Contact: John Shorrocks, ext 7030 email: [email protected]

1. Summary

1.1 The following decision is sought:

That the virement of £281,000 additional funding from the Local Transport Plan be approved,

1.2 On 11 July 2002 the Executive Member for Policy and Resources agreed the capital allocation of £687,000 for the A27 Portchester Road, Fareham Cycleway. This report details the additional costs expected to be incurred with the completion of the scheme and seeks approval for the necessary additional funding.

1.3 A study of the estimating procedure in the Environment Department is currently being finalised by staff in the County Treasurer's Department in consultation with other departments. New procedures will be introduced shortly to improve the financial forecasting and monitoring of costs.

2. Reason

2.1 This project supports Aims 2 and 4 (Stewardship of the environment and Building strong and safe communities) of Hampshire County Council's Corporate Strategy by providing accessible facilities for travel other than by car and by assisting in the objective to improve road safety.

2.2 A decision on the original Project Appraisal was deferred by the Executive Member for Environment in May 2002 pending consideration by the former Fareham Highway Management Advisory Panel (FHMAP) on 1 July 2002. The scheme was supported by the FHMAP and the Project Appraisal approved by the Executive Member for Policy and Resources on 11 July 2002 for a planned start in September 2002. Additional design and contract preparation matters delayed the start of the works until April 2003.

2.3 Since the Project Appraisal estimate, substantial additional costs have become apparent. These are detailed in the main body of the report, the major items being increased fee levels charged to the project and an increase in the main works cost. The additional £281,000 will need to be funded from the Transport Capital Programme.

3. Other Options Considered and Rejected

3.1 Not to approve would require the funding to be found from other sources as the expenditure has already been committed.

4. Conflicts of Interest Declared by the Decision Maker or a Member or Officer consulted - None.

5. Dispensation granted by the Standards Committee - Not applicable.

6. Reason(s) for the Matter being dealt with if Urgent - Not applicable.

Approved by: Date:

Councillor K B Estlin

7. Introduction

7.1 The A27 Portchester Road, Fareham Cycleway is part of an extensive network of cycle routes and facilities originally identified in the Fareham Cycle Plan 1996. It forms part of the Portsmouth to Fareham length of the south coast cycle route section of the National Cycle Network. It also provides safe cycle facilities for access to Cams Hill School from the extensive areas of residential development to the south and east and significant improvements to existing provision for cycle access from the west.

7.2 At the time that the Project Appraisal estimate was prepared, the two elements of the project (east and west of Cams Hill School) were in different stages of development. The design of stage 1 (east) was well advanced. Stage 2 had only been the subject of a preliminary design study.

7.3 Additional costs in both works and fees emerged during the development of the project. Many of the additional works costs are associated with the further development of the Stage 2 design. The fee increases are in part due to an exceptional level of public comment about the works themselves and the construction practices and resulting disruption.

8. Project Cost Comparisons

8.1 The attached appendix shows the current estimated cost of the project compared with the estimates in the original Project Appraisal. The current estimate of the outturn cost is £973,000 which is an increase of £281,000. It should be emphasised that, although the works have been completed, their final account is not yet agreed and the fee levels to reach that agreement have been estimated.

8.2 The major elements of the additional costs are split between fees (£164,000) and works (£117,000).

Additional Fees Prior to Contract Award (£118,000)

8.3 Additional investigative and design work on the north side of the A27 at Beaulieu Avenue and Condor Avenue was considered necessary. The objectives were to provide an improved crossing facility for cyclists (Condor Avenue) and to examine the feasibility and cost of providing a central refuge for cyclists in the A27 at Beaulieu Avenue, including widening the A27 on its north side.

(i) Changes needed to be made to the proposed Traffic Regulation Orders and associated drawings and documentation after a second round of consultations with the Borough Council and the Police.

(ii) The contract document underwent a complete rewrite between June and September 2002 following a change in usage from the fifth edition to the seventh edition of the Institution of Civil Engineers Conditions of Contract.

(iii) During the period in question (July to December 2002) there was a significantly greater than expected level of public and other dialogue and consultation.

(iv) There was an underestimate of the residual design resource requirement.

Additional Costs After Contract Award (£163,000)

8.4 Construction of Phase 1 of the works (Beaulieu Avenue to Shearwater Avenue) eventually began in April 2003. At the same time the detailed design of Phase 2 (Shearwater Avenue to the Delme Arms Roundabout) was being finalised. The additional costs that have arisen since that date can be categorised as:

(i) additional works costs associated with unforeseen elements of Phase 1;

(ii) additional works costs in Phase 2 associated with the development of this phase from preliminary to detailed design; and

(iii) additional fees to deal with items (i) and (ii) and to manage the continued high level of public comment throughout the construction phases.

8.5 The main causes of additional works cost are:

(i) change from overlay to full footway/cycleway construction;

(ii) footway re-profiling to deal with late emerging property flooding issues;

(iii) additional temporary school crossing patrol;

(iv) carriageway edge repairs;

(v) additional retaining wall following Phase 2 preliminary design development;

(vi) omissions from the schedule of quantities;

(vii) changes to Phase 2 lighting design due to the location of buried services;

(viii) late inclusion of restricted working hours; and

(ix) contingency sum for indirect costs associated with the above items.

9. Funding

9.1 The A27 Portchester Road, Fareham Cycle Scheme was originally allocated £675,000 from the Transport Capital Programme (TCP) and £12,000 developer contributions. The TCP allocation was subsequently altered to £680,000 on 24 June 2003.

9.2 The additional funding required for the overspend as outlined in the report is £281,000, which will be from the TCP. Due to the late award of major scheme funding for the A3 bus priority corridor, no other projects need to be deferred to accommodate this increase.

10. Conclusions

10.1 Of the £281,000 overspend a substantial proportion (£164,000) is attributable to increased fees. The works costs are estimated to increase by £117,000.

10.2 The fee element of the overspend is made up of an underestimate of resource requirements at the Project Appraisal stage, additional elements of design and contract preparation and substantial additional resource for public/community liaisons and communication.

10.3 The increased works costs arose mainly from the further scheme development of phase 2 works and some unforeseen circumstances in phase 1.

8565/JES

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