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Infrastructure project on blocks 79-80 coming in well over budget

Paving put off until next year due to wetness

By Mark Reaman

The town of Crested Butte has to make up a shortfall from what was budgeted for the infrastructure installation project on blocks 79 and 80. Work is being done this fall to put in streets, alleys and utilities on the two town blocks, located on the northeast side of town.

The project will eventually result in approximately 61 units of deed-restricted affordable housing but it appears there is a “significant” overrun in the cost of the project as a result of some costs missed in the original project budget.

photo by Lydia Stern
photo by Lydia Stern

 

The original engineer’s estimate came in at just under $500,000 for the work, not including a 15 percent contingency fee. It also did not include some major testing costs. The bid for the actual construction part of the project was $554,587 and awarded to Lacy Construction but that didn’t include testing costs or engineering fees to NKW Engineering. Hence, the major gap between the estimated budget and actual cost to install the infrastructure.

At a 2016 budget work session last week, the town staff said it was trying to reduce the increased cost, given a six-figure overrun from what was budgeted and presented to the council.

Town manager Todd Crossett said this week the addition of the micro-lots to the project added about $5,000 to the original $23,000 engineering estimate. “Other changes included unexpected charges from utility providers and the additional infrastructure that came as a result of the micro-lot change as directed by the council,” he explained.

“On the other side of the ledger, the project saved some costs by requiring less earthwork and some project streamlining,” Crossett said. “The total cost overrun at this time is approximately $34,500 above the original budget, or $14,000 above the town’s budget with the 15 percent contingency built in.”

Crossett said the major contributor to the cost overrun was the construction bid that came in at about $58,000 over the engineers’ estimated budget. “That happens time to time—particularly in an expanding economy. Plus the project scope changed from the council with the micro-lots and we had some pushback from utility providers that also added to the estimated overrun,” he said.

Town planner Michael Yerman said the oversight was costly but testing for things like compaction is very necessary. “The estimate didn’t include geo-tech testing for compaction. We overlooked that. It’s really important to do because of the groundwater situation over there. In fact, it now appears we will hold off on the street paving because the compaction isn’t coming together, given how wet the summer was. We expect we will end up doing that in June but it won’t impact the timeline we have with selling lots.”

“Right now we look about $34,000 over budget but there are some outstanding costs we don’t know about yet,” explained town public works director Rodney Due. “There are some utility costs that look to increase the cost as well but the Gunnison County Electric Association and Time Warner have stepped up to help this affordable housing project. Atmos Energy with the gas and Century Link are still not on board and so that may add some more cost to the project.”

The additional money to pay for the infrastructure project will come from the town’s general fund, which has a healthy reserve.

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