The members of city council want answers about when and how the roughly $9.85 million in cost overruns on the new underground parkade on George Street and Sixth Avenue were approved.
The city has spent $22.4 million on the parkade project, which had an initial budget of $12.61 million, according to a report to council by city acting deputy manager Ian Wells. While Wells provided a breakdown of the different costs (see story), on Monday night council approved a motion by Coun. Brian Skakun asking for a more detailed breakdown of costs and a timeline of when they were approved.
"We've been kept in the dark. How the hell are we going to do our jobs providing oversight?" Skakun said. "It's shocking. We have literally tens of millions of dollars of overruns. My god, it's just embarrassing, your worship."
The project includes 289 underground parking stalls and 62 surface parking spaces, and acts as the foundation and parking structure for the Park House condominium project, in addition to providing public parking. The city partnered with A & T Projects Development Ltd. to develop the public parkade and private four-stage, 160-unit condo complex.
Coun. Cori Ramsay said she spent the weekend reviewing every report provided to city council about the parkade, and the timeline just doesn't add up.
The city administration was advised in July of 2018 by the developer that the project would cost closer to $20 million. City administration told the developer to go ahead anyway, Wells wrote in his report.
"In March 2019, we were asked to approve a $12 million project," Ramsay said. "That is almost an entire year after the city knew it would cost $20 million. In June of 2020 all of council received the capital project update. There was no mention of the George Street parkade. There was so many times that this could have been communicated to council. We have a transparency problem, and we have a communication problem."
Even if the $7.5 million increase did technically fall within former city manager Kathleen Soltis' authority to approve at the time, that should have been communicated to council, she said. The changes made by city council to require cost overruns of more than five per cent – or $100,000 – on a capital project should prevent this from happening again, Ramsay added.
"The person I'd really like to question doesn't work for the city anymore," Ramsay said. "This can never happen again. No one person should be approving $7.5 million – that is absurd."
The number of major capital projects coming in significantly over-budget is alarming, Coun. Terri McConnachie said. It's time the city conduct a review of all its project management procedures, she said, because something isn't working.
That review should involve an outside expert to assess the city's processes from beginning to end, she said.
"People elected us to provide oversight, and that didn't happen. None of us sitting around this table are experts in capital construction... but it seems like there isn't on staff either," McConnachie said. "We need to have a moratorium on any building projects until this consultation is back to council."
Acting city manager Walter Babicz said city staff have already begun looking into how that review process would work, and hiring external expertise would be part of that. The capital plan for 2021 has already been presented to the city's finance and audit committee, and includes projects already underway and a number of essential infrastructure projects that can't be delayed, he said.
"But be assured we have taken steps to reduce the number of capital projects" until the review is conducted, he said.
Coun. Kyle Sampson said council has already taken some steps to prevent something like this in the future, by shaking up the city's senior administration and changing the city manager's powers to authorize expenses without council's consent.
"This sucks. Frankly, it really ticks me off to see such a massive overrun on this project," Sampson said. "There is nothing we can do about what happened in the past, but we can change things going forward."
Coun. Garth Frizzell said ultimately it comes down to trust – council has to trust the information coming to them is accurate.
"It's pretty clear the buck stops here – and that's why it is so frustrating," he said. "There is a lot of work to be done here."
