Lahden urban development director regrets significant error in street maintenance tender process

Lahden’s Urban Development Director Olli Alho has expressed regret over a significant error in the tender process for street maintenance, which will not require the city to seek additional savings. The miscalculation raised the project’s target price substantially, leading to an increase in expenditures by €3.5 million over five years. The mistake occurred when the city failed to include an area designated for weed removal in the bidding documents. As a result, YIT quoted €1,000 per square meter for the work, while the market rate is typically around €0.20 per square meter. With 7,000 square meters to address, this exorbitant quote inflated the contract’s target cost, despite weed removal being a minor component of the overall agreement.

The city and YIT exchanged blame during the tender selection process, with the unusual pricing going unnoticed. Alho noted that the oversight was a human error, influenced by the complexity of the extensive Excel data used. The error only came to light a year after the contract commenced.

Initially, any savings from the target price were to be shared, but disagreements arose regarding the additional area that had not been marked on documents. Eventually, both parties reached an agreement, reducing the pricing for greenery maintenance from €1,000 to €100 per square meter. Despite still being above the market rate, the annual target price will now increase by €700,000.

Alho clarified that although the target price has risen, it does not necessitate further budget cuts, as the budget had already anticipated the actual costs of the works. The city is also implementing savings measures in winter maintenance that do not relate directly to this issue.