Infrastructure outlook

Ouellette holds keys to $18.3 billion multi-year spending plan

The next time you see an orange barrel on one of the province's highways, think of Luke Ouellette, Alberta's minister of Infrastructure and Transportation. In a wide-ranging interview with Alberta Construction Magazine, Ouellette says it's not unusual for him to hear from citizens asking when the road construction will end. Ironically, he says, it used to be that he would be asked when a particular road would be fixed.

Ouellette, who just finished his first year as Infrastructure and Transportation minister, talks about what's ahead for the province and construction spending as Alberta grapples with addressing growth pressures.

WHAT DO YOU SEE AS THE BIGGEST INFRASTRUCTURE CHALLENGES FOR ALBERTA?

I think if we're going back to when I first became Infrastructure minister until now, one of the biggest challenges was [dealing with] the red-hot economy, and the capacity, and the prices. We've had quite high escalation costs over the past three years. With that, we've admittedly said that we've really worked on looking after a deficit; some of our infrastructure slid a little bit. So we've really been strong on catch-up mode. With that comes the problem of capacity. With the amount of investment in Alberta, there've been huge construction projects everywhere, and it really doesn't matter what part of the province you go to.

You know what's been funny lately? I've always had the complaints of, "Gee, we've got to get this road fixed, that road fixed." Now people say, "Man, when are you going to get this construction off these highways? Everywhere I go I'm slowed down for construction."

We have a huge amount of construction going on. At the same time, I feel that we are still a little behind and there's a lot more I'd like to get done. But we're getting as much as we can get done within our budgets and within the capacity that's available out there. I think we have a great industry. They've stepped up to the plate. We, in turn, have had to show them that we built up our budget-it's not just this year that we have a bunch of money and that we'll be really busy and then next year it will all stop.

WHY IS THAT IMPORTANT?

They [construction companies] had said, "You know the way governments work, you've a big budget this year [but] maybe nothing next year. Now you're asking us to go out and put another big investment into equipment to handle this capacity, but are you going to be there?" It looks to me like they're gearing up to handle the work that we have.

HOW BIG OF A BUDGET ARE WE TALKING ABOUT?

Our full capital plan is $18.3 billion over the next three years. I think that's unheard of in any other jurisdiction-on a per capita basis especially. In that, it's about $5.4 billion for rehabilitation of roads and getting our road infrastructure up to snuff. That's a lot of money. That's as much as our capital plan was five years ago.

WHAT'S BEEN YOUR GREATEST CHALLENGE IN THE JOB?

I guess my biggest challenge is always trying to make sure the bureaucrats and you are on the same page, that you understand each other on what you want to get done. My challenge from the day I got here has been to find better ways of doing business in order to try and hold our costs to a reasonable increase. That challenge will never go away, because we will always be trying to figure out ways to do things better, and to make sure that we get full value for the taxpayers' dollars, because that's what we're dealing with.

THAT LEADS TO A QUESTION I HAVE ABOUT P3S (public-private partrnerships). THEY SEEM TO HAVE WORKED WELL IN ALBERTA. WOULD YOU AGREE?

It looks like at this point in time the P3s that we have signed contracts on have really, really come through the way we expected. I'm a very big fan of P3s right now. In saying that, though, we will always make sure that we test that contract before we let the RFP [request for proposals] out, and always make sure we do a market comparison and make sure it is the better deal.

I think with as busy as it's been and with cost escalations, that's also really made P3s look good. With the troubles we've had making sure the maintenance gets done, this way we have a 30-year contract where they're [a private company] responsible for that maintenance. We get it as if it's brand-new at the end of that 30 years.

THERE HAVE BEEN SEVERAL STORIES IN THE NEWSPAPERS LATELY ABOUT THE NEED FOR A HIGH-SPEED TRAIN BETWEEN EDMONTON AND CALGARY. DO YOU HAVE AN OPINION ON THAT?

I have lots of opinions. We're still waiting on a ridership study. What that study's all about is this: if we found someone to build it or if we found budget to build it ourselves, would enough people ride it to even carry the operations of it. I'm under the feeling that if no private enterprise would want to partner it, or invest in it, or whatever, should we be spending taxpayers' money on it?

DOESN'T IT HAVE A HUGE PRICE TAG?

If it pays for itself it doesn't matter what the price tag is. If everyone in private enterprise says, "It's impossible. We can't get any type of return on our dollar-in fact, we can't even break even." Then should the government be doing it? That's the big question.

If we would have private enterprise step up and say, "I think we can make a go of this. Can you help us in securing a right of way, or do you have a right of way that we can share or use?" I would gladly sit down and negotiate something.

So the high-speed rail is not off the table. But it has to make sense before we put government dollars into it.

WHAT INTIATIVES DO YOU HAVE UNDERWAY?

One that I believe will come to fruition is our small airport strategy [a long-term strategy that takes a pragmatic look at the capital needs of community airports, such as runway repairs, building upgrades, and other infrastructure such as landing lights and equipment and weighs how the provincial government may be able to assist]. Economically, it's great for all regions in the province because I think if they're innovative with their airport, it draws other things to their area. We've been consulting a lot over the last six months on our Small Airport Sustainability Strategy. We pretty much have that complete. I haven't taken it through Treasury Board and Cabinet yet, but I'm planning on doing that.

Another big thing is our traffic safety plan. We're going to be putting some legislation in this session. We've got some more legislation coming. It's a necessary thing if it's going to help create safety. There are 330,000 more cars on the road today than five years ago.

IF YOU COULD LEAVE ALBERTA'S CONSTRUCTION INDUSTRY WITH ONE MESSAGE, WHAT WOULD IT BE?

We're here to work with them. I want them to be very, very successful. If they are, we will get our job done the way it should be.


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