Mike Yardley: Who would pay for a Town Hall repair blowout?

The city council has opted to repair the quake-damaged Christchurch Town Hall for $127.5m.
DEAN KOZANIC/FAIRFAX NZ

The city council has opted to repair the quake-damaged Christchurch Town Hall for $127.5m.

OPINION: With Hawkins confirmed as the appointed contractor for the polarising Christchurch Town Hall restoration last week, can this guts-and-glory project stick within the $127.5 million budget?  

Ratepayers will chip in $59m, with the balance coming from insurance proceeds. As you may recall, the presentation by Christchurch City Council staff earlier this month sharply swayed my views on the merits of embarking on a repair mission. I continue to be peppered with correspondence from disapproving sceptics, who reckon I've been conned about the project's feasibility. Even Earthquake Recovery Minister Gerry Brownlee contacted me claiming he'd heard the building was on a 450-millimetre lean.

So, I set about extracting some written reassurances. Hawkins South Island manager, Steve Taw, asserted the company's passionate commitment to the project, but declined to address any specific questions.

"They are not for us to answer. We are merely the contractor."

Fair enough. The city council's anchor projects manager, Liam Nolan, was swiftly forthcoming:

"Risk management, value for money and cost certainty have been a strong focus of the project."

Berkeley University and Tonkin & Taylor's geotechnical investigations formed the basis of Holmes Consulting Group's quake-resistant foundation slab and structure design, he said.

"The foundation and geotechnical design have been fully and robustly peer reviewed by Beca, supported by Rutherford and Chekyne from USA."

Is Hawkins legally bound to deliver the project for no more than $127.5m?

"Hawkins' contract sum is considerably less than $127.5m, which includes completing the works as per the documentation, including cost escalation."

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Nolan also confirmed much of the risk of unforeseen geotechnical surprises had been transferred to Hawkins.

"Therefore we do not expect the council to pay any more. Notwithstanding that, we have a significant contingency allowance within the overall budget to cover any remaining risk to the council."

If Hawkins was to walk away from the project on the basis of cost-prohibitive surprises, what would happen?

"The contract includes a bank guaranteed performance bond, which means that if Hawkins abandons the project or fails to complete it, they forfeit their bond."

And what about that claimed 450mm lean? Nolan concedes the river end of the Limes/Boater complex has dropped, requiring re-levelling, as outlined in the contract.

I'd hoped the Town Hall spend up would impel councillors to be more aggressive in divesting assets and more disciplined in slashing discretionary expenditure, to blunt the rates track. Regrettably, the requisite political courage was grievously lacking from our divided council. Instead we're stiffed with an eight per cent annual hike, while big-spender Vicki Buck leaps on Facebook to gleefully trumpet a ratepayer spend up on electric vehicles.

 - Stuff

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