No direct tariff costs for City of Winnipeg yet, but full impact could be hard to detect: CFO

The City of Winnipeg might not always know when it's getting hit with costs related to U.S. tariffs, according to the city's chief financial officer. 

Tracy Graham told council's finance committee on Friday the city is tracking its purchases to determine which products might be subject to the tariffs imposed by U.S. President Donald Trump.

So far, the city has paid $0 on goods purchased directly from the U.S., Graham said. 

Invoices on products where the city is listed as the "importer of record" are set up to report any tariffs applied. Also, any purchases made through brokers, or by a construction company working for the city, are being tracked.

"Any new RFPs [requests for proposals], we've put the onus on the contractor, if there is going to be a cost escalation as a result of tariffs, that they demonstrate that they have … investigated alternative options for costs, and find the best cost solutions as it relates to inputs into the project," Graham said.

The U.S. has placed tariffs on a range of Canadian products, including 25 per cent tariffs on Canadian steel and aluminum, non-U.S. content of Canadian-made passenger vehicles and goods that aren't compliant with the Canada-U.S.-Mexico Agreement.

Canada has retaliated with tariffs on more than $60-billion worth of U.S. goods and on vehicles imported from the U.S. that are not CUSMA-compliant.

Accounting for tariffs becomes "muddier" when it applies to goods purchased from the U.S. that might not be subject to tariffs, but may use ingredients from other countries that are subject to U.S. tariffs, like China, Graham told the finance committee.

"There aren't a lot of those ripple-effect costs" on products coming into Canada, but they could take some time to show up here, she said.

The committee also received an update on a number of major construction projects at the meeting.

On the Pembina Highway overpass at Abinojii Mikanah, city engineering manager Brad Neirinck noted tariffs as a new risk to the project's budget and timeline, but said it's "too early to determine impacts or level of risk."

The city is having conversations with contractors working on the South Winnipeg Recreation Campus in Waverley West about potential impacts on heating, ventilation and air conditioning systems, many of which come from the U.S., Graham said

Finance committee chair Jeff Browaty told reporters measuring the effect of tariffs may not be "black and white."

"It's probably being rolled into the prices of different things that we're buying," the North Kildonan councillor said.

"It may not be blatantly obvious that there's a tariff involved in the purchase of something, because it was an input cost to making something. But I'm guessing there probably are tariffs out there already."

Graham, who recently attended a procurement meeting with the provincial government, said the province is working on finding local and Canadian suppliers for its products and services, but finding a clear definition of what qualifies as a Canadian company has been difficult.

"It's not just a holding company with a box address in Canada. So they want to make sure that they define that with some clarity," she said.

Some "opportunistic companies" have also claimed tariffs as an excuse to try to raise prices, Graham said.

"We have a pretty good network internally to make sure that we double-check those, and make sure that they prove their claims that those [increases] are really tied to tariffs."