New schools face funding shortfall

Soaring construction costs since 2020 mean projects don’t have enough money to get built

KITCHENER A rapid increase in the cost of construction means the region’s public school board will have to go back to the provincial well to ask for more funding to build its new schools.

A consultant’s report on the new public elementary school in south Kitchener — approved by the Waterloo Region District School Board in 2019, followed by ministry approval in March 2020 — now estimates it will cost more than $22 million to complete the project, about $9.4 million more than the funding approved by the province.

The new cost is about 65 per cent higher than the original funding allocated for the project by the Ministry of Education three years ago.

Unless the project receives more funding, construction will not be able to proceed.

Speaking at the public board meeting on Monday, capital projects manager Ron Dallan sounded the alarm on the impact of higher construction costs on the board’s ability to move forward with its major school projects.

“I’ve been here now since 2009, built 14 elementary schools, and we have never had to go back to the ministry from benchmark funding to ask for money before we could go to tender,” he said. “So, we are in unusual times.”

The cost of construction in Ontario has skyrocketed during the COVID-19 pandemic, causing the cost estimates of school construction projects to dramatically exceed the original funding approved by the province.

Dallan mainly attributes this to global commodity price increases for fuel and construction materials.

There’s been an increase in everything from “steel, asphalt, concrete and windows,” he said, and every school board in the province is facing similar challenges.

The board has three other capital projects that will cost over $2.5 million, and all three could potentially overshoot funding approvals as well.

This includes new schools at Breslau-Hopewell Crossing (which has $16.6 million in approved funding) and southeast Cambridge ($13.5 million), as well as an addition at Laurelwood Public School in Waterloo ($3.9 million).

Each of the projects is at a different stage, and could face similar challenges as the south Kitchener project.

“Because the pressure provincially is that everyone is seeing this escalation, there is still a really good chance that we will get some funding here, because they have to rally around Ontario,” said Dallan. “It’s not just our board, it’s 72 boards.”

The question now is how long it takes for the ministry to approve new funding.

While prices appear to be stabilizing in Canada, there is no certainty that construction prices won’t continue to increase over the coming years.

The longer the delay, the more expensive the projects could become.

The public board has already sent a letter to the ministry urging it to