The Dalles mulls city manager authority over construction cost increases
Ajax Northwest works on clearing some debris from the pavement as work continues on the First Street Streetscape project in downtown The Dalles. Council is set to discuss giving the idea of giving the City Manager additional authority to keep projects moving at its meeting on Tuesday, Oct. 13, 5:30 p.m.
By Tom Peterson
The Dalles, Ore., Oct. 12, 2026 — The Dalles City Council will consider allowing City Manager Matthew Klebes to approve construction change orders that could total hundreds of thousands of dollars without returning to the council for an individual vote.
Matthew Klebes
The change would likely speed construction by giving City Manager Matthew Klebes the agility to approve qualifying change orders without waiting for a City Council vote on each one, particularly when unexpected conditions threaten to delay work.
Nobody likes delays, especially when access to roads or buildings is extended.
The proposed policy would let Klebes approve cumulative net increases of up to 20% of the original award on qualifying public improvement contracts originally approved by the council for more than $100,000.
The authority would not give the city manager an unrestricted spending allowance. The council approves project budgets, and change orders approved administratively would have to remain within available budget authority. If a project needs additional spending beyond its approved budget, the city would still have to follow the required council budget process.
The scale of the proposed authority is substantial.
For example, Ajax Northwest LLC won the First Street Streetscape construction contract with a bid of $4,069,687 in November 2025. Twenty percent of that amount is about $814,000, although the actual limit would depend on the contract amount and the proposal's other requirements.
The First Street project also illustrates how unexpected conditions can increase the cost of public construction. In June, the council unanimously approved a $364,223 construction change order to address a century-old, 27-inch clay sewer main discovered beneath the intersection of First and Court streets. The change extended the target completion date by 73 days, to July 13, 2027.
Archaeological work has added substantial costs to the First Street project. In April, the council approved a $146,804 amendment for additional monitoring, raising the contract ceiling to $655,789.70. On July 27, the council approved another $146,955 for recovery, excavation and mitigation after crews uncovered an unidentified Native American archaeological feature beneath a retaining wall. State law requires the archaeological response.
The two amendments added $293,759, bringing the contract ceiling to $802,744.70.
Change orders and ammendments demonstrate the financial and scheduling challenges that can emerge after a major public project begins.
Under the proposed policy, qualifying change orders could be handled administratively within the approved budget, reducing the need for individual council votes on those changes. The council would retain authority over project budgets and increases that exceed the proposed threshold.
Strategic Plans
The council also will review progress on its 2026-28 strategic plan.
After the first three quarters of 2026, the city reports that 11 of 110 actions scheduled for the year are complete, a 10% completion rate.
It’s no small list.
The plan covers seven areas, including infrastructure, fiscal sustainability, public safety, housing, economic development and workplace organization. Fiscal sustainability has the highest completion rate at 25%, with two of eight actions complete. The safe, resilient and thriving community category has 11 actions, none marked complete.
Among the unfinished priorities
City of The Dalles Waste Water Treatment Plant. Courtesy City of The Dalles.
Wastewater planning: The city is updating its wastewater facilities master plan, including a 20-year capital improvement plan and recommendations on wastewater rates and system development charges. The city has pursued a $650,000 loan for the planning work. The plan will address treatment capacity, regulatory compliance and a broken outfall pipe.
West Sixth Street Bridge: A feasibility analysis remains unfinished.
Housing: Proposed initiatives include a multifamily housing tax exemption, pre-approved dwelling plans, zoning changes to allow triplexes, fourplexes and cottage clusters in residential zones, and possible deferral of system development charges until occupancy. The update does not assign costs to these individual actions.
Other agenda items include
Scenic Drive property: The council will consider declaring a roughly 0.12-acre parcel between 115 West Scenic Drive and Scenic Drive surplus. The city has no identified independent development use for the property and would retain a 20-foot easement protecting an existing 6-inch water main. The action would not approve a sale or establish a price.
Floodplain regulations: A proposed ordinance would correct drafting errors and inconsistencies in the city's floodplain regulations following their adoption in 2025. Staff says the changes would not alter floodplain designations, permitted uses or development standards. The Planning Commission recommended approval Sept. 3.
The special meeting begins at 5:30 p.m. Tuesday, Oct. 13, at City Hall, 313 Court St. The meeting will be streamed online. Public-hearing testimony may be given remotely without advance registration.
