City to level $1M penalty for LRT delay
Penalty could be just a small portion of city's additional costs
The City of Ottawa will hold back $1 million from the next payment to the LRT contractor because of continued delays, but that could be just a small fraction of the millions the city has spent.
In a memo released late Friday afternoon, city manager Steve Kanellakos said the city would be holding $1 million back from the next payment to the company, which it will receive when the construction is substantially complete. The $1 million is a penalty built into the contract for missing the completion target.
Rideau Transit Group has so far missed two deadlines for the system to be ready: first in May and then on Friday. The system is not expected to open until sometime early in 2019.
Another update on construction progress is set for the city's finance and economic development committee on Nov. 14.
As early as May, before the second delay was announced, the city's treasurer told councillors OC Transpo's budget would be $21.9 million higher, in large part because it had to continue running buses that the LRT was meant to replace.
The city has insisted it will be able to get any additional costs related to delays from the company.
The city is also running bus detours due to the construction and had to postpone planned layoffs for 345 drivers who were supposed to stop working by Dec. 1.