Sturgeon County is missing out on about $356,000 in savings due in part to its scattered approach to procurement, a new study suggests.
County council received an operational efficiency study of administration last May 14 during a closed session. A redacted version of the study was released this week.
Council hired the accounting firm MNP last summer to conduct this $150,000 study.
The study involved reviews of county procedures and interviews with county employees. Those interviews were done under the condition of anonymity, and many parts of the study have been blanked out to protect the identity of those employees, said county CAO Reegan McCullough.
The study found that the county was lean when it came to spending and staffing compared to St. Albert and Fort Saskatchewan as well as the counties of Parkland, Leduc, Rocky View, Grande Prairie and Red Deer. It spent about $262 less in capital and $587 less in operational dollars per person than these neighbours and had 101 fewer full-time employees. It also charged about $16 less per person in taxes.
The study didn’t find many huge problems in its review, but did note that many of the county’s procedures weren’t written down, which was a potential risk if the people who knew them left before passing them on.
It also flagged the county’s procurement process as a problem. The county bought some $49.3 million in goods and services last year on a “very decentralized and siloed basis” and without oversight from a trained procurement person or department – most communities MNP studied had about three dedicated procurement people. This uncoordinated approach put the county at risk of not getting the best bang for its buck.
The study surveyed county staff and estimated they spent about eight full-time-jobs-worth of time on purchasing decisions a year, with some staffers spending six hours a day on them. Many staffers did not feel they had the skills needed to find the best deals, and would hit up folks in Engineering for advice – much to the discomfort of Engineering.
The county agrees it needs to create a centralized procurement office or position and is now studying how best to do that, McCullough said.
The study compared Sturgeon to three other communities and found that the county’s transportation department spent about 44 per cent more per kilometre of road and had around 82 per cent more employees per kilometre on average than the other three (about $9,181 and 0.0305 people per kilometre versus $6,359 and 0.0168). It recommended more study to figure out why this was the case and cautioned that there could be many reasons for these differences. One of them might be the fact that the county has a lot of gravel roads that need a lot of expensive repairs, McCullough said.
Mayor Alanna Hnatiw said in an email that the review’s findings on transportation costs were “concerning,” but that she was confident the county’s new municipal services manager (Scott MacDougall) was on top of them.
“We do not want to underfund roads,” she added, which is why council voted 4-3 (councillors Neal Comeau, Susan Evans, Karen Shaw opposed) in a special May 17 council meeting to borrow $6 million to invest in roads with plans to pay the loan back when cash from the Sturgeon Refinery arrives.
The study makes 48 recommendations that would save the county a net $356,000 next year if implemented, much of which would come from procurement. McCullough said administration is now working on 20 of those recommendations, with the rest dependent on budget decisions and other initiatives.
The redacted study is available at bit.ly/2MeZJuC.
