CentrePort South servicing price tag gets $13-M bump

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This article was published 30/10/2023 (701 days ago), so information in it may no longer be current.

Work to prepare CentrePort South for development is now expected to cost nearly $13 million more than last estimated, though supporters still expect the benefits to greatly outweigh the rising cost.

The City of Winnipeg had previously budgeted $61 million for the project, which will complete the first phase of extending water and sewer service to the northwest area to help attract new development.

However, a finance update now indicates the project won’t be spared from widespread soaring inflation and construction cost hikes.

“The public service is evaluating the impact of current market conditions and will refer an additional $12.7 million to the 2024-27 multi-year budget (to cover the cost hike). Scope and cost will continue to be carefully monitored during the detailed design phase,” Cynthia Wiebe, manager of engineering services for the city’s water and waste department, writes in the report.

In an interview, Wiebe said an earlier estimate dates to 2020 and conditions have greatly changed in the years since.

“(We’ve now) added in the escalation, which is the bulk of (the overrun). Some (higher costs are) just because of construction inflation. Everything’s more expensive.”

The report notes the added costs can be funded through retained earnings from water and sewer rates.

In March, the city and province reached a funding agreement for the project, which will have the Manitoba government pay $40 million and the city pay $21 million, which covers its previous price.

Coun. Jeff Browaty said the project will help attract greatly needed industrial development.

“We’ve done an employment lands strategy analysis and, in the City of Winnipeg proper, the amount of industrial serviced land is very low,” said Browaty, council’s finance committee chairman.

“The cost benefit, I believe, was quite strong to make this investment, in terms of improving our tax roll, in terms of providing jobs to people in Winnipeg and the capital region. It is needed.”

Last year, a city report estimated the full 30-year plan to extend water and sewer service to the land, which was previously referred to as Airport Area West, could generate up to 16,000 full-time jobs once completed. At the time, the entire long-term project was expected to cost $113 million.

The report also predicted the resulting development would create $129 million in annual tax revenue for the federal government, $107 million for the province and $80 million for the city. (The current project would offer just one phase of that work.)

The 3,600 acres of land eyed for the industrial development is bordered by the Rural Municipality of Rosser to the north, James Armstrong Richardson International Airport to the east, Saskatchewan Avenue to the south, and the Perimeter Highway to the west. Industry is expected to cover 2,535 acres, with the rest earmarked for housing.

Meanwhile, the financial update notes the project may require changes after the province identified a “burial mound along the preferred feeder main alignment” in September.

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“Basically, it’s a location that could be of heritage (value). When we do our heritage impact resource assessments, we reach out to the province and they provide us with areas that could be culturally, historically sensitive… We’re in the process of seeing exactly what impact that might have on our infrastructure alignment,” said Wiebe.

She did not have additional details about the “burial mound” itself.

Late Monday afternoon, city spokeswoman Lisa Marquardson referred questions on the issue to the provincial government, whose officials could not immediately be reached for comment.

joyanne.pursaga@freepress.mb.ca

Twitter: @joyanne_pursaga

Joyanne Pursaga
Reporter

Joyanne is city hall reporter for the Winnipeg Free Press. A reporter since 2004, she began covering politics exclusively in 2012, writing on city hall and the Manitoba Legislature for the Winnipeg Sun before joining the Free Press in early 2020. Read more about Joyanne.

Every piece of reporting Joyanne produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press‘s tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.