How will the City protect itself against potential cost overruns?
The City will be pursuing a “fixed price” contract for the OLRT project. A fixed price contract means that cost overruns will be borne by the constructor. The full responsibility for construction, design and integration will rest with the constructors. The costs related to any unexpected changes coming from these elements will be borne in full by the constructor, not passed on to the City.
The City will retain a few risks that it is best positioned to manage, including the risk of changes throughout construction, archaeological risk, etc. Provision has been made for the retained City risks in the $2.1 billion cost estimate.
