An examination of the outdoor shelter initiative in Hamilton revealed that the project’s sense of urgency took precedence over thorough due diligence and effective governance practices. Hamilton’s Office of the Auditor General (OAG) highlighted issues such as a lack of accountability, governance structures, and cost oversight, as well as a failure to manage risks adequately. Insufficient contracts and oversight, combined with a lack of experience, created an environment where vendors could exploit the project, leading to financial and operational repercussions for the city and its taxpayers, according to the OAG.
The audit report, along with 11 recommendations for city managers, was released ahead of a Jan. 15 Audit, Finance, and Administration Committee meeting. The report, prepared by the OAG, urges the city manager to respond to the recommendations and update the audit committee by July on the actions taken in response. The decision to accept or reject this recommendation rests with the 10 city councillors on the committee.
In response to the audit and recommendations, the city stated that it would review the report with the council and discuss potential areas for improvement through the appropriate process. The city defended the project, emphasizing that it was a complex endeavor aimed at addressing the pressing homelessness and housing crisis, with decisions made in good faith based on available information and circumstances.
The outdoor shelter project in Hamilton, established on Barton Street W., was designed to provide temporary housing for up to 80 individuals who could not be accommodated in traditional emergency shelters. The site, managed by Good Shepherd, features prefabricated cabins and communal buildings, representing a unique approach in Hamilton but following trends seen in other communities like Kitchener-Waterloo and Kingston.
The audit was initiated in 2025 following complaints and reports of issues related to the project. The audit process involved a comprehensive review of various sources of information, including council reports, contracts, communication records, and interviews with staff. The OAG identified several key themes from the findings, highlighting the importance of robust planning, due diligence, and project team experience aligned with the project’s nature.
Regarding the procurement of shelter units, the audit revealed shortcomings in vendor selection processes and highlighted the lack of market research and due diligence. The audit criticized the city for engaging a supplier without a proven track record in temporary shelters and for making significant payments without physically inspecting the units.
The audit made 11 recommendations to enhance future project management, focusing on areas such as procurement practices, contract management, financial control, and risk management. The OAG emphasized the need for improved oversight, structured contracts, and early involvement of relevant departments in construction projects. These recommendations aim to prevent similar issues in future initiatives and ensure better governance and accountability in the city’s projects.