A motion that would allow Prince Albert’s city manager to approve limited city project cost overruns has barely passed through executive committee and could face an even rougher ride at the next regular council meeting.
On Monday, city councillors voted by a narrow 4-3 margin to approve a project budget contingencies plan. The plan would allow the city manager to approve up to $100,000 per project in contingency spending without heading back to council to approval. The motion also allows the city’s eight department directors to approve up to $50,000 per project in spending, as well as up to $25,000 for senior managers and up to $10,000 for regular managers.
The motion requires one more hearing at a regular city council meeting to receive formal approval.
City manager Jim Toye said the move would help avoid unnecessary delays when unforeseen problems cause a project to go over budget. The current system requires all departments to bring these requests before council, no matter how small.
Toye added that city administrators were more than capable making smaller decisions, and would still come back to council for projects significantly over budget.
“We’re not here to have a card game or gamble with the city’s tax dollars,” he said. “Every time we have a project, we question the contractor (and) the managers I have on site to make sure we’re getting the best bang for our buck.”
Toye added that he worried their was a misconception that too many city projects were over budget. In the past year, city council has approved $320,000 in additional spending due to a variety of changes, delays and unforeseen circumstances. However, Toye maintained that the number of projects running over budget was quite small when compared to the total number of annual projects completed.
“If we get that tender and that project, we do our best to make sure it’s on budget, our very, very best,” he said. “If we’re not on, then I get to stand before city council and in front of all the taxpayers in this city and say, ‘we did not hit the mark.’”
Toye’s words, and a presentation from capital projects manager Wes Hicks, received a mixed reception from city council. Ward 6 Coun. Blake Edwards was the strongest supporter of the motion, telling those assembled that many of the contractors he talked to were surprised the city had no budget contingency plans in place.
“Most of them said, ‘there’s always going to be unforeseen conditions on every job,’” Edwards explained. “All of them said that (and) that opened my eyes a little bit.”
However, Mayor Greg Dionne proved to be less enthusiastic. Dionne objected to any idea that city council did not trust administrators, but remained skeptical of contractors. In particular, he was upset with cost overruns in the project to repair the riverbanks in Little Red River Park.
Dionne voted against the motion, saying he wanted city council to have the final say.
“If you don’t think that contractors play little games trying to get at those contingency funds, then you don’t live in the real world,” he said. “We’re the keeper of the taxpayer’s money, so when we overspend that kind of money, I think we have the right to ask questions.”
According to a report presented by Hicks at Monday’s executive committee meeting, both Moose Jaw and Regina allow administration full authority to sign off on contingency expenses that amount to 10 per cent on any project. The City of Saskatoon has a more complicated formula where administrators have full authority unless a project exceeds its budget by 25 per cent.
Hicks’ report adds that due to the 11 day pre-council deadline for report submissions, projects can be delayed for more than 32 days for expenses as small as $1,000.
Council approved Monday’s motion by one vote margin, with two councillors absent for the session due to previous commitments.
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