Forest company in money dispute with North Cowichan walked away from FireSmart job on Mount Tzouhalem
Osprey Forest Operations claimed $104,763 shortfall, according to FOI documents
A Victoria company contracted by North Cowichan to do wildfire mitigation work on Mount Tzouhalem walked away from the job after claiming it lost more than $100,000, freedom-of-information documents reveal.
Osprey Forest Operations Ltd. signed a contract in 2022 to reduce the risk of wildfire on Mount Tzouhalem.
But Osprey never completed the FireSmart grant job as planned in 2023, forcing North Cowichan to hire another company to finish the work, with additional involvement of Cowichan Tribes, in 2024.
FOI documents recently obtained by sixmountains.ca show that Osprey complained to the municipality in 2023 that a slew of factors had contributed to cost overruns.
These included forest-access issues due to an unusually wet April, curtailment of work due to bird nesting and fire danger ratings in summer, and high inflation.
The FOI documents also reference “above average vandalism to our machinery from hostile locals in the insufficiently secure public works yard provided for us to store our equipment….”
Osprey president Greg Witt, in a June 19, 2023, email to municipal forester Shaun Mason provides a project cost report detailing a “shortfall from actual bid” of $104,763.
Later, in an Oct. 24, 2023, email to Witt, Mason writes: “It is North Cowichan’s expectation that you will return to Mount Tzouhalem, before Dec. 31, 2023, to finish the remaining fuel mitigation work to complete the project as per the awarded contract.
“I have been, and continue to be, willing to help reduce costs where possible but there is no option to increase grant funding for this work, which was confirmed with the grant provider and communicated to your foreperson previously.
“I have reviewed the budgets and it is possible that ~$5,000 may be available to supplement this work plus the remaining project balance of $6,853.80 as indicated on your invoice.”
Later that same day, Witt writes back to Mason, stating: “The extreme cost overruns encountered by us due to the site conditions that were considered by all, including you, as extreme and ‘worst in memory’ for the operational conditions encountered.
“Note also that you begged us to start the project over our concerns asking us to ‘try’ to make it work, implying that if that attempt against the conditions did not work you would react with support if the attempt failed due to the conditions.
“This support would obviously have to be financial. You eventually offered the balance of the budget to augment that, but this offer was not followed up and you left us to carry the loss.
“You are in in fact now offering us that money again as new funding after we already accepted it.”
Witt adds: “Fewer company’s (sic), like ours, are willing to take on the risks on these under-budgeted, evolving standards and constantly changing conditions projects.”
Mason further writes Witt on Nov. 22, 2023, noting that Osprey’s $116,971
contract with the municipality included the following language: “No deviations will be permitted from these approved plans nor will additional budget be added to perform this work without written permission and confirmation from the Municipal Forester.”
On Dec. 4, 2023, Mason confirms that Osprey’s “conduct has been accepted as repudiation of the contract and that North Cowichan will now undertake the completion of the project.”
After obtaining legal advice, which is redacted in the documents, Mason adds: “North Cowichan may also seek compensation from Osprey Forest Management as a result of the repudiation of the contract once the work has been completed.”
Mason adds: “Please return the forestry keys that were assigned to you for this project immediately….”
Mason told sixmountains.ca today that North Cowichan did not seek compensation. “It was determined that given the required staff time and anticipated legal costs, pursuing additional legal action was not financially practical.”
The municipality hired a local company, Onsight Tree Services, to complete the “remaining ground work” in 2024, with an additional $40,583 required from the forestry budget.
Cowichan Tribes’ Khowutzun Forest Services also removed additional firewood left at the roadside with no additional cost to the municipality, Mason said.
Further reading: https://www.sixmountains.ca/article/41d607f2-8985-448e-b266-81cb8612bc4a
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