Council agrees to settlement for downtown Winnipeg Police headquarters lawsuits

Winnipeg City Council has agreed to settle two lawsuits the city brought forward related to cost overruns with the downtown Winnipeg police station project.

Councillors voted 14 to two in favour of the deal on Thursday.

"I've said this is a victory for the people of Winnipeg. I truly believe that," Winnipeg Mayor Scott Gillingham told council.

The city will get a minimum of $21.5 million from the agreement, which could rise up to $28 million depending on when the money is paid to the city.

A report to council says this would cover both the “deficiencies” and “fraud” claims against all parties, minus a separate action against former city CAO Phil Sheegl and other defendants.

Previous court documents filed by the RCMP alleged the city was the victim of a multimillion-dollar fraud, as costs for the station ballooned. A 2018 briefing note from RCMP to prosecutors said officers were investigating financial crimes of more than $33 million.

Councillors Russ Wyatt and Matt Allard voted against the settlement offer. They tabled an unsuccessful motion to have an independent set of legal eyes brief council on the deal.

"I think in this case, we want Winnipeggers to know that we absolutely got the best advice that we could possibly get," Allard said. "I think that is not an unreasonable request to have a third party vet what is being offered here."

However, Gillingham said this settlement will avoid an additional $6.4 million in legal costs that will be required to proceed with the legal procedures. He said the city has already spent $4.1 million in legal costs.

"We just don't know how long the legal proceedings would take, how many more years, how many more dollars would be involved in this," he said, adding a settlement will avoid years of legal proceedings.

A motion was passed to get an update every two years until the funds are collected.