A top bureaucrat and controversial figure at Winnipeg’s city hall has quit.

The City of Winnipeg announced Chief Administrative Officer Phil Sheegl resigned on Thursday.

Earlier this year, one city councillor called for Sheegl’s resignation after a number of controversial deals were made under his purview, including the firing of the city's fire chief and a highly-scrutinized business deal with Mayor Sam Katz.

'Phil Sheegl has resigned. Here's hoping the changes to come will be an opportunity to rebuild the public trust.'- Tweet from City Coun. Jenny Gerbasi

Sheegl's resignation comes just days before an audit of a fire-hall land swap deal was set to be released. The external review was ordered after city council killed a deal that would have seen Shindico, a local developer, exchange land on Taylor Avenue for three other city-owned properties.

The swap was arranged between former fire chief Reid Douglas and Shindico and would have seen land on Taylor Avenue swapped for two fire stations that had been declared surplus by the city as well as a parcel of land on Mulvey Avenue.

When city council found out about the deal, they killed it and arranged for an external audit, to make sure the city was getting the best value for the properties Douglas had agreed to trade.

A fire station has already been built on the Taylor Avenue parcel, and the city is now working on a deal to purchase the land.

'There will be all sorts of theories, and I have no doubt in my mind "falling on the sword" theory is certainly going to be out there'- Mayor Sam Katz on whether Sheegl quit because he was becoming a political liability

Douglas was then fired in late September, but city officials have remained mum about why. 

Shortly after his dismissal, Coun. Ross Eadie called for the firing of Sheegl, saying a number of controversies surrounding the CAO have lead to a lack of trust. 

Eadie cited concerns over Douglas' firing and Sheegl's past business dealings with Mayor Sam Katz. In 2012, Katz bought an Arizona-based business from Sheegl for $1.

Eadie said he planned to introduce a formal motion this month to have Sheegl fired, but Sheegl beat him to it by resigning.

On Thursday, Eadie echoed his concerns, saying the $1 business swap between Katz and Sheegl was highly concerning.

"They are that tight? That's — it's just untenable. It just can't work," he said. "[It] might work in the private sector, but it doesn't work in a public entity."

Mayor has no idea why friend Sheegl quit

"He submitted his resignation and all members unanimously accepted it on EPC," said Katz, who says he does not to know why Sheegl left. “I’ve dealt with this on occasions before. It’s not the first one."

Katz speculated Sheegl's resignation had to do with "pressures of the job."

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In 2012, Mayor Sam Katz bought an Arizona-based business from CAO Phil Sheegl for $1 in a highly scrutinized deal.

Katz and Sheegl are known to be friends outside of office. When pressed on why he didn’t know the reason for Sheegl's resignation, Katz said, “I don’t mix apples with oranges. This is strictly business and that’s the end of that.”

"There will be all sorts of theories, and I have no doubt in my mind 'falling on the sword' theory is certainly going to be out there," Katz added, referring to Sheegl becoming a political liability.

Katz also denied knowing if the resignation was tied to the impending release of the fire hall audit on Monday.

“I don’t believe that there is any [connection] but, you know what? Well, I guess, Monday we’ll all know for sure,” said Katz.

City councillors react

City Coun. Paula Havixbeck is worried Sheegl's departure will make it difficult to get answers after the audit is released on Monday.

"One of the biggest reasons I spoke out about the fire chief being let go so coincidentally on the heels of this report was for that very fact," said Havixbeck. "We need people here to answer during that council meeting, during that EPC meeting. There's going to be a lot of questions."

She said it likely foreshadows a negative audit report.

"I conclude that this audit must be very bad if a key employee can just depart right on the heels of this coming forward next week," she said. "I think that makes a bold statement how bad the audit really is."

As for the controversy swirling around Sheegl, Havixbeck would only say, "There was a lot of questionable behaviour. I will say that."

City Coun. Jenny Gerbasi seemed to concur when she tweeted shortly after the news broke, "CAO Phil Sheegl has resigned. Here's hoping the changes to come will be an opportunity to rebuild the public trust."

Sheegl offered no public insight into why he left on Thursday. Instead, he sent a resignation letter to all city staff, thanking the mayor and city councillors for his "meaningful and productive" time at city hall.

Controversy surrounds Sheegl

Since his hiring, Sheegl has been a controversial figure at Winnipeg’s city hall.

The Canadian Centre for Policy Alternatives raised questions about the man when he was first hired by the city to head up the department of planning property and development in 2008.

The centre published an article cautioning city officials about his appointment, saying Sheegl’s background in land development was problematic as developers’ interests versus the interests of the public could be at odds.

“It is hard to believe that the city could not attract someone with a more suitable background than real estate development,” the report read.

On Thursday, Lynn Fernandez, a spokesperson for the centre, said, “We’ve had questions from the beginning, and we have many questions remaining.”

Those concerns were echoed by citizens in a 2012 Ekos Research poll commissioned by CBC. The poll found 61 per cent of people polled thought Sheegl had "definitely" or "probably" been involved in conflicts of interest in the past.

When it was released, Sheegl said he still felt he had the confidence of city hall, regardless of what others thought of him.

Going forward, Fernandez added the centre will be very interested in the results of the fire hall audit expected to be released on Monday.

Timeline of Phil Sheegl's history with the city

Read Phil Sheegl's full letter to city staff

To all City staff:

This is to advise that I am resigning as the CAO of the City of Winnipeg after nearly six years of public service.

Though it has been a trying year from many perspectives and for many public servants, especially those on the senior management team, I leave with a sense of thankfulness for their tireless efforts in serving the citizens of Winnipeg capably, conscientiously, and well.  Together, we have accomplished a great deal for our City – in improving public planning, infrastructure, amenities, services, and safety – and are collectively proud of:

·         Completing the Disraeli Bridges Project, the largest in Winnipeg history, on-time and on-budget;

·         Completing the Chief Peguis Trail extension, on-budget and one year ahead of schedule;

·         Nearing completion of the consolidated new HQ for the Winnipeg Police Service;

·         Completion of the first stage of the Southwest Transitway,  and continued progress on Rapid and Active Transportation networks;

·         Partnering in a revitalized Sports, Hospitality and Entertainment District downtown;

·         Provision of enhanced recreational opportunities for inner-city children and youth; and,

·         Consultation and preparation of OurWinnipeg, the City’s long-term plan for the future.

Despite so much negativity regarding the construction of four new fire paramedic stations, they, too, are an important accomplishment and a vital component of modern emergency services for Winnipeg families, especially in growing neighbourhoods like Sage Creek, where response times have been drastically improved.  They are equally important projects in communities where antiquated stations were no longer suitable places for our firefighters to live and work.

Throughout my time as CAO, my purpose and focus has always been to approach every task in a constructive, positive way, and work to ensure the success of all our civic projects. I am glad to have had the opportunity to see so many important projects realized.

To my family, friends and colleagues who have supported me throughout these years of being in the public arena and the focus of endless media attention, I thank them for their constant encouragement.

As for my time at the City of Winnipeg, I would like to thank the Mayor and so many Councillors and staff who made my time both meaningful and productive. Winnipeg is and always has been my home, and I wish everyone the best, moving forward.

Sincerely,

Phil Sheegl