Winnipeg Free Press - PRINT EDITION

Ernst & Young hired to probe fire-hall project

Team begins investigation Monday

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The external review into Winnipeg's fire-paramedic station replacement program will begin on Monday when a team of investigators from Ontario will begin picking apart the beleaguered project.

The accounting firm Ernst & Young LLP has been awarded a $230,000 contract to review the way the City of Winnipeg built new stations in Sage Creek, Charleswood, River Heights and St. James, the city's materials management website says.

The issue has preoccupied city hall for three months due to councillors' anger over the construction of the new River Heights station on private land, a proposed swap of this property for three parcels of city-owned land and cost overruns at the St. James station, among other concerns.

The review will cover the initial impetus for building the new stations, the way contracts were awarded, the value of the work for taxpayers and all processes, controls and policies involved in the program. Ernst & Young will also be asked to make recommendations and suggest disciplinary action, if needed.

Charleswood-Tuxedo Coun. Paula Havixbeck said she looks forward to learning answers to questions senior city officials have not answered about the financial aspects of the program, whose price tag has risen to $17.8 million from $15.3 million.

"They explained $62,000 in cost overruns (at the Sage Creek station) last June better than they did the whole $17-million program," Havixbeck said. "The real work is just beginning and finally we'll get some answers. I hope all the necessary people are really engaged in this."

The review team will be led by five key members from Ottawa with experience auditing all three levels of government, city audit manager Bryan Mansky said Wednesday.

The city ensured the review team is based outside Manitoba to avoid a real or perceived connection to the City of Winnipeg or private-sector companies that do business with the city, he said.

"They will have some preliminary meetings, starting on Monday," he said, adding he is not certain how long the work will take.

The scope of the review, however, makes it all but certain the Ernst & Young team will require several months to complete the job. A broader city real-estate audit slated to begin in December, when another outside firm is chosen, will take even longer, but should wrap up in 2013, Mansky said.

"If we had a larger office, I would love to do these in-house," he said, noting special expertise is required for both the fire-paramedic review and the real estate audit. The city has authorized initial spending of $500,000 to cover both the review and audit.

St. Boniface Coun. Dan Vandal, who pushed for an external review of the fire-paramedic construction program, said he hopes Ernst & Young will ensure the city does not make similar mistakes again.

"I'm not crazy about spending that sort of money, but we have to make sure we're protecting taxpayers' money in the future," Vandal said.

Republished from the Winnipeg Free Press print edition November 22, 2012 A4

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