City needs $9.5M to finish St. Lawrence Market building

The City of Toronto is poised to drop $9.5 million in emergency spending to keep construction of the St. Lawrence Market north building on track — and a serious internal management issue is partly to blame, a document obtained by CBC Toronto shows.

Mayor Olivia Chow said Friday the situation will be looked into and details about what's happened will be made public. "Every dime that we spend needs to be accountable," she said when CBC asked about the situation.

Her council will be asked in late July to approve the additional spending so the facility can begin opening to the public this fall and city staff can move into the brand new glass and orange metal building, complete with a green roof. 

The spending is also needed to stop the contractor, the joint venture Buttcon-Limited/The Atlas Corporation (BA-JV), from exercising its right to terminate the deal and delay the project indefinitely.

That delay, the document warns, would cost the city millions.

"An Emergency [non-competitive procurement] is the only course of action available that would allow the City to meet its immediate legislated payment obligations, while mitigating the threat of a stoppage in work and legal action from BA-JV," the document from June 10 states. 

Cost overruns on government construction projects won't surprise Torontonians, but this time CBC Toronto is able to show a clearer picture of the internal problems, caused by an unnamed former employee, than staff are disclosing to the public.

A public-facing document says the need for emergency funding is "primarily driven" by costs associated with the COVID-19 pandemic, evolving needs for its court services division and "errors and omissions" from the prime architect.

In an email statement, the city said the money is needed to get the project done on time. "A number of changes to the General Contractor's scope of services were accelerated on an emergency basis," it said.

"All changes were validated by the project's Contract Administrator and were determined to be legitimate and required to support evolving building needs."

However, the internal document and recent comments from the executive director of the city's real estate division, paint a different picture.

The document shows a city staffer working on the project was not following "proper change management processes."

Change orders are costs that arise during a construction project that are above and beyond what was initially contracted.

The staffer's error has left management and the city's legal team scrambling to keep the contractor on the job, the document shows.