Last year, Medicine Hat awarded 123 contracts worth a total value of $49.9 million, and spent $8.9 million on inventory.--NEWS FILE PHOTO
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From spare vehicle parts and cable to expensive electrical transformers and heavy infrastructure equipment, city committee members were provided a report on the more than 459,000 items of inventory sitting in local warehouses.
On Thursday, members of the corporate services committee received the 2025 supply chain annual report from the city’s finance department, providing elected officials a summary of procurement, city storage and accounts payable.
The report is provided once a year to councillors to highlight the different procurement methods use, competitions for contacts, purchase order types and an overview of all inventory managed by the city.
“To simplify, we buy things, we pay for things and we store things for the city,” said Tibor Domian, manager of supply chain. “And there’s a general framework for procurement at the city.”
The city spent more than $164 million in total procurement spending last year, up from about $161 million in 2024.
More than 97 per cent, or $160 million, was spent in Canada, while the remaining three per cent was spent in the U.S or elsewhere.
“This was a hot topic last year, a lot of people asked about it, where does our money go,” said Domian, who explained more than $122 million of spending stays within the province, and approximately half of that is spent within the immediate region.
“That would be Dunmore, Redcliff, Desert Bloom, Cypress County,” says Domian.
In terms of inventory stores, which include parts for the city’s fleet, electric and gas distribution, municipal works and water and sewer, the city spent $8.9 million of products to keep operating.
This does not include approximately $11.4 million in inventory held at the power plant for electric generation, as that is managed separately from the city.
Domian says there are new challenges municipalities across the province face when it comes to ordering products necessary to maintain service levels.
“We used to be able to place an order and get it in like four to six weeks,” said Domian. “Now we are waiting like one or two years for things.”
This means when city staff place orders for needed equipment, products and parts, they need to use some guess work to estimate what will be needed in the future.
Rising costs of products are also impacting local warehouse shelves, says Domian, who compared the market over the past three years.
In 2023, the city was able to purchase approximately the same amount of product for $2 million less than in today’s current market.
“Things are getting expensive. We have less items on our shelves and the value of our inventory has gone up significantly.”
Last year, the city awarded 123 contracts worth a total value of $49.9 million, including $28.3 million spent within the region.
This compares to 2024 when the city spent $60.7 million on a total of 112 contacts awarded through open competitions.
Domian says staffers are working with 63 different suppliers to fill 32 categories of contracts available.
He also highlighted changes to the procurement bylaw in 2024, which significantly shortened the timeline staff have to sign contracts with developers and supplier,s from 15 days to just over two and a half.
This year the city plans to gather feedback from departments on its procurement process to make needed adjustments.
“Is it working for the departments? We would like to hear their feedback on our procurement processes and experience in general.”
The full report will be included in council’s consent agenda in March.
