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Mayor, councillors blame project manager for police HQ woes

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The blame for $17.2 million in cost-over runs for the new police headquarters is falling on the project manager hired to shepherd the project, Ossama AbouZeid.

Mayor Sam Katz and several councillors identified the latest over-runs on the project this morning, but never mentioned AbouZeid by name.

Councillors Paula Havixbeck and Jenny Gerbasi said they had been cautioned by city legal staff not to identify any company or individual alleged to be responsible for mishandling the project.

Katz said he wasn’t satisfied with the work done by the project manager, adding he let the city down.

"How can you be satisfied with anybody who is supposed to be protecting the interests of the city and here we are," answering these questions, Katz said. "I’m not happy at all."

Katz said he didn’t know if the project manager was still involved in that role.

AbouZeid could not be reached for comment.

AbouZeid was hired to manage the project in 2011, based on his track record as CEO of the Winnipeg Football Club and his boast at the time that he was able to have Investors Group Field built for a guaranteed price.

AbouZeid’s company, Dunmore Corporation was given an untendered contract to manage the police project for $263,000.

'I'm beyond displeased': Mayor

Scott Fielding, the former chair of the protection committee who resigned his position last week, said vital information had been withheld from councillors, adding he holds the project manager responsible.

"When you have cost over-runs, you need as much transparency and openness as possible," Fielding said. "There’s a project manager that was in charge of the project."

Katz said the bulk of the financial over-run came from $12.5 million for additional mechanical and electrical work that was never included in the original drawings sent to the contractor.

"I’m beyond displeased," Katz told reporters, saying council was told there was a guaranteed maximum price on the project but that was not possible when only 30 per cent of the finished drawings were given to the builder.

Katz said the additional money to finish the project will be borrowed.

The mayor explained the entire project was financed through borrowing over a 40-year term but budgeted for a higher interest rate. The actual interest rates were actually lower, he said, so the city can still afford to borrow the additional funds without impacting any other department budget.

Moving price tag

Katz added confusion to the project when he said the total price, including the cost overruns, will be $177.4 million. Published reports had the project costing $194 million before the latest cost overruns were identified.

Cost overruns have plagued the police headquarters project from the beginning.

The city purchased the building and the 10-storey officer tower for $31.5 million and budgeted $99 million for renovations.

By 2010, the project had climbed to $168 million.

One month after AbouZeid was hired in 2011, the project cost rose again, to $194 million, which council was told at the time was a guaranteed maximum price.

Katz said this morning the cost of the tower portion should be removed from the project, adding he expects the tower will eventually be sold for $18.6 million or more.

Katz said the $7 million originally planned for a roof-top shooting range should not be included in the project price, explaining the range was deleted to save money and would be built elsewhere.

Katz said that despite the cost overruns, the building will more than meet the needs of the Winnipeg Police Service.

"We have a first-class facility for the men and women of the WPS," Katz said.

Katz said the construction project is on schedule, with a completion date of June 30.

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