Adelaid Street Rail underpass project budget skyrockets

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The cost of one of London’s most anticipated megaprojects has risen 50% from initial estimates.

In a report to City Hall’s Civic Works Committee (CWC), the administration explains that following a detailed design and bidding process, the total cost of the project was climbed to $87.6 million, or $29.3 million more than expected.

Council approved the four-lane underpass of the CP tracks between Dundas and Oxford Streets for $58.3 million.

“We’ve had a lot of economic turbulence, especially with construction, supply chain disruptions, labor shortages,” says Doug MacRae, director of roads and transportation.

The procurement process received only three qualified bids, staff recommend the lowest.

To date, $22 million has already been spent on the project, which is preparing to come out of the ground.

Delaying the project to redefine the scope and launch a new bidding process would jeopardize $11.1 million in federal funding that must be used by October 2027.

The city administration recommends closing the budget gap of $29.3 million as follows:

  • $200,000 from London Hydro & Water/Wastewater
  • $11.2 million from City Hall’s life cycle renewal budget
  • $8.4 million from additional debt
  • $9.5 million from development charges

Resurfacing of the Highbury Avenue portion of the freeway will be pushed back three to five years, and road improvements on Southdale Road near Byron will also be delayed.

“We recommend that the council defer them for a few years to create the financial capacity to complete the Adelaide Underpass,” adds MacRae.

The report to the CWC says the massive understatement prompted further scrutiny at City Hall, “The results of this tender prompted the administration to review existing project management processes to improve the reliability of the project. ‘cost estimation and budget alignment’, reads the report.

The shunting of trains back and forth through Adelaide Street has plagued commuters, emergency services, pedestrians and cyclists for decades.

At the time the underpass project was approved, Adelaide was jammed between 11 and 30 times a day, with shutdowns lasting an average of almost four and a half minutes.

The Civic Works Committee will discuss the new underpass price at a March 29 meeting at City Hall.

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