Delta loses district contract

Delta Utility Services in Alexandra has lost its water services maintenance contract with the Central Otago District Council to Fulton Hogan.

The district council announced yesterday it had awarded the contract to construction company Fulton Hogan for $1.2 million after it was selected from four shortlisted tenders.

Delta chief executive Grady Cameron said "we are naturally disappointed that we will not continue as the 3 Waters service provider to the Central Otago District Council as we have done proudly over the past eight years".

"At this early stage we are still working through the implications of that decision for our 3 Waters team in Alexandra," Mr Cameron said.

Last June seven Queenstown and Central Otago Delta employees lost their jobs during a company restructure because of the economic downturn and less spending by local government.

Council infrastructure services manager Jon Kingsford said Fulton Hogan provided a "very professional tender", in which they offered "an enhanced asset management focus, relationship contracting and increased local resources with a strong customer focus".

The contract came with a reduced cost, presenting the council with an opportunity to tackle several projects that had previously been deferred, Mr Kingsford said.

The accepted tender was within the council's budgets and a submission will be made to its draft annual plan to adjust the water budgets for 2013-14 to the new rate, with an overall reduction to the draft estimates of $210,000 of ratepayer funding.

"Our water services team will be working closely with Fulton Hogan to identify opportunities to reduce service request numbers though proactive maintenance now possible as a result of these savings.

"Fulton Hogan has presented the council with the opportunity to take 3 Waters operations and maintenance to the next level. That has been welcomed with arms wide open," Mr Kingsford said.

Council water services manager Russell Bond declined to comment on how much the contract with Delta had been.

Delta, which is owned by the Dunedin City Council, took over the contract in 2003 after it took over the company Roadex Contracting.

The Fulton Hogan contract was for an initial period of five years and will begin on October 1.

The contract could be extended for a further two two-year periods, subject to contract performance.

The Southland Times