After an almost two-year delay triggered by a budget shortfall, construction will start next week on a new $4,076,565 fire station at the corner of Siskiyou Boulevard and Highland Drive — and at a price that's under budget.

Medford City Council approved a contract Thursday with Adroit Construction Inc. of Ashland, paving the way for a groundbreaking ceremony at Fire Station No. 3 at 9:30 a.m. Thursday, July 13.

The new fire station will be built to the south of the existing station, and it will be financed from $38 million in bonds that also built fire stations No. 2 and No. 4, a police station and improvements at U.S. Cellular Community Park.

In September 2015, the council discovered it was $6 million short when it was poised to approve construction of three fire stations and the police station. At the time, subcontractor bids came in higher than expected.

As a result, the city worked to cut costs but also tabled Fire Station 3. The other two stations together cost $10.6 million.

Councilor Kevin Stine said it wasn't a perfect process, but the city fulfilled its promise to build three new fire stations and a new police station.

"We battled through it, and we are where we are," he said.

Councilor Dick Gordon wanted assurances Thursday that the subcontractor issue was resolved this time.

"It looks like we've not gone out to bid for the subcontractors," he said, after reviewing documents provided by city staff.

Medford Project Manager Rick Isner said that all the bids had been received from the subcontractors and that Adroit is standing behind the guaranteed maximum amount for the project. He said a lot of work went into bringing the project in under budget.

The budget for Fire Station 3 was $4,505,000, and $52,983 has already been spent in preparation for construction.

That leaves a balance of just over $375,000 that was earmarked for the fire station but that now can be spent by the city on other projects.

"They did great work in getting that GMP (guaranteed maximum price) down that much," City Manager Brian Sjothun said.

— Reach reporter Damian Mann at 541-776-4476 or Follow him on