06/18/2014 03:05 EDT | Updated 08/17/2014 05:59 EDT

Bluenose II restoration cost up to $19M and counting, Nova Scotia committee told

HALIFAX - The cost of restoring the Bluenose II has risen to $19 million and that figure is likely to keep climbing as a result of invoice disputes with contractors and numerous changes to a troublesome steel rudder, the Nova Scotia government said Wednesday.

Kelliann Dean, the deputy minister of communities, culture and heritage, appeared before the public accounts committee to provide an update on the project, which has been mired in delays and cost overruns.

Dean said there have been seven redesigns of the rudder and steering system and debates over changes to the rudder date back to 2010, when the project team for the restoration of the Bluenose II was told it needed a steel rudder rather than the lighter, wooden version used in the original vessel.

It was the goal of the team to have a modern, safe steering system that met certification standards while retaining the look of the historic racing schooner, but a series of disputes and design changes followed, Dean said.

Poor communication between the government, the designers and shipbuilders have also played a role in driving the costs up $4.6 million from the project's original budget, she said.

Part of the latest price jump is an advance of $1.3 million on $5 million in disputed invoices with the builder. Dean said $500,000 of the advance has some conditions attached.

After her appearance before the committee, Dean said a dispute resolution process will determine how much of the outstanding invoices will be paid out.

"We're waiting for a report from the builders that justifies and provides the accounting for that claim and we will have that expertly reviewed," she said.

The delivery of the Bluenose II is more than two years behind schedule. Just last month, a long anticipated test drive in Lunenburg, N.S., had to be cancelled at the last minute because approvals were not secured from the American Bureau of Shipping. That test drive has yet to proceed and sea trials would then take place.

Progressive Conservative member Tim Houston said he's concerned because while there are many parties involved in the problems, nobody is taking responsibility for them.

"Everyone's in charge ... but nobody's leading," Houston said. "In the meantime, time is going past, money is being spent and bills are piling up and there's no indication of the project being finished.

"The project is waffling along."

The provincial government recently hired a consultant to help look at problems with the rudder. Wilson Fitt of Costello Fitt Ltd. will report to the deputy minister in the premier's office.

Nova Scotia's auditor general is also reviewing the restoration.

The Bluenose II, launched in 1963, is a replica of the original Bluenose, a Grand Banks fishing schooner that won worldwide acclaim for its graceful lines and speed.

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