Cost of city reorganization increases by $212,000

THE price tag for Winnipeg's reorganization is now approaching $600,000, as the city didn't include a computer-company contract when it came up with the cost of the two-year-old job.

City records reveal Winnipeg paid a consulting firm almost $212,000 last year to help consolidate its information-technology systems -- above and beyond the $372,000 the city already disclosed it spent on reorganizing the public service as a whole.

In June 2008, Winnipeg chief administrative officer Glen Laubenstein launched a reorganization that saw the city dissolve two entire departments, eliminate 83 full-time-equivalent positions and place the city auditor and city clerk under the auspices of the CAO instead of council.

Over the next 15 months, the city spent $372,000 on consulting fees, expenses, meetings and retreats to plan and implement the reorganization, the Free Press reported in October after filing a freedom-of-information request. Almost $190,000 was spent on fees and expenses incurred by a single Montreal consultant in a series of sole-sourced contracts.

In response, the city said it will achieve $10.5 million in annual savings because of the reorganization. About $1.5 million of those savings will flow from an information-technology consolidation, Laubenstein said in an Oct. 8 press release.

"Before the reorganization, every department had (its) own server and staff. Now we are in the process of consolidating all the servers, which will enable information to be processed and shared more quickly and at significantly lower cost," he said at the time.

Now, the city concedes it did not account for the costs of the information-technology consolidation. The $372,000 reorganization tab disclosed by the city did not include a separate information-technology assessment, internal services director Linda Black confirmed in an interview.

In 2008, the city paid Gartner Canada Co. $211,551.20 to assess and plan the consolidation of Winnipeg's information-technology services, according to the city's annual disclosure of spending on consultants. The spending was part of a $280,000 Gartner contract that was not tendered, the consulting report states. The assessment was commissioned by former internal services director Luella Lee as part of a city-wide effort to find more efficient ways of doing business, Black said.

"A number of initiatives were undertaken as a result of the Gartner review," she said. The remainder of the $10.5 million in annual savings credited to the reorganization will be achieved through internal efficiencies and reductions to city staff, the city stated in its press release. But some members of city council remain skeptical of this claim.

The executive policy committee is expected to table the 2010 operating budget in February.

bartley.kives@freepress.mb.ca

Republished from the Winnipeg Free Press print edition November 6, 2009 B1