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City auditor on LRT stage 2: lowest score, lowest cost bid won, but rules were followed
OTTAWA - The City of Ottawa’s Auditor General Ken Hughes has found the rules were followed and the process was fair in choosing the winning bid for Ottawa’s expansion of LRT stage 2.
Hughes says, “The process was open and transparent to the three proponents and no contentious issue was raised by the three proponents.”
But the auditor also found that city councillors were left in the dark about a key “discretion clause” in the bid process. It gave evaluators the power to essentially override bids that scored lower, and declare a winner based on other factors.
SNC Lavalin was chosen as the winning bid for Stage 2, despite the fact that it scored significantly lower than its two competitors, and did not meet the minimum 70% technical requirement for successful bidders.
“There is no doubt the lowest bidder won the contract, and there is also no doubt that (city staff) have no concerns that this proponent can deliver the project as envisioned by the city,” said Hughes.
Hughes also expressed surprise about the existence of the “discretion” clause and that councillors were not told about it. “I was surprised to learn of the discretionary clause but that information came to me when we did a preliminary investigation.”
Several councillors expressed frustration with the process and how the successful bidder was chosen. Somerset Ward Councillor Catherine McKenney said “I would not have, and would not today, vote for a proponent that didn’t meet the technical threshold of 70%.”
City Manager Steve Kanellakos says staff went by the book; even evaluating SNC’s bid a second time. “The discretion clause is there because there is no perfect process. These are subjective ratings. It’s not as black and white as people would like to think it is.”
Hughes put forwards several recommendations including making RFPs public in the future. “If the request for proposal was made public it could have eliminated so much headache and hand ringing.”