Contractor fires back in bitter dispute over Grande Prairie hospital project

In an increasingly bitter dispute, the contractor building the Grande Prairie Regional Hospital is placingthe blame for construction overruns and delays squarely on the province.

"The (province's) recent release of a notice alleging default is unfortunately rife with errors and misstatements," says a statement issued late Wednesday by Graham Construction.

But Infrastructure Minister Sandra Jansen said it was Graham's statement that struck an "unfortunate tone."

During an afternoon teleconference, Jansen stood by her assertions andultimatum issued Monday, that Graham has until August 22 to come up with a plan to put the much delayed hospital project back on track orrisk losing the contract entirely.

The minister didn't dispute claims by Graham that the projectincurred some 600 change orders since it waswas revised in December2016.

"Many changes required demolition of completed work to accommodate the new scope, affecting project cost and schedule," Graham Construction said in its statement.

But Jansen took issue with Graham's reasoning that frequent change orders contributed to delays and cost overruns.

"Change orders always happen on job sites," said Jansen.

"The scope (of the hospital project), was set in place in December of 2016. we both signed that contract and agreed to it."

• Province issues default notice to Grande Prairie hospital contractor
• New Grande Prairie hospital delayed until 2019

On Monday, Jansen said she was dumbfounded by a recent request from Graham Construction for an additional $120 million to finish the project, a statement the company said is false.

However when asked if Alberta Infrastructure was willing to bend on the $763 milliontotal price tag of the entire hospital project, Jansen was noncommittal.

"I'm not going to negotiate with Graham [Construction]through the media," said Jansen.

Frequently advised of increased costs

Since late 2016, Grahamsays it has repeatedly advised the government that the $510 million budgeted for its portion of the contractwas insufficient for the evolving design, estimating the cost had grown to $583 million, the company's statement said.

Recently, at the province's request, Graham said it provided an updated budget based on the latest design, which included an additional contingency amount of $35 million.

Graham's deteriorating relationship with the province over the project has forced it to invoke the contract's dispute resolution process to resolve a number ofissues.

Graham said since Marchit has sought to meet with the minister and senior officials, but meeting dates have been cancelled and follow-up requests for meetings have gone unanswered.

The company said it remains open to meeting with the government and resolving the issues. But it warns that Alberta Infrastructure must take on its "responsibilities and obligations."

In the meantime, "Graham will vigorously defend its position and reputation," the statement said.

Jansen said Alberta Infrastructure and Graham have had frequent meetings, from the project floorto the executive level.The most recent took place July 20, she said.

The new Grande Prairie Hospital has been in either the planning or construction phase since 2011 and was supposed to be operational by the end of 2018 or early 2019.

Given the delays,Jansen could not offer a firm date for when the hospital will open to patients.