Ottawa’s finance and economic development committee agreed to cover its share of the inflated costs tied to the new central library facility at its meeting Tuesday morning, with a groundbreaking now expected in the weeks ahead.
Councillors first learned last week that the costs related to the new joint facility with Library and Archives Canada had jumped significantly due to soaring construction industry costs tied to the COVID-19 pandemic.
Initially pegged at a cost of $192.9 million, the grand total for the project will now come in around $334 million, per the lowest-cost bid from PCL Construction.
Ottawa’s share of the cost will now be $168 million, or $64 million more than initially budgeted in 2018 when the project was first approved.
The finance committee approved the extra spending with a unanimous vote Tuesday morning. The price hike still needs sign-off from the Ottawa Public Library Board at its meeting later in the day on Tuesday and at city council’s next meeting on Oct. 27.
The library board itself would cover roughly $12 million in additional costs in development charge debt and an extra $16 million from its reserves, which are sitting relatively flush after two years of surpluses, the committee heard Tuesday.
There would be roughly $3 million left in the library reserves after the withdrawal, according to the city’s chief financial officer Wendy Stephanson.
The city would cover the rest of the funding through taking on additional debt.
Stephanson told the finance committee the city is able to get preferential rates on the debt by extending its term to 40 years from the originally planned 20 years.
Much of the new debt will replace debt currently on the city’s books that’s set to mature in the coming years, she added.
An extra $10 million needed for a 200-spot underground parking garage will also be covered off by debt but would be paid back by parking fee revenues from the facility.
Staff also managed to find some savings in the project itself largely by downsizing some of the planned spaces and swapping materials where possible, but councillors were promised that the design the public has been shown is largely the same as the planned end product.
Ottawa’s new library also “compares favourably” on a cost per square foot basis with other central libraries in Canada, Stephanson said.
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Choosing not to go ahead with the new library at this stage would mean a series of financial complications and spurned partners in the project.
For one, PCL’s low-cost bid would expire on Nov. 8, so delaying past that point would mean starting the procurement process over again and, in all likelihood, paying more for the final product as bids are revised based on ongoing inflation.
Substantial delays would also be an issue for the current central branch location on Metcalfe Street. Ottawa sold that building and is leasing the space from the new owner, but that deal is set to expire in 2026 — the same year the new library facility is now expected to open.
Ottawa’s planning general manager Stephen Willis said Tuesday that the city does have a clause in its agreement to extend that term should the new library face further delays, but the rental rates would be higher than what the city is paying now.
The city has also signed agreements with LAC to develop their new shared home together; terminating that partnership would put the city in murky legal waters, staff said.
Canada’s chief archivist Leslie Weir told the committee that LAC’s current home on Wellington Street is slated to be taken over by other government stakeholders in the years to come, so any further complications to this project would leave the library in the lurch.
“It would be quite devastating for us,” she said.
Pumping the brakes on the new library could also hurt the city’s relationship with the First Nations of Kitigan Zibi and Pikwakanagan, who have partnered with the planning team to shape the design and other elements of the library from early in the process.
Ādisōke, the name for the library, borrows the Anishinābemowin word for “storytelling” and was unveiled at a ceremony with First Nations partners earlier this year.
Speaking to the finance committee Tuesday morning, Kitigan Zibi director of education Anita Tenasco held up the new library as “an opportunity for us to work on reconciliation.”
“This is an opportunity for us to collaborate in such a strong, meaningful way. We certainly hope that the funding will be found for this facility,” she said.
Should the funding plans be confirmed by the library board and city council in the week ahead, the contract is expected to be awarded to PCL by Nov. 8. A groundbreaking would happen at the site before the end of the fall.
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