Hansard November 27, 2013

Mr. Silver:   The August deadline for handing over the new waste-water treatment facility to Dawson came and went and the residents still don’t have a functioning plant. Over $30 million has been spent during testing done this summer and the plant failed three out of the four required tests. This has cost more than it should. It has taken longer than promised and still isn’t working properly. The list of concerns on this project remains very long.

Does the minister still have confidence in the facility and when does he anticipate that it will be working properly?

Hon. Mr. Cathers:      This is an area where I remind the member that we were compelled to assist the Town of the City of Dawson after a previous mayor pled guilty to violating the water licence. This is a result of court orders that flowed as a result of this, and we have taken steps in collaboration with the municipality of Dawson City to identify which solution they felt was appropriate for treating sewage.

The plant that was established is the result of that work and we are in a period right now where the contractor for the facility does have an obligation to prove that it can be run successfully before either the Yukon government or the City of Dawson accepts the handover of the facility. There is also a warranty period written into the contract so that within — if memory serves — two years of the date we have taken over the keys, so to speak, if there are issues to be addressed by the contractor, the provisions of the contract are intended to ensure that we are able to enforce them doing just that.

Mr. Silver:   Taxpayers are on the hook for $30 million for a plant that has yet to work properly. It has been operating for more than a year, but this summer, like I said, it failed three out of four of those mandatory tests. The City of Dawson is refusing to take over the operation of the plant until it works properly, and well they should.

 Another concern is the cost to operate the facility itself. The government has made vague comments and commitments to the town saying that the town will not be left on their own to flounder with this thing. Dawson residents already pay a very high price for water and sewer services, and any increases would be difficult for most residents to endure.

What assurances can the minister provide that residents will not be left with higher water bills because of mismanagement on a $30-million plant?

Hon. Mr. Istchenko:           Highways and Public Works, in partnership with Community Services, provides the project management, as we know.

I want to clarify a few things. Corix is the company operating the plant under the conditions set out in the acceptant testing clause of the contract between Highways and Public Works and Corix. Now through this whole process, the contract allows for an extension to the acceptant testing period, which is necessary to prove the plant can comply with the water licence for three months continuously. We are running it until it runs effectively and then we will turn it over to the residents of the City of Dawson.

When it comes to the costs associated, we have met with mayor and council. We’ve talked to them about the cost of it. We’ve talked about the benefits of having a biomass plant — for them having to heat their water so it doesn’t freeze. The City of Dawson is definitely being treated fairly on this and we’re working closely with them. They’re happy to be working with us and I look forward to more engagement with them as they take over this project.

Mr. Silver:   We still don’t have a commitment that we will not be downloaded extravagant costs for operation and maintenance.

I am pleased to hear the minister’s assurances today. I want to be clear, though. Residents should not be left holding the bag in the form of higher bills because of this overbudget project. People in Dawson remember a previous Yukon Party government’s decision to throw out the bid of a local company on this project and go with a company from Outside — the bid of which was $10 million over that of the local company’s bid.

At that time, a representative of the local company said — and I quote: “Dawson, Yukon and Canada taxpayers better pay heed or they’re going to end up with another white elephant.” Five years later and those words are ringing true, Mr. Speaker.

Yesterday we learned WCB has completed an investigation of the facility over problems with mould. Given the missed deadlines, the test failures, WCB investigations and the unresolved issues that the new plant will cost Dawson City, I still ask the question: will Dawson residents have to pay for increases to O&M or to water bills because of this white elephant?

Speaker:       Order please. The member’s time has elapsed.

Hon. Mr. Cathers:      I would remind the member that the plant that was put in place was the result of working with and listening to the City of Dawson. Feedback from the municipality was that they preferred that to an open lagoon, which is, of course, the much more common method of treating sewage.

The mechanical solution was chosen as a result of their input and we are currently in a phase where Corix, the company that has the contract, has an obligation to demonstrate that the facility will operate effectively. Prior to handing over the keys — and, more accurately, the responsibility for the facility — to Dawson or to the Yukon government — and after that transfer of responsibility has taken place — there is still a two-year warranty in place, which is intended to ensure that, if there are any deficiencies in operation, we and the City of Dawson will be able to ensure that the contractor addresses them.

The member taking a failed-bidders’ side of things and phrasing that as accuracy — if the member wishes to delve into every contract and every contractor’s view of why they should have received the contract instead of a competitor, we’re not going to have a very useful debate here. I would again remind the member that the approach that was taken was as a result of what we heard from Dawson City, and we are focused on ensuring that Corix fulfills their obligation —

Speaker:       Order please. The member’s time is up.