With the construction project for the Fire Station #2 relocation wrapping up the Town Council was asked last week to authorize an additional $254,165 in unanticipated costs to complete the project.

With some reluctance the council approved the request on a 6-0 vote.

Town Manager Grady Miller told the council staff failed to include an “owner’s allowance” in accepting the bid early this year.

“That is on staff and me,” Miller said.

The owner’s allowance would be used to cover and change orders or cost overruns.

Miller said the allowance was not included because staff expected to be able to keep the project at or below the bid cost.

Miller said construction costs are extremely volatile at this time, primarily due to a very tight labor market. Contractors need to pay workers and subcontractors a premium to bring them onto a job.

Engineering consultants who estimate project costs are having a difficult time keeping up, which is resulting in bids higher than anticipated and resulting in cost overruns.

The council also had to deal with a second item related to unanticipated construction costs.

FH Boulevard

The town has been working for some time on a project for paving the shoulders along Fountain Hills Boulevard from Pinto Drive to Cholla Drive, and the project was recently bid through an Arizona Department of Transportation (ADOT) process.

Public Works Director Justin Weldy said when ADOT had the bid opening in August there was just one bidder with a bid of $880,000, substantially higher than an engineer’s estimate of $594,000. There is $551,538 committed to this project in federal aid funding, leaving $364,000 needed from the town.

Weldy said the town can use its HURF funding from the state and move forward, reduce the scope and rebid the project, or do nothing.

However, he added that staff has applied to the Maricopa Association of Governments (MAG) for an allocation of unspent funds from MAG. He said there is $300,000 available, which would cover 70 percent of the cost overrun and leaving the town with 30 percent to cover.

While the MAG funds are not guaranteed, Weldy said they have a positive recommendation to receive the funds and word will come in December.

Council members said they are eager to move on this long-delayed project, citing pedestrian and bicycle safety concerns. Vice Mayor Art Tolis also noted that with the relocation of the fire station to Fountain Hills Boulevard, more emergency traffic can be expected to use the route and there currently are no safe options for motorists to get out of the way of emergency vehicles.

The council voted 6-0 to move forward with the Fountain Hills Boulevard project.