Another milestone was reached on the City Rail Link (CRL) yesterday with the government and the council signing their first official agreement to work together and jointly fund the project. The Heads of Agreement (HoA) sets out how the two parties will work together to come up with a more detailed ‘sponsors’ agreement which is likely to be signed off next year. It also gives some broad details on how the council and government will fund and oversee the project. One good thing is that Auckland Transport now seem to be filming events like this so you can watch the announcement below
The good news on funding is that the government has agreed to pay for 50% of the cost of the CRL including the work already underway – although given Auckland contributes an estimated 36% to the economy it actually means Auckland picks up about 68% of the overall cost. There is a small caveat that the crown doesn’t have to fund any financing costs including interest that are incurred before July this year but I suspect that’s not going to be major in the grand scheme of things. Although it does sound like it means that cost of the hundreds million+ of property purchases for the project will be fully borne by Auckland rather than shared by both parties.
The outcome is far better than some feared which would have seen the government only pay for 50% of the remaining costs after the early works or as indicated in January, they might allow the project to proceed but only provide funding from 2020 onwards. Much was made in the media yesterday about the cost of the project with most reporting it had blown out to $3.4 billion but as is often the case in these situations it is a bit alarmist. The government has stated they think it will cost somewhere in the range of $2.8-3.4 billion and reflects more detailed design work that has taken place. Len Brown’s comments were to remind that the project cost of $2.5 billion was always +/-20%. The cost the government and council will ultimately target to pay is something that will be worked out as part of the more detailed sponsors agreement. Of course a lot will depend on how the tender contracts go.
Below is the project scope showing what is expected from the project – being the CRL and stations in the city plus a few other small upgrades elsewhere on the network.
To oversee the project, they will separate out the CRL team from Auckland Transport and form a company called City Rail Link Ltd (CRLL) which will manage and deliver the project. The HoA states the government will have a 51% shareholding in the company vs 49% for the council and is very clear to point out that it won’t be a council controlled organisation. That makes me wonder if there was some legal or governance reason for the shareholding split.
The structure also means that both parties will benefit from ‘opportunities arising from the project’. As we know both the Wellesley St and Mercury Lane entrances have been designed for buildings to be built above the station entrances so those are likely to be some of the currently unbudgeted opportunities.
The signing of the agreement took place on on Victoria St where a 18m deep hole is being dug so a small tunneling machine can be launched as part of the task of moving the services. The hole is currently 13m deep so still has a little way to go. The photo below is from EmergingAuckland and there are more in the galleries – plus of many other projects.
While on the topic of the CRL, I came across this image from Auckland Transport showing the layout of Karangahape Rd Station
And in another piece of CRL news, Auckland Transport announced yesterday that the Albert St tunnels contract had won a sustainability award
The City Rail Link (CRL) has been awarded a ‘Leading’ Infrastructure Sustainability (IS) Design rating by the Infrastructure Sustainability Council of Australia (ISCA), the highest possible achievement in the IS scheme.
The rating to Auckland Transport is for the design and construction planning (with Connectus) of Contract 2 – Albert Street tunnels and a stormwater diversion.
To award a rating, ISCA considers project performance across six themes: Management & Governance; Using Resources; Emissions, Pollution & Waste; Ecology; People & Place; and Innovation. The process the CRL has undertaken to engage and partner with Mana Whenua to embed cultural values into an industry recognised sustainability framework has been acknowledged as a ‘world first’ innovation.