$20m blow-out in Launceston levee costs

THE cost of Launceston's flood levee project has blown out by more than $20 million. The Launceston City Council is now in urgent talks with both the State and Federal governments, hoping to secure funding to cover the $20 million shortfall. Council general manager Frank Dixon last night revealed the estimated costings on the project had ballooned from $39 million to more than $59 million, mainly due to the price of land acquisitions in Lindsay St and skyrocketing construction costs. The council has also budgeted $1 million for emergency management. "We have got a challenge and we need to get the additional funding," Mr Dixon said. "What we are saying is that we need to have State and Federal governments fund that shortfall. "We have enough funding to do what we need to do in the next 12 months. "While we need a commitment of additional funding, we don't need funds advanced from the State or Federal governments in the next year - but we will certainly need it immediately after that." The council embarked on the flood levee project in 2007 after an independent report found Invermay and Inveresk would be inundated in a major flood, displacing thousands of people and causing more than $110 million damage. The obsolete levees, built in the 1960s, would be rebuilt under the plan to a one-in-200-year flood standard with the council, State and Federal governments each pledging $13 million towards the project. The council compulsorily acquired 18 properties on the southern side of Invermay's Lindsay Street last year to make way for the project. Negotiations with some landowners on compensation costs for their land are ongoing. Mr Dixon said original valuations done on the land in Lindsay Street had proven inaccurate, and this had been the biggest contributor to the levee project's $20 million shortfall. "On the basis of all the advice from independent valuers which we got originally, it gave us the conclusion of $16 million (for the land in Lindsay Street) and we were very confident at the time that would be what the cost would be," Mr Dixon said. "But as we've been going through the confidential land acquisition process, the independently assessed and Valuer-General approved valuations for acquisition have certainly been much more significant than that and have been revised to $28 million." The estimated costs of construction on the project had risen from $22 million to an estimated $30 million, Mr Dixon added, but final construction costs would not be known until the tender process was complete. The council has sought an urgent meeting with Federal Attorney-General Robert McClelland to discuss the funding shortfall, and Mr Dixon said meetings with Premier David Bartlett and Bass Labor MHR Jodie Campbell had already been held. "The Premier understands the need for additional funding and agrees the project must be seen through to completion as soon as practicable in order to protect the people of Invermay," Mr Dixon said. "He's committed to working with the council and the Federal Government to ensure the project is fully funded." Mr Dixon said he expected to hold further talks with the State and Federal governments in coming weeks, but work on the levee project would continue in the meantime. "The program that we've got requires us to have the whole project completed by December 2012," he said. "The funding we already have allows us to complete the land acquisitions and make a good start on the design and reconstruction of the levees, but we obviously can't complete the reconstruction program without additional funds."

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