The construction of a $104 million recreation complex in Russell took a giant step-forward last week after Council approved the awarding of an $86 million construction contract to begin building the municipality’s highly contentious arena.
Following the prequalification for general contractors held from February 20 to March 19, eight companies qualified to bid on the construction project. On April 17, the companies received the full documentation to submit a price for the construction for the recreation complex.
On June 11, three bids were received where McDonald Brothers Construction Inc.’s submission was reviewed by the consultants and staff and was deemed acceptable at $86,075,000. The total cost of the project is expected to reach $104,309,044.
“I echo the previous mayor’s comments last fall – we’re getting what we need,” said Councillor Lalonde during the June 24 Council meeting. “We’re maybe not getting exactly what we would have liked to have had but, hey, if it means that we’re getting all the kids and adults and seniors into the indoor pool facility who have never seen that before in our Township, and if it means getting a lot more kids on the ice, and adults, and old-timer hockey leagues onto three NHL surfaces but maybe not having enough room for some of the spectators, I can live with that.”
Council also voted to make an exemption to the building permit by-law so that the project could be invoiced for staff time only. After having discussions with the interim building department director, it was agreed that only the project cost recovery would be charged rather than following the fee schedule. The approach aims to reduce the impact on taxpayers, while ensuring that the building department is recovering all its costs.
The third point accepted by Council was to make an exception to the municipal purchasing policy and giving the authority to the Administration to approve change orders that fall within the five per cent construction contingency included in the Financial Plan.
Financing with a loan
The municipality’s plan to finance the construction phase of the project with a construction loan and the REC Complex reserve until 2028, increasing $150,000 annually with a one per cent tax increase each year, and with the DC Reserve of Parks and Recreation currently standing at $5,506,399.
At the end of construction, scheduled for fall 2026, the construction loan will be converted into a term loan which will be discussed in more details in 2026. It will function similarly to a mortgage, allowing the municipality to select the amortization period, the term length, and the interest rate.
Infrastructure Ontario (IO) will finance the construction through a loan during the construction period.
The administration’s recommendation, along with the financial plan update, was presented for information on June 17. Based on questions raised by Council and members of the public, they presented a listing of the questions and answers and made updates to the financial presentation in order to provide clarity on certain items.
“The other thing I’d like to point out […] is at no point do we talk about possible grants or private partnerships. This is something that I want to reiterate that we would like to see us aggressively pursue, now that we award this contract,” said Mayor Mike Tarnowski. “I’d like to go back to something that Counselor Deacon mentioned at the last meeting, we need to create the story behind this. We need to, as a community, show excitement about this to get upper tier governments involved in this project.”
