Ontario Construction News staff writer
Construction & Design Alliance of Ontario (CDAO) has asked Premier Doug Ford to reverse a decision to cancel the Halton Courthouse project.
“Recognizing these very difficult times we are together navigating, we feel compelled to provide you with some reflective feedback on the repercussions of the recent decision to cancel the Halton Regional Courthouse Project,” CDAO chair Sandro Perruzza wrote in a letter to the Premier and several cabinet ministers.
“It is important to share with you the breadth and depth of the impacts the termination of this project will have on our sector, the Ontario economy and your administration.”
The project, arguably the largest shovel ready and shovel worthy project of its kind with a construction price tag of over $300 million and a total project cost of approximately $725 million when aggregate payments over the 30 year project agreement are included, was abruptly cancelled by the province last month.
“After years of preparatory work, with the imminent announcement of financial close expected and construction expected to begin shortly thereafter, no one could have foreseen the decision to terminate this project,” Perruzza wrote.
“If the building had to be adapted for a post-COVID world, that would have been understandable. Unfortunately, in this particular case the net benefit of this choice is not clear to us.”
While the explanation of the decision is rooted in the policy of virtual delivery of justice services given the present need for physical space to provide these services, the present state of the existing physical infrastructure this project was meant to support, along with the still evolving present state of Ontario’s virtual justice services infrastructure, it is unclear to us that the termination of this project was the right choice to enable the greatest net benefit; to the provincial justice system or the Ontario economy.
“It is not our intention to debate a decision that has already been taken,” Perruzza wrote. “Rather, we wish to bring to your attention the arguably more significant impact this choice will have on Ontario’s broader construction sector and the economy.”
According to the CDAO, the cancellation “will have profound and immediate consequences” for the provincial and regional economies, including:
- Existing well-paying direct jobs in professional, construction and construction-related services will be jeopardized or lost and anticipated positions will not materialize.
- Broader sector spin-off jobs expected for the regional economy stemming from this project will not materialize.
- The anticipated stimulus from additional future investment in the region and the broader Ontario economy will be hampered because of a lack of market confidence.
- Significant time, effort and money has been spent to assemble land required for this project; land which will now sit idle until another institutional or commercial use can be found.
- The more than three years of effort to complete several phases of environmental studies by technical, architectural, legal, and financial and procurement advisors will go unrealized until a similar project can be developed for this site.
- Millions of dollars of fees to the Ministry of the Attorney General associated with all of this work will have been spent for no return to the taxpayer.
“These observations are not presented as a complaint, rather they are offered as context of how deeply this particular choice, on this particular project, at this particular stage of procurement at this particular time will negatively impact our sector and the provincial economy at a particularly vulnerable time,” Perruzza wrote.
The consequence of cancelling the courthouse and the Hamilton LRT projects “will be an undermining of proponent and investor confidence in the Province’s commitment to its infrastructure program. This presents a very real risk of stifling the flow of market capital into Ontario and of driving existing potential investors from the province.”
Perruzza offered to discuss the cancellation with senior government advisors and “chart our next steps together.”