Steve Kanellakos resigns as city manager, issues preemptive defence of city staff ahead of LRT inquiry report

Mayor Mark Sutcliffe said he would be bringing forward a motion at Wednesday’s council meeting to appoint the city’s chief financial officer Wendy Stephanson as acting city manager.

Publishing date:

Nov 29, 2022  •  17 hours ago  •  4 minute read

22 Comments

After over three decades in municipal public service, Steve Kanellakos resigned as Ottawa’s mayor. Photo by Errol Mcgihon/Postmedia Steve Kanellakos, a veteran city manager, resigned on Monday.

It’s an abrupt departure that follows decades of work in the municipal bureaucracy, and one that Kanellakos says he’s deemed appropriate ahead of the release of the findings of the provincial inquiry into Ottawa’s LRT system.

Sign up now to receive daily headlines from Ottawa Citizen, a division at Postmedia Network Inc.

Clicking on the sign up button will consent to receiving the Postmedia Network Inc newsletter. You can unsubscribe at any time by clicking the link at the bottom. Postmedia Network Inc. | 365 Bloor Street East, Toronto, Ontario, M4W 3L4 | 416-383-2300

In a letter to all city employees, released to the media, Kanellakos said he informed the mayor Monday that it would be his last day in the role he’s held since 2016. Kanellakos said that Kanellakos made his exit at his discretion.

“I’m sure there will be speculation about the reasons for my departure at this time. This is my decision and I am the one who made it. No one asked me to leave.”

Kanellakos’s departure comes two days before the first regular meeting of the new city council, as well as the release of the final report by the commission leading the inquiry, initiated by the province, into the first, problem-plagued phase of Ottawa’s LRT system.

“I’ve always deeply believed in leadership accountability. As the city manager, I am ultimately responsible for the organization’s performance. I have always deeply believed that my role is to have your backs and that it is my duty to accept ultimate responsibility for our performance,” Kanellakos wrote to staff, going on to note the LRT report’s upcoming release.

While he didn’t have advance knowledge of what it would find or recommend, Kanellakos said, “I do believe, based on the line of questioning and approach taken by the Commission, that the report will be critical of the City of Ottawa and City staff.

“Despite this, I know that City staff did their best under very difficult circumstances to ensure that the light rail system would meet all of our expectations.”

Kanellakos returned to Ottawa to take the city manager’s job in 2016, after roughly a year away in the same role at the City of Vaughan. Kanellakos served as deputy city manager from 2004 to 2015.  

In his departure letter, he stated his belief “that this is the time to do the right thing and allow the organization to find a new leader who can deal with implementing the recommendations from the inquiry unfettered from the long complex history of the project or the findings of the commission report.”

In a statement Monday, Mayor Mark Sutcliffe thanked Kanellakos for his service and said he respected his decision, which had been to submit his resignation earlier in the day, “effective immediately.”

Sutcliffe said he would be bringing forward a motion at Wednesday’s council meeting to appoint the city’s chief financial officer Wendy Stephanson as acting city manager. She Sutcliffe stated that he would continue to head the finance department throughout the 2023 budget process and had previously agreed to assume the additional role.

At least one city councillor is not happy with Kanellakos’s decision.

Jessica Bradley, elected last month to represent Gloucester-Southgate, tweeted that the city manager’s announcement was “shocking.

“Council is facing a number of challenges (OLRT inquiry, Bill 23, Budget) and this move is incredibly destabilizing for the organization,” said Bradley, who spent more than a decade as an executive assistant to her ward’s former councillor Diane Deans.

Kanellakos was one of the witnesses before the LRT Commission during the televised public hearings, which ran from mid-June through early July. This was part of the commission’s probe into the circumstances leading to the derailments or breakdowns along the Confederation Line. 

As city manager, Kanellakos’s authority extended to making decisions on the project, including negotiating, approving, executing, delivering, amending or extending the agreement. 

In his departure letter, Kanellakos reflected on the numerous crises staff have navigated over his seven years in the top municipal job as well as their “remarkable achievements.” 

“The people who work at the City of Ottawa are the reason I got up every day to come to work. For me it’s always been about serving our people so that they could provide the best possible service to our residents. I have an inexhaustible amount of respect for you all.

“Thank you for the support you have given me over so many years. I’m deeply grateful for that gift. After almost 38 years of service, it’s time for me to be a friend to me.

I’m going for a long walk….”

Kanellakos was hired by Council in February 2016 as the city manager. The term is five years and $319,000 per year. After a performance review, Council voted in November 2020 for Kanellakos to be extended until May 15, 2023.

Jim Watson, the former mayor, proposed the motion to extend the time. Watson stated that this would ensure stability for the municipality in the face of the pandemic. The motion also noted that the extension would allow the new council to have enough time to conduct a recruitment process in order to hire their own city managers. The extension included a clause that Kanellakos’s employment could be terminated earlier, in accordance with provisions in his contract.

Mayor Sutcliffe is now able to appoint city managers without the approval of the council, thanks to the strong mayor regime that was imposed by the provincial government. But he’s stated repeatedly that he would not use these powers.

A graduate of Carleton University, twice over, with bachelor’s and master’s degrees in public administration, Kanellakos got his start as director of the former city of Gloucester’s police service in 1989, according to his LinkedIn profile. He Then, in 1995, he was made director-general of Ottawa-Carleton Regional Police Service and in 2000, he was promoted to the position of general manager of all emergency and protective services for the City of Ottawa. He’s remained part of the city’s leadership, apart from his Vaughan sojourn, ever since. 

Bruce Deachman files

tblewett@postmedia.com

PIPSC calls proposals for public service workers working remotely ‘a slap in their faces’. Former citizen transit commissioner believes that the LRT inquiry report would be ‘cathartic.