Police liaison on HQ project tells inquiry he had concerns about costs, took them to superiors

A police liaison on the Winnipeg Police Service headquarters project said he feared he was being kept in the dark on some financial details, especially as cost overruns emerged.

Randy Benoit, who served as the liaison on the project for 2 1/2 years, said he grew quite frustrated as he repeatedly heard about overruns from key contractor Caspian Projects, though he had little knowledge of the original budget.

“There’s something else going on around me that’s being kept from me, and I’m suspicious of that,” Benoit said Tuesday at the public inquiry into the project.

The comment came in response to a November 2011 email displayed at the hearing in which someone else referred to Benoit as being angry about the project.

He recalled repeatedly raising concerns to his superiors about the rising construction tab, since he lacked the authority to demand receipts or other financial information.

“We need some solid numbers back to make decisions on,” he said.

Problems with the headquarters project at 245 Smith St. have plagued city council for years. The building opened in June 2016 at a cost of $214 million, well above its original $135-million price tag. An external audit found it was severely mismanaged.

Benoit said security costs were one specific point of contention between himself and Caspian owner Armik Babakhanians.

“That was one of the areas in construction that Armik would always argue with me to try to push it out of (what was covered in the project’s guaranteed maximum price)…. This was a constant back-and-forth struggle,” said Benoit.

He said he was told the security budget had risen by about $1.8 million by 2013.

“I never saw any backup for it. I never saw any receipts for it,” he said.

Benoit said police also raised concerns about parking at the new headquarters since existing spaces set to hold cruiser cars would not actually fit them, in part due to low-lying pipes and the position of some light bars. One wall that was expected to stay in place was also “crumbling,” casting doubt on its life expectancy, he said.

Benoit said money was also moved out of the budget intended for furnishing, fixtures and equipment to cover other costs, creating concern that category would be underfunded.

In September 2013, he noted there was talk of issuing a stop work order to Caspian over the rising overall budget, which he said the company’s owner resisted.

“Armik (Babakhanians) made it clear to me… that even if we tell him to stop, which had been done on the phone the previous day, he’s not stopping, he’s got to get this built and it’s going his way and there’s no stopping this,” said Benoit.

Babakhanians testified at the inquiry Friday, noting he was proud of his work on the project but thought it sometimes suffered from a lack of understanding about the needs of police and the complex construction requirements of the building.

On Tuesday afternoon, Ossama AbouZeid, the project’s director, said he also pushed Caspian to provide documents that backed up its cost claims.

“First, I have to establish and satisfy myself, before I consider any extra (cost), that the baseline (budget) is correct… I would like to be sure that the extra is justified,” said AbouZeid.

However, he said he also had a duty to ensure that the finished headquarters was built to the original quality expected, not cut back to stay within budget.

“I (could not) accept lower quality to (get) the number met,” he said.

The project did have some flexible funding to cover unexpected costs, including a contingency budget within the amount set for furnishing, fixtures and equipment, he said.

After he made an October 2013 presentation about the rising price of the project, AbouZeid said some city councillors publicly blamed him for the overrun.

He said that experience ultimately led him to leave the project.

Multiple legal challenges followed the HQ construction. In 2020, the City of Winnipeg launched a civil suit against Caspian and dozens of other defendants, alleging a fraudulent scheme inflated the price of the project.

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Heather Leonoff, the legal counsel for the provincial inquiry, asked AbouZeid if he ever told, or heard anyone tell, any member of Caspian that backup documents could be changed, altered or faked, to which he answered “absolutely not.”

Leonoff also asked if he was ever told by anyone at Caspian that any documents submitted were altered, changed or faked in any manner. He answered “never.”

The inquiry continues Wednesday.

joyanne.pursaga@freepress.mb.ca

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Joyanne Pursaga
Reporter

Joyanne is city hall reporter for the Winnipeg Free Press. A reporter since 2004, she began covering politics exclusively in 2012, writing on city hall and the Manitoba Legislature for the Winnipeg Sun before joining the Free Press in early 2020. Read more about Joyanne.

Every piece of reporting Joyanne produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press‘s tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.