A city utility plan that kept getting murkier

The first time I typed the words "corporate utility" in my basement office at city hall, I could practically hear my editors yawning five kilometres away on Mountain Avenue.

Initially, there didn't seem to be anything sexy about Winnipeg's plan to replace its water-and-waste department with an arm's-length corporation that would be responsible for completing the city's expensive sewage upgrades and overseeing the mundane tasks of garbage collection, waste-water treatment and water distribution.

When the idea was initially announced back in 2008, the most interesting aspect of the proposal was the possibility Winnipeg would run its own alternative power utility and get into the business of using wind, solar energy and biomass to generate electricity.

Some of the city's less ethical activists seized on the idea the utility amounts to the privatization of city services, even though there was no evidence to back up that assertion.

There was a fuzzy plan to get in bed with a "strategic partner" to complete about $615 million worth of upgrades at three sewage-treatment plants, but that had more to do with trying to keep consulting costs down and reducing communication errors with contractors than anything genuinely nefarious.

Generally speaking, municipal governments aren't capable of constructing conspiracies. But they are prone to garden-variety incompetence.

On the second-last day of June, as most Winnipeggers prepared for the Canada Day holiday, the city lived up to the municipal reputation by publishing a 91-page business plan that made what previously seemed to be a solid utility plan seem sort of iffy. The main problem was the "strategic partnership" component, which was murkier than ever.

What would it actually do? How would it make money? Why would any private consulting firm be interested in getting involved?

None of those questions was answered, so during the first week of July I wrote a column and a couple of stories that were slightly critical of the endeavour.

In response to those stories, utility co-creator Bryan Gray and Winnipeg chief administrative officer Glen Laubenstein requested an audience with the Free Press editorial board. I tagged along, hoping to play the role of intermediary.

What transpired over the next hour was one of the weirdest things I'd ever witnessed during my career as a reporter. Gray and Laubenstein contradicted each other. The CAO argued with Free Press columnist Dan Lett. Eventually, Laubenstein conceded he wasn't aware of the details of the "strategic partnership" plan.

After the meeting ended, the editorial board, Lett and I concluded it would be impossible for council's executive policy committee to approve the utility plan the following week without conducting some form of major surgery to the business plan.

There was tinkering, but EPC and council still approved the plan before politicians took a break for the summer.

In the fall, after the city whittled down a list of prospective strategic partners to three finalists -- the Canadian subsidiaries of CH2m Hill, Veolia and Black & Veatch -- I wrote a snarky column about how a similar engineering firm was the real-life inspiration for the villain in the latest James Bond movie.

That provoked a polite response from CH2m Hill Canada and an interview that made it clear how the strategic partner might work: An engineering firm would share offices with the new utility to improve communication. The arrangement would not involve any equity. The partner would only provide design, construction and possibly management services. This model has apparently proved very effective during the construction of British Petroleum oil rigs.

Early in the new year, the city will settle on a strategic partner. For the sake of the city, never mind the utility, I urge our public servants to go far, far out of their way to explain the rationale, once and for all.

bartley.kives@freepress.mb.ca

Republished from the Winnipeg Free Press print edition January 4, 2010 B1