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Councillors in dark over ‘recycled’ project funding
(Hamilton Spectator, Matthew Van Dongen, Dec 6 2013)

City bureaucrats are redirecting millions of dollars approved for certain projects and spending them elsewhere with little oversight, say councillors.

Next year's proposed $285-million capital budget includes $20 million in funds "reallocated" from completed, delayed or abandoned capital projects approved by council in the past.

Too often, councillors don't know where that "recycled" cash comes from — or what previously approved projects died to make it available, said Councillor Chad Collins at Friday's budget meeting.

He pointed to $1.2-million staff-proposed spending on traffic signal upgrades in 2014 — money that was originally approved by council for road repaving in 2012.

"When these sort of transfers are happening — and we're not aware of it — it's particularly frustrating given what we're constantly being told about the lack of resources for roads," Collins said, noting the city roads and bridges repair deficit of close to $200 million.

"If we think we're funding one thing, and you move that money around and we're not aware of it, I think we need to see some policies around that," said Councillor Terry Whitehead.

Acting finance general manager Mike Zegarac said in an interview about $4 million of the reallocated funding is bonus cash leftover from cheaper-than-expected projects. In other some cases, like $500,000 worth of delayed sidewalk work, the money will just be spent on the same work next year.
Millions more in recycled cash, however, come from reprioritized, delayed or abandoned project budgets.

Zegarac said project reallocations of $250,000 or more come back to council for approval through periodic "capital closing" reports or the budget process.
But he conceded the details of the transfers — where the money started, which reserve it was parked in, and where it ends up — are not always clearly shown.

After Friday's meeting, Zegarac said staff will come back with a specific reallocations policy designed to keep councillors in the loop on recycled project cash.