Kelowna Community Theatre
Runaway inflation of over eight per cent, along with supply chain issues, are having a detrimental affect on Kelowna’s 10-year capital plan.
The updated plan, which city council will review Monday morning, has seen numerous changes due to outside pressures such as inflation.
Comparing the previous plan to this one, figures show 31 projects have been removed or cancelled while 68 have seen “significant cost increase or decrease greater than $5 million.”
Many of those are cost increases.
Many of the larger increases are included within buildings and parks. The report suggests a cost escalation of about 40 per cent within the buildings sector and 30 per cent in parks.
As a result, an escalation above 30 per cent was applied to all building projects.
“Investment is in preserving major projects which are known council priorities such as KCC and the Glenmore Firehall,” the report states.
“Other projects, typically smaller items have been deferred or dropped to P2 (unfunded) as a result of the cost escalation, such as Rutland Firehall, Rutland Community Police, parks washroom renewals, heritage and capital opportunities.”
Cost escalations of about 30 per cent have also been applied to all parks projects, meaning some have also been dropped or deferred, including seven neighbourhood parks.
Investment in park projects such as Pandosy, Glenmore, DeHart, Kerry, Casorso and City parks will move forward.
“The changes in the plan are primarily due to factors beyond the city’s control,” the report states.
Labour shortages, supply chain challenges, rising interest rates, and increased energy costs. These impacts are coupled with rapid growth and community demand for enhanced services at a time when existing infrastructure requires replacement.
“Despite these challenges, the city continues to deliver world-class infrastructure and services. Many capital projects continue to be completed; delivering on council priorities, meeting the objectives of the Official Community Plan and community expectations.”
The overall 10-year capital plan includes investments of $2.37 billion, of which $1.63 billion have municipal funding through either taxation or reserves, provincial or federal funding tied to them.
The remaining $744 million are unfunded at the present time.