incentives given to drivers to take on additional hours.
City hoping to recoup costs from RTG
At the same time, the city is also saving money because of the delays. It's making interest on the $260 million that it eventually will have to pay RTG, and it hasn't had to pay the consortium maintenance costs for the unfinished system.
But when it's all calculated, the city is still out $34.4 million due to the delays.
Mayor Jim Watson and some city officials have maintained that RTG is on the hook for virtually all these costs. The city has said it will deduct the money from its final payment to RTG.
However, there is no guarantee that RTG will agree to pick up the tab, and it's possible the parties could end up in court disputing the costs.