The County of Stettler saw the effects of construction industry inflation during their June 8 regular meeting as an asphalt overlay tender appeared to result in prices about 50 per cent higher than a year ago.
Councillors read a report on the resource road asphalt overlay tender presented by Director of Operations Rick Green. “So this is a tough one,” said Green. “Prices are up.”
He explained the bids for the final stage of asphalt lift on the resource road were up about 50 per cent over 2021 prices, but added that the pricing was similar to what the county could have expected about four years ago.
The tender included schedule A and B which included four miles of work.
Offers came in from five contractors, including Lahrmann Construction Inc.of Lacombe ($893,256.80), Central City Asphalt Ltd. of Blackfalds ($969,363.50), Border Paving Ltd. of Red Deer ($922,735.00), Aecon Transportation West Ltd. of Medicine Hat ($996,070.00) and TJ Paving Ltd. of Red Deer ($1,111,482.25).
It was noted this project was included in the county’s 2022 budget and that $850,000 from the federal gas tax refund would be applied, but funds in excess of that would come from either operations or reserves.
Green noted Lahrmann, the low tender in this case, previously worked on the Fenn Road.
Green stated he asked for a contingency for this project to in essence reward quality work with dollars. The three per cent contingency would, stated Green, offer the potential of bonuses for quality work.
During discussion it was noted that $44,000 worth of GST could be recovered meaning the project would go over by $67,000.
Coun. James Nibourg asked who decides what “quality work” is. Green answered the contractor engages in quality assurance on the work site followed by the county also taking samples and sending them to a lab.
It was also noted the warranty period on asphalt overlays of this type is one year.
Councillors unanimously approved by resolution to award the resource road asphalt overlay to Lahrmann Construction of Lacombe.
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