Winnipeg Free Press - PRINT EDITION
Posted: 07/16/2014 1:00 AM | Comments: 0
Given the rate embarrassing audits are piling up at city hall, Mayor Sam Katz ought to buy one of those erasable signs that would allow him to pencil in the number of days since the last revelation of severe mismanagement.
On Tuesday, the consulting firm KPMG presented an audit into Winnipeg's police headquarters, a project originally sold to the public as a $135-million job that would make more financial and operational sense than simply re-cladding the crumbling exterior of the Public Safety Building.
The police HQ is now a $210-million project that's seven months late and counting. As the Free Press has reported over the past 18 months, this involved the $29-million purchase of a used building with no serious consideration of other options, a flawed design process, a series of change orders and a "guaranteed maximum price" agreement based on drawings that were only 30 per cent complete and subject to change.
To the surprise of absolutely no one, KPMG concluded the project was, in vernacular terms, seriously screwed up.
City officials didn't follow policies put in place to prevent major construction projects from going sideways, failed to tell council about problems for months and didn't follow policies put in place to promote open and competitive bidding, KPMG concluded.
If that sounds awfully familiar, it should. In October 2013, consulting firm Ernst & Young lambasted senior officials for the mismanagement of the $18-million fire-paramedic station replacement program, breaching city policies, giving preferential treatment to a single firm and keeping council in the dark.
On July 2, in a separate audit of major city real estate transactions, EY lambasted senior officials for buying the former Canada Post building without an independent appraisal, keeping valuations of the Winnipeg Square Parkade and Parcel Four from council, rushing into the Parker land swap without any serious number-crunching and providing the eventual buyer of the former Canad Inns Stadium site with an advance copy of the city search document.
In case you're keeping score, that's three times in nine months where independent auditors determined Amateur Hour has lasted several years at city hall.
This is infuriating, as it was only 2008 when the city accepted the recommendations of a capital-projects audit that was supposed to prevent cost overruns from ever happening again. The police HQ and the fire-paramedic station construction program proceeded in 2009.
According to Katz, who plans to retire from city hall in October, this is not his fault or that of his good friend and confidant, former chief administrative officer Phil Sheegl.
In October, the mayor agreed corners were cut on the fire-paramedic station program but refused to pin any blame on Sheegl, who resigned days before the release of that audit, which was officially called a review.
On July 2, Katz dismissed the real estate audit for also being called a "review" and also because auditors chose not to interview Sheegl or Shindico Realty president and CEO Sandy Shindleman.
And on Tuesday, Katz blamed former Winnipeg CAO Glen Laubenstein for lowballing the initial cost of the police-headquarters project. This is remarkable, considering it was Sheegl who took credit for making the police HQ project possible in the cover letter for his application to become CAO in 2011.
There are many disturbing findings embedded in the 52-page police-HQ audit. Winnipeggers still wondering how former Winnipeg Fire Paramedic chief Reid Douglas was encouraged to make real estate deals may be annoyed, if not surprised to learn "serving and retired officers" with no formal project-management training were handed oversight roles on a major construction project.
Winnipeggers still perturbed by the unfairness implied by the previous two audits may be annoyed, if not surprised to see KPMG criticize the way the city awarded $172 million in construction work to Caspian Construction.
Winnipeggers angry at the way administrators kept key details of the fire-paramedic station program and the proposed sale of Parcel Four from council may be annoyed, if not surprised to see KPMG criticize senior officials for keeping police-HQ problems from elected officials.
But hey, it's only severe mismanagement. Just another day at city hall, where everyone has grown so accustomed to incompetence and cowardice, they barely even notice it any more.
Republished from the Winnipeg Free Press print edition July 16, 2014 A4
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