Item - 2019.EC3.7

The Economic and Community Development Committee:

1.  In accordance with Section 71-11.1C of the City of Toronto Municipal Code Chapter 71 (Financial Control By-Law), granted authority to amend Purchase Order No. 6047316 issued to BLT Construction Services Inc., for work and associated costs to accommodate and address unforeseen site conditions that were encountered at each site and to expedite delivery of the three (3) temporary respite facilities, by an additional amount of $3,652,000, net of all applicable taxes and charges ($3,716,275 net of HST recoveries), revising the current Purchase Order value from $7,497,814 to $11,149,814 net of all applicable taxes and charges ($11,346,051 net of HST recoveries).

The purpose of this report is to request authority to amend Purchase Order No. 6047316 issued to BLT Construction Services Inc. for the emergency provision of the design-build of three (3) temporary respite facilities at locations to be selected by the City of Toronto. The total Purchase Order Amendment being requested is for an additional amount of $3,652,000, net of all applicable taxes and charges ($3,716,275 net of HST recoveries), revising the value from $7,497,814 to $11,149,814 net of all applicable taxes and charges ($11,346,051 net of HST recoveries).

An estimated project cost was developed based on client requirements and generic site specifications, as sites had not yet been identified. Given the urgent need to respond to the increasing demand for capacity in the shelter system, a Purchase Order for $7,497,814 (the estimated required value to construct three structures) was entered into with BLT Construction in July 2018 pursuant to Chapter 195 of the Toronto Municipal Code, Section 195-7.4B "Non-competitive or limited solicitation contract authority - emergency," which allows a division head to enter into a contract in relation to a non-competitive procurement of goods or services required in an emergency where the potential value of the non-competitive contract exceeds $500,000 or their delegated spending authority.

As noted above, the Purchase Order was issued before site selection had been finalized. Once sites had been selected and fully evaluated, Facilities Management and contracted staff identified site-specific conditions that required rectification. This was completed at an additional cost ($2.92 million) and left insufficient value on the contract to complete the construction of the modular structures. The requested amendment addresses these additional costs and will enable completion of the structures.

While site work increased the cost of the project, the actual cost of the modular structures themselves was largely consistent with pre-construction estimates. The requested amendment includes an additional $730,000 to accommodate the addition of a mezzanine level and a protective shield to each structure. These features were not included in the initial cost estimate but were determined to be necessary to maximize interior space and prevent damage to the structures' textile membranes. Even with the requested amendment, the modular structures represent good value for money to the City, yielding more respite spaces at a lower cost than construction of a permanent facility.

The first facility at 69 Fraser Avenue opened in December 2018, while 351 Lakeshore Boulevard East and 701 Fleet Street are targeted for completion in April and May 2019, respectively. Without approval of the requested amendment completion of the project is at risk.