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Ontario contractors question 'bundling' of Eglinton Crosstown construction work

A coalition of construction, design and engineering firms has raised concerns that the "bundling" of station and maintenance facility construction for Metrolinx's Eglinton Crosstown light-rail transit (LRT) project in Toronto is limiting competition at the expense of taxpayers.

An analysis conducted by the Ontario General Contractors Association (OGCA) on behalf of the Construction Design Alliance of Ontario (CDAO) determined that Ontario and Toronto taxpayers could save up to $500 million (in Canadian dollars) in construction and design costs for the Eglinton Crosstown project by tendering it differently, CDAO officials said in a press release.

"Bundling the station and maintenance facility construction into one contract has hamstrung the tendering process, limited competition, stifled the innovation, and isolated the small- and medium-sized construction design firms," said CDAO Chairman Clive Thurston, who also serves as OGCA's president.

Only two consortiums — one Canada-based and the other led by multi-national firms — have expressed interest in the $4 billion project, he said.

If the project was divided into smaller pieces and stations were tendered individually, up to 10 small- and medium-sized, Ontario-based construction and design firms would have bid on each of the smaller projects, according to the analysis. That process would increase competition and generate taxpayer savings, CDAO officials said.

"More Ontario firms working on individual projects have a direct impact  on the local economy through employment, taxes and investment," Thurston said. "Studies have shown a 'hollowing out' of domestic industries occurs as a result of needless bundling of projects into massive, unmanageable packages."

The Eglinton Crosstown project calls for building a LRT line between Black Creek and Kennedy Station. The line will link 54 local bus routes, three Toronto Transit Commission subway stations and GO Transit services.

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More News from 8/7/2013