Cost of new buses needs double take, per Whitehorse city staff
On May 5's standing committee meeting, councillors heard that the city's budget will need to be changed to adjust for a nearly $500,000 price increase on an order for five buses.
Originally the budget item was marked down as costing $4,109,924, funded with the federal government's Investing in Canada Infrastructure Program's public transit stream. That initial cost estimate was made in 2024.
However, prices have increased beyond what was expected and those five buses now cost $495,000 more. Aside from the now confirmed cost of the buses being higher, the additional $495,000 includes a contingency of 3.5 per cent to buffer against any impacts from tariffs or supply chain issues.
The $495,000 would come from the Transit Equipment Reserve, a pot of money that can only be used for public transit purposes. That fund clocked in at $4.7 million as December 31, 2023. More recent numbers won't be available until information for the 2024 fiscal year has been finalized, which will happen in the coming months, as per a city spokesperson.
Valerie Braga, the city's director of corporate services, told councillors the fund hasn't been used much in the past because there have previously been easy ways of finding funding for public transit. However, moving forward, it looks like finding that funding will be more difficult, she said.
The city's contract for the buses is with Quebec-based Nova Bus, said Richard Graham, the city's manager for fleet and transportation.
That said, the company has assembly plans on both sides of the U.S.-Canada border.
'We are fairly confident in the pricing, and we are hopeful that we wouldn't need the 3.5 per cent. The wild card is just what may happen globally in terms of additional costs,' said Graham.
'In terms of the costs from Nova Bus as long as we award within the time limits on the pricing, then that price would be fixed for the delivery.'
Two of the buses being ordered are set to replace two buses within the city's fleet. Both of the buses due for replacement are from 2008, with over 1 million kilometres on them each.
The remaining three buses on the order would be additional buses to bolster the city's fleet.
The transfer payment agreement for the new buses is in the final stages but not yet quite solidified — however, Graham said that it would not be long before the agreements are signed.
The buses are currently on appendix B of the budget, which means they're not purchased until there is confirmation of external funding — in this case, the money from the federal government.
'So no purchase order or anything can be written until such point as we get the TPA. But once we do, it moves into Appendix A, and the buses can then be ordered,' said Braga.
The buses are currently scheduled to be delivered to the city sometime in 2026 or 2027.
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