Darrell Matson says the $36 million cost estimate to repair the flood-damaged Water Pollution Control Plant is slightly higher than first thought.
The final cost, which includes $21 million yet to be spent to fix the Atlantic Avenue facility, was revealed on Wednesday, the largest chunk of the city’s $43.9-million estimate it will take to fix all the damage from the May 28, 2012 disaster.
Matson said he believes all but $1.3 million of the total cost will be covered through either insurance or the Ontario Disaster Relief Assistance Program. The city carries a $1 million deductible. A further $302,073 was deemed ineligible for reimbursement under provincial guidelines.
The report is expected to be presented to council for information only on Monday night.
“Of that $36 million, $15 million has been spent to date. About $4.2 million of that $15 million was spent just as a result of May 28. So that was the equipment that was removed, the pumps that were removed, the belts, the pumping out of the plants and the lights,” Matson said.
“Based upon that, we will be spending another $21 million that will take us to the spring of 2015 in terms of the total rebuild of the flood-damaged components.”
Matson said city officials believe the entire cost of the plant repair, minus the million-dollar deductible, will be covered by the corporation’s insurance company, OMEX.
There’s not a cap on the payout, as far as Matson is aware about, he added.
“We do have a steering committee where we communicate with our insurers on a regular basis. We have not been alerted to the fact there would be any significant difficulties,” Matson said. “I can’t comment on whether there’s a cap at this particular time. It’s a question I certainly haven’t asked, but it’s being managed a cross-functional team within the city of Thunder Bay.”
Crews working on the plant located more damage as they repair work began, Matson said, explaining why the cost estimate rose. As insulation surrounding the pipes was pulled back, for instance, mould was discovered.
The plant will continue to operate as designed until the repairs are completed, and has done so since temporary repairs were made last year following the flood.
“We do have operational protocols in place for equipment malfunctions which is not predictable. We have staff at the plant 24 hours a day with operations. We do know that there are areas of the plant that could be prone to breakdowns, mostly in the area of electrical controls,” Matson said.
“When we see there is a malfunction, then we have a staff member or a skilled tradesman who will respond to the call.
All the plant’s components are running at present time, he added.
Matson did say upgrades to the plant, proposed to city council earlier this year, are not included in the $36 million estimate.
They will be over-and-above that cost, Matson said, and include an already completed short-term screen channel and the under-design temporary overhead channel bypass.
City manager Tim Commisso said the municipality won't have to empty its coffers to pay for the damage.
"While an extraordinary one-time cost to the city, we are also advising council in the report that between our city insurance coverage, provincial disaster relief Funding and existing city reserve funds, the impact on the taxpayer has been minimized."
The remainder of the $43.9 million has been spent to cover the cost of repairing erosion damage at the John Street Landfill, trails and roads damaged by last May's storm.
