$1.5 million saved by Council

Southland District Council has saved about $1.5 million on estimates for two major roading contracts.

Group Manager Services and Assets Cameron McIntosh said a contract for sign maintenance and a second for reseals have been awarded and the tender prices have come in considerably lower than expected.

“The savings of over $1.5 million on the two contracts is good news for Council. The estimate for reseals was $5,218,500 and the winning tender was $4,462,424, a savings of $756,076. The estimate for this year’s signs maintenance contract was $1.6 million and the winning tender was $885,208, a savings of $714,792,” Mr McIntosh said.

Six tenders were received for the signs maintenance contract, with a $600,000 difference in price from the lowest to the highest. Sealcoat Central Ltd won the tender for the three-year contract.

While Sealcoat is based outside of Southland, it will need to establish staff in Southland to undertake this contract. It has successfully run contracts in the North Island, Mr McIntosh said.

“We are very pleased with the price, but it is important to note that the present contractor, Hawkins Building and Contracting Ltd and its staff, has provided excellent service in the past 11 years and we still have a high level of trust and respect for them,” Mr McIntosh said.

Two tenders were received for the resealing contract for nearly 140km of Southland roads. Blacktop Construction Ltd won the tender. Blacktop is a new contract for Southland District but has successfully undertaken contracts for Gore District Council.

APAC committee chair Cr Lyall Bailey said Council has an obligation to accept the tender with the lowest weighted score, provided the successful contractor demonstrates an ability to carry out the work to Council standards.

“Sometimes this means a local company, which is the incumbent, may miss out, purely because of cost.”

Under NZTA requirements, Council is obligated to seek out the best possible price.