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City auditors to watch costs of new roads

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CITY auditors have been asked to examine the construction of new roads in Waverley West to see whether Winnipeg can avoid getting stuck with the tab for cost overruns on projects funded by all three levels of government.

City council's finance committee voted Monday to ask auditors to review the Waverley West Arterial Roads Project, which involves the extension of Kenaston Boulevard from Bishop Grandin Boulevard to the Perimeter Highway, the construction of new intersections and other road improvements.

The city, province and Ottawa announced the project in 2009 with the intention each level of government would shoulder roughly one-third of the $54.7-million cost. But earlier this fall, members of council's executive policy committee were told the project was over budget by up to $20 million.

According to a public works report, a partial overpass at the Kenaston-Bishop Grandin intersection will cost an additional $10 million, due to imprecise initial estimates. A one-year delay on the project, caused by a federal environmental assessment, added another $5 million to the cost, the report states.

As well, a possible provincial decision to change the nature of the Kenaston-Perimeter intersection -- which will eventually replace the existing Waverley Street-Perimeter intersection -- may add another $5 million to the cost, the report states.

The City of Winnipeg expects to shoulder most of the cost overruns, as any costs not included in original tripartite funding deals tend to fall to the municipal government. Those costs include preparation work, Mayor Sam Katz complained in November.

As a result, city council finance chairman Russ Wyatt (Transcona) authored a motion to ask city auditors to figure out ways to reduce the city's risk the next time Winnipeg signs a funding deal with the other two levels of government.

"The city must do what it can to protect itself," Wyatt said following the committee vote, which also called for $15 million to be set aside in future capital budgets to cover the Waverley West cost overruns.

Wyatt expects the province to cover the remaining $5 million because it "came in at the 11th hour" with a request to re-examine the Perimeter intersection. "The Perimeter has always been their responsibility," he said.

The NDP government did not respond to requests for comment.

St. Norbert Coun. Justin Swandel, however, criticized Wyatt for asking city auditors to do the work of politicians.

"It seems to me the word 'audit' has just become a way to get your name on the front of the newspaper," said Swandel, who represents Waverley West.

Other council finance committee decisions on Monday:

-- Surplus cash: Couns. Russ Wyatt (Transcona), Paula Havixbeck (Charleswood-Tuxedo) and Grant Nordman (St. Charles) voted to spend a projected $8.5-million budget surplus on something other than the city's fiscal-stabilization fund early next year. Pending council approval on Dec. 12, this would mean the city could use a 2012 operating-budget surplus to help reduce the size of a property-tax increase expected in 2013.

-- Budget consultations: Finance committee also voted in favour of chairman Wyatt's plan to conduct budget consultations for 2014 during the first six months of 2013, through means such as polling, holding public meetings, arranging focus groups and inviting online input.

Republished from the Winnipeg Free Press print edition December 4, 2012 A8

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