REQUEST FOR DECISION
DATE: July 20, 2026 Report No. P&R-26-011
TO: Dan Horan, Chief Administrative Officer
FROM: Dan Henderson, Manager of Facilities
SUBJECT:
Title
Esquimalt Recreation Centre Pool Dehumidifier Replacement - Contract Award
End
RECOMMENDATION:
Recommendation
That Council award the contract for the Esquimalt Recreation Centre Pool Dehumidifier Replacement to Archie Johnstone Plumbing & Heating for $943,171 (excluding GST) and reallocate up to $117,944 from the garbage bin enclosure project to the pool dehumidifier replacement project.
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RELEVANT POLICY:
Financial Plan Bylaw, 2023, No. 3096
Purchasing and Disposal Bylaw, 2014 No. 2845
STRATEGIC RELEVANCE:
Local Services and Infrastructure
Good Governance and Organizational Excellence
BACKGROUND:
The Pool Dehumidifier is an important part of the Recreation Centre HVAC system; it plays a key role in circulating and dehumidifying the air in the pool. The Pool Dehumidifier has reached its life expectancy, after 22 years of service. Polar Engineering was retained to provide design, mechanical, electrical, and structural consulting on this project.
This project is running in conjunction with the Esquimalt Recreation Centre Roof Replacement (Roofs 9, 10, & 11). This coordinated approach is expected to create savings by avoiding the need to remove and reinstate roofing assemblies a second time to replace major rooftop mechanical equipment at a later date. It also reduces labour requirements, shortens the overall construction timeline, and limits the number of operational shutdowns or disruptions required at the Recreation Centre
A tender was issued for purchase of the preselected Engineered Air Dehumidifier (Model LMD30/C/MV/H) and its installation on June 22, 2026. The tender closed on July 6, 2026 and the Township received the following 6 eligible bids:
Archie Johnstone Plumbing Heating $943,171 + GST
MGM Mechanical Ltd. $950,760 + GST
Summit Mechanical Systems Ltd. $986,886 + GST
VIS Mechanical $989,000 + GST
Blackrete Builders Inc $1,114,000 + GST
Entity Mechanical Ltd. $1,140,000 + GST
ISSUES:
1. Rationale for Selected Option
Polar Engineering and staff have evaluated the bids and determined that the bid from Archie Johnstone Plumbing & Heating met all the requirements and was the lowest bid.
2. Organizational Implications
This contract will be managed by Facilities staff, along with Polar Engineering, within existing resources.
3. Financial Implications
The Pool Dehumidifier Replacement project is included in the approved 2026 Capital Budget and is currently supported through funding from R263 - HVAC Replacement - Recreation Centre, with a budget of $900,000. In addition to the approved municipal funding, the Township has submitted an application to FortisBC’s Custom Efficiency Program for financial support toward the installation of a new, more energy-efficient pool dehumidification system.
The FortisBC Custom Efficiency Program provides incentives for projects that reduce energy consumption and improve building system performance. Based on the proposed equipment replacement, the Township is estimating a potential incentive of approximately $260,000. If approved, this funding would reduce the net cost of the project to the Township and improve the overall value of completing the dehumidifier replacement in coordination with the Recreation Centre roof replacement. See chart below:
Funding Source
Capital Project Reserve- R263 HVAC Replacement $900,000
FortisBC - Custom Efficiency Program estimated incentive $260,000
Total Funding $1,160,000
Expenses
Archie Johnstone Plumbing & Heating Purchase and installation $943,171 +GST
Polar Eng Consulting, design, mechanical, electrical, and structural $74,773 +GST
Total Expenses $1,017,944 +GST
There is a financial risk if the FortisBC incentive is not approved or if the final incentive amount is lower than anticipated. Without the grant funding, the Township would need to fund up to $117,944 of the project through another project or through a capital reserve in order to coordinate the timing and cost savings of completing this project alongside the roof replacement. Currently the garbage bin enclosure project is not expected to cost $175,000 in 2026, so up to $117,944 could be reallocated by Council. Polar Engineering has signaled confidence is high that the grant funding will be successful.
4. Sustainability & Environmental Implications
The Esquimalt Recreation Centre Pool Dehumidifier Project will allow the Township to reduce its GHG emissions with new, more-efficient pool dehumidifier.
Further, we will continue to invest in future phases of this project in 2027, to add further reduction to our GHG emissions.
5. Communication & Engagement
Any issues or concerns that may impact services will be communicated to Council and the public through the appropriate channels.
The successful bidder will be notified verbally and in writing that they have been awarded the contract.
ALTERNATIVES:
1. That Council award the contract for the Esquimalt Recreation Centre Pool Dehumidifier Replacement to Archie Johnstone Plumbing & Heating for $943,171 (excluding GST) and reallocate up to $117,944 from the garbage bin enclosure project to the pool dehumidifier replacement project.
2. That Council provide alternate direction to staff.