Montreal is putting on the table another 32 million in hopes that construction sites on its future composting centers, which have been frozen for eight months, will resume.
Posted at 12:00 p.m
Mayor Valérie Plante’s administration wants to put an end to this saga, forcing them to export the contents of Montrealers’ brown bins, particularly in Ontario. The official opposition regrets that the city is giving in to a company that is shutting down its construction sites.
The executive committee on Friday voted to increase the budgets of the two projects, which already totaled 340 million. “The next step will be to agree to an agreement with Veolia,” the city said in documents given to elected officials. Otherwise, “a lawsuit is to be feared”. The case will be heard by City Council next week.
The EBC contractor had left the construction sites of the future Saint-Laurent and Montreal-East treatment centers in July 2022 because of a trade dispute with the municipal client, the company Veolia.
In return, “Veolia insisted on claiming additional costs from the city, without Veolia providing sufficient justification for those costs or providing supporting documents,” the city states in its filings. The company specifically mentioned the aftermath of the war in Ukraine or inflation to try to inflate the bill. The city responded that the contracts were fixed and the city did not have to take those risks.
“We will not accept being held hostage by a commercial dispute between the company to which we have awarded a contract and its subcontractors,” said Marie-Andrée Mauger, the Plante administration’s elected environmental officer.
The “proud” administration worries the opposition
On Friday, the city of Montreal opened the door to additional payments to Veolia by voting to increase emergency budgets for the two projects by $32 million. However, these must be linked to valid requests.
The “change guidelines that improve the building beyond the requirements of the contract”, the “work related to storm management” and the “change guidelines that improve the process equipment” in particular could be the subject of additional examinations, the municipal document said.
When construction resumes, Veolia has indicated that the Saint-Laurent center can be delivered in spring 2024 and the Montreal East center in early 2025.
“We are on the home stretch to finalize the agreement,” Valérie Plante’s office said in a written statement. We have taken steps to resolve the situation and we are proud to have done so. It was the responsible task to complete the construction. »
Veolia “was able to provide the city with solid justification for the increased costs it must incur in order to deliver a project that meets industry quality standards. The approval of these amounts will allow us to complete the negotiations to ensure a speedy resumption of work, ”continues the statement, which mentions the direct contact between Valérie Plante and Veolia.
The official opposition in City Hall is not so optimistic.
“The city has been held hostage and we’re seeing the effects now,” lamented Mayor of Saint-Laurent Borough Alan DeSousa.
It is clear, clear and concise that in this showdown between the city and Veolia, the winner is Veolia. Montreal taxpayers are the big losers.
Alan DeSousa, Mayor of the Borough of Saint-Laurent
According to Mr. DeSousa, this situation sets a “very dangerous precedent” that could inspire other city suppliers: Shut down your locations and you could face extra payments. “It opens the door for other companies to do the same,” he said.
“We are pleased with the city’s increase in emergency budgets,” said Carrie K. Griffiths, communications manager for Veolia, via email. The discussions continue […] to find a solution acceptable to all parties. »
EBC declined to comment.
110,000 tons of residue to be treated
The organic matter treatment center’s two projects have been in the news for years.
The Saint-Laurent facility on Henri Bourassa Boulevard West was expected to cost the city $175 million, a sum that includes operations for the first five years. The construction site is currently 90% complete. The plant is said to be able to process 50,000 tons of table scraps per year into compost that can be used in agriculture.
The Montréal-Est facility, a biomethanation center, will be built on the site of the former Demix quarry at the intersection of Broadway North Avenue and Highway 40. Construction and operation in the first five years should cost 167 million in Montreal. According to the city, the plant will swallow 60,000 tons of compost per year.
Both projects suffered from significant delays and cost overruns.
The contracts for its construction and operation went in 2019 to Suez, a French company whose North American subsidiary was bought by his compatriot Veolia last year. This explains why the city of Montreal now has to deal with Veolia.
In 2021, the Montreal Auditor General mentioned a “general finding of cost overruns and schedule non-compliance” in the case of organic matter treatment centers (CTMO). “The CTMO construction project did not follow a sufficiently rigorous process that one would expect for a project of such complexity and scope,” she wrote.