City council tightens grip on capital project spending

Starting on Jan. 1, city council will have greater control over cost overruns on the city's capital projects.

Currently the city manager has the authority to make cumulative budget amendments in a calendar year of up to five per cent of the city's total operating budget – roughly $7.5 million for the 2020 budget. Once changes approved by city council come into effect in 2021, the city manager will require city council to authorize any capital project that goes more than five per cent, or more than $100,000, over budget.

article continues below

"At the end of the day, it gives council more oversight over the projects that are ongoing in our city... and that is a good thing," Mayor Lyn Hall said.

City director of finance Kris Dalio said the new policy is in line with what many other B.C. municipalities do. Kamloops, Kelowna, Nanaimo, New Westminster and Saanich all allow their city managers to approve cost overruns, with limits ranging between $100,000 and $200,000, according to a report presented to council on Monday.

The inclusion of a maximum percentage was an attempt to "scale the right amount to the size of the projects," Dalio said.

Going up to $100,000 over budget on a $50,000 project would trigger a report to city council, while going up to $100,000 over budget on a $2 million project would not.

Introducing the changes starting next year would prevent acting city manager Walter Babicz from having to retroactively seek council approval for projects that were done this year, Dalio said.

"This is a response to (the desire for) having more reporting back to city council – but not too much," Coun. Garth Frizzell said. "Projects are subject to a wide variety of pressures. With these changes, we'll see it when we need to see it."

The issue of capital project cost overruns came to a head, earlier this year. 

In June, city council was told the new firehall being built on Massey Drive was $2 million over budget. Then in September, council was informed the underground parkade being built at George Street and Sixth Avenue was $5.3 million over budget.

"I believe what was in place wasn't working," Coun. Kyle Sampson said. "(But) it is important that staff have some wiggle room. It's not the job of council to micromanager projects."

Council also approved a change to allow unspent funds allocated to projects that have already started to be carried forward. Unspent funds for projects which haven't started yet will be brought to the city's finance and audit committee for review.

Coun. Cori Ramsay said she was pleased by the change, as it will keep members of city council in the loop on the status of those projects.

Read Related Topics


NOTE: To post a comment you must have an account with at least one of the following services: Disqus, Facebook, Twitter, Google+ You may then login using your account credentials for that service. If you do not already have an account you may register a new profile with Disqus by first clicking the "Post as" button and then the link: "Don't have one? Register a new profile".

The Prince George Citizen welcomes your opinions and comments. We do not allow personal attacks, offensive language or unsubstantiated allegations. We reserve the right to edit comments for length, style, legality and taste and reproduce them in print, electronic or otherwise. Comments that contain external links will not be permitted. For further information, please contact the editor or publisher, or see our Terms and Conditions.

comments powered by Disqus

Should the mayor resign? POLL

Should Mayor Lyn Hall resign due to the $22 million cost overrun to build the George Street parkade?

or  view results

Popular Citizen

Lowest Gas Prices in Prince George
Prince George Gas Prices provided by