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Auditors to include police headquarters contract in review

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Winnipeg's chief administrative officer said the city hired Dunmore Corporation to manage the construction of the new police headquarters because of its expertise from the football stadium construction.

This afternoon, CAO Phil Sheegl responded to concerns raised by former mayoral advisor Brian Kelcey, who alleged city officials may have violated procurement rules when they awarded Dunmore Corporation the contract to manage construction of the new police headquarters.

Dunmore Corporation's president is Ossama AbouZeid, who also oversaw construction of Investors Group Field, the Winnipeg Blue Bombers' new football stadium at the University of Manitoba.

In a letter to council, Kelcey said the city's policy is to tender consultant contracts that exceed $100,000, but a recent city financial report suggests Winnipeg's public service sole-sourced a contract to Dunmore and paid the company $262,580 in fees to manage the police headquarters redevelopment. The letter also raised concern Adjeleian Allan Rubeli, an Ottawa engineering firm hired to help manage the headquarters project, has been paid $4.5 million. The city initially sole-sourced a contract to Adjeleian Allan Rubeli for a fee that was not to exceed $2.6 million, Kelcey's letter states.

Sheegl said Dunmore was not hired as a consultant, and was providing a service of managing the construction. He said AbouZeid was just completing work on the stadium and the headquarters' design was well underway and the city was working to guarantee a maximum price on the construction so it doesn't spiral out of control.

Sheegl said it would've taken weeks to tender a contract and bring someone up to speed.

"I'm the chair of BBB Stadium and watched him hands-on and the great work that he did there and he comes highly recommended," he said, following council's last meeting of 2012.

Sheegl also clarified that there was no cost overruns related to the Ottawa-based engineering firm. He said Adjeleian Allan Rubeli completed the work they were paid $2.6-million to do. There was a change in the scope of their work, Sheegl said, and the firm was also paid to complete the work a previous engineering firm did not finish because they parted ways with the city.

He said it was money that was within the city's budget, and there were no cost overruns.

"Dr. AbouZeid was just completing his work on the stadium and did a great job there so we retained him," Sheegl said.

City auditors will review contracts awarded to manage the police headquarters construction in the ongoing investigation into Winnipeg real-estate deals.

This afternoon, finance chairman Coun. Russ Wyatt (Transcona) confirmed City of Winnipeg auditor Brian Whiteside will include concerns raised about contracts related to the new police headquarters in the broader city real-estate audit.

"This will be part of the work they're doing as part of the real-estate audit and it will be given a priority," Wyatt said.


Updated on Wednesday, December 12, 2012 at 10:25 AM CST: Updates with Sheegl comments.

1:42 PM: Updates with comments from finance chairman Coun. Russ Wyatt.

3:49 PM: updates with full writethru

3:59 PM: Corrects headline.

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