City of Penticton staff say critical upgrades to Ellis 4 Dam have increased by $7.5M

Costs for a dam upgrade in the City of Penticton has increased by $7.5 million.

The city says the increased cost to upgrade the Ellis 4 Dam is due to unexpected construction costs but the upgrades are critical and must be done because the dam does not currently meet provincial safety regulations.

Next week city staff will be asking council to approve the increase, which will result in a total budget of $18 million.

According to the city, staff will be proposing to fund $11 million through external debt financing, comprising the original $3.4 million from capital reserves in addition to the cost escalation which is a better long term funding strategy.

Staff are recommending a loan due to cost pressures on capital reserves.

Kristen Dixon, the general manager of infrastructure, says the nearly 100-year-old dam is a critical piece of infrastructure that provides both flood protection and irrigation demands.

“If a major storm occurred, the spillway may not be able to handle the incoming flow and the dam would overflow,” Dixon said.

“It’s critical we complete this work to ensure the resiliency and capacity of the structure.”

Dixon added that the project is extremely complex and the winter working condition and a limited construction window have resulted in “significantly” higher costs.

She said that navigating the Ministry approval process and corresponding consulting needs has also presented challenges.

The project was originally estimated to cost $10.5 million, of which $7.1 million is benign provided by the federal and provincial governments.

Dixon said requests for further funding were unsuccessful.