No delay to St. Albert schools, says minister
But might rethink P3 after just one bidder
By: Kevin Ma
| Posted: Wednesday, Oct 30, 2013 06:00 am
St. Albert’s new schools will be ready by 2016, says the province’s infrastructure minister, although it might not be a P3 that builds them.
A Calgary Herald story published Sunday revealed that just one consortium – Calgary’s Gracorp Capital and Graham Construction – had responded to the government’s call for submissions to design, build and maintain 19 new schools in Alberta as part of a public-private partnership (P3).
Alberta Infrastructure had reportedly told some school boards that this could lead to delays in construction.
St. Albert’s new public elementary and francophone junior-high schools were amongst this group of 19 schools.
But St. Albert MLA Stephen Khan said that the St. Albert schools were still on course to open by 2016, adding that infrastructure minister Wayne Drysdale had personally reassured him of such on Monday. “There’s not going to be any foreseen delays in the building of the schools for 2016.”
The province proposed earlier this year to build 19 new schools through a P3 arrangement.
The arrangement acts like a mortgage or rent-to-own contract: instead of paying for the schools up front, the province gets a group of bankers and builders to front about half of the cost and pays them back over about 30 years. That group also builds and maintains the schools during that time.
The province has built about 67 schools since 2008 through P3s, reports Alberta Education. Alberta’s auditor general found that the province saved about $98 million on the first 18 through this process.
Past P3s have had multiple groups bid on them, said Paul Verhesen, president of Edmonton’s Clark Builders (which built schools as part of a P3 in 2011), which meant that the province could make comparisons and get the best price. If there’s just one bidder, that doesn’t happen.
Verhesen said his company didn’t bid on this round of schools because it didn’t have the manpower. “It’s too big. There’s 19 schools and we only have so many people.” He suspected many other contractors were in the same boat. “I think everybody is busy.”
In a media scrum at the legislature Monday, Drysdale confirmed that the province had gotten just one bid on its P3 for the 19 schools. “We’re reviewing our options right now, but I’m quite confident that the 19 schools will be delivered before Sept. 2016.”
P3s saved the province money, he said, but that means less profit for builders, which could explain the lack of interest. “Alberta’s a busy place in the construction world,” he said, and companies will go where they can make the most money.
Drysdale said he still hoped to do these schools through a P3, but that wasn’t the only option available. “We may look at doing it differently.”
The province could build the schools on its own if it could do it for less than this sole bidder, Khan said as an example.
Or it could split the contract into smaller chunks, Varghese said – the one his company worked on was for 12 schools. “If it were a smaller package, absolutely, we would be interested.”
St. Albert Public School board superintendent Barry Wowk said the province hadn’t told him much about the P3 situation. “We know precious little other than the fact that we need a new school.”
Still, as of Monday morning, provincial officials were telling him that Lois E. Hole Elementary was a go for 2016. “They’re just exploring other options.”
Henri Lemire, superintendant of the Conseil scholaire Centre-Nord (which includes St. Albert’s new francophone school), said he was confident that the province would get these new schools done on time.
“The commitment is just so great on the part of the province to get these schools done,” he said. “If (the P3) doesn’t work, they’ll find another way.”