The cost of a new library in downtown Ottawa is ballooning due to inflationary pressures, forcing the city to come up with an additional $ 64 million to cover its share of the common facility, according to a new report.
A report submitted to the Ottawa Public Library Board to be considered at its next meeting Monday shows that the total cost of the new facility has risen to $ 334 million, an increase of $ 141 million from recent estimates.
Baptized Ādisōke at a ceremony with native representatives earlier this year, the new facility to be built on a plot on Albert Street will be shared between the Ottawa Public Library (OPL) and the Library and Archives Canada (LAC).
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While the report says the LAC has covered its share of the inflated costs, the city will have to approve an additional $ 64 million in expenses for a total contribution of $ 168 million to the new library.
The library was previously scheduled for completion at the end of 2024 with an official opening the following year. Now the project plan aims for the end of mid-2026.
The entire project was expected to cost $ 192.9 million when the city council approved it in 2018.
That included about $ 18 million for a 200-seat underground parking garage, which has now seen costs jump to $ 28 million. However, these costs must be reimbursed through parking revenue.
“The difference between the actual cost and the initial estimate can be directly attributed to the escalation in the construction market in Ottawa,” the report reads.
Canada’s construction industry has faced enormous pressure during the COVID-19 pandemic with labor shortages, rising prices for materials such as steel, and delays in the supply chain, increasing the cost of most projects.
Cost of materials that make construction less affordable
The pressure is “worsening” in Ottawa with a number of other high-profile projects underway, such as the renovation of Parliament Hill and Phase 2 of light rail, according to the report.
Ottawa’s initial construction cost estimates had included a price inflation of about 10 percent from the 2016 level.
However, using Statistics Canada’s estimates of construction inflation in Ottawa up to 2023 (the expected midpoint of the project), the report now expects a 65 percent increase in prices at that time.
The staff proposes to cover the city’s share of the deficit through OPL reserves, development fees and municipal tax debt.
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