LAVAL SNOW-REMOVAL CONTRACT RAISES QUESTIONS.
All six bidders got piece of action, with local equipment
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Contractors vying to supply snow-removal trucks to the city of Laval in 2009 were told what model of snowblower to use — and it happened to be manufactured by a Lavalbased company that donated money to then-mayor Gilles Vaillancourt’s party.
In all, six companies bid on Laval’s call for tenders in June 2009 to rent the city 20 to 25 snow-removal trucks.
What is suspicious, experts say, is that the six offered pre-cisely 25 vehicles among them, and al loffered nearly the same price. All six companies won a piece of the contract.
The winners included the snowblower manufacturer that won the lion’s share of the contract order.
But while the contract raises questions about the bidding process and collusion, it will never be examined by the Charbonneau Commission.
Municipal contracts concerning machinery rental don’t fit the mandate the Quebec government has given the Charbonneau commission, which is tasked only with examining public construction contracts.
The Laval contract suggests that questions can be raised about much more than municipal and provincial construction contracts.
The contract was for one year, with four optional oneyear renewals. Laval’s city executive committee just approved the third consecutive renewal on Sept. 26.
The contract, which calls for wheel loaders equipped with a specific model of motorized snowblower that’s made by Laval-based Gaston Contant Inc., or “an equivalent” to that model, has cost the city more than $1.23 million a year, municipal documents obtained by The Gazette reveal.
Gaston Contant offered 13 loaders and snowblowers, Carl Ladouceur Excavation Inc. offered three, Sig-Nature three, S. Boudrias Inc. two, Les Entreprises Jacluc Inc. two and Groupe Dubé et Associés Inc. two, the documents show.
Laval municipal employees operate the equipment.
The contract tender specifications gave not only the model and make, Contant C1016D or equivalent, but even the price.
The Laval contract specifications instructed the bidders to use the Quebec transportation department’s price manual, which sets prices that companies can charge the government to rent heavy machinery. The contract specifications even calculated the rates per hour for the loaders and snowblowers, respectively, telling the bidders the maximum overall price to charge to win the contract was $115.75 per hour.
That struck an elected official in a different municipality in the Montreal region as unusual, when asked whether other cities also indicate prices in their specifications.
“I’m surprised they’re telegraphing the price because then what’s the point in having a bid?” asked the official, who refused to allow his name be published, saying he didn’t want to be seen as interfering in another city’s matters.
A Transport Quebec spokeswoman, Caroline Larose, said on Friday she was unable to reach the necessary people at the department who produce the price manual to ex- plain the purpose of the price manual and how it’s supposed to be used.
“You have to work with the prices of the ministry of transport,” a company official at Les Entreprises Jacluc, who refused to identify himself on the phone, said when asked why the six firms that bid on the Laval rental contract offered nearly the same price.
“There are rental rates established by year. We can’t go higher than that.”
The company official said the firms that bid on the contract did no negotiating in advance, when asked how the six happened to offer 25 loaders and snowblowers between them.
“I only had two snow blowers, so I wasn’t going to bid for anything else,” he said. “They cost $300,000 to buy them, the machine and the blower. I can’t buy 10 a year. I can’t afford it.”
He added that he bought his snowblowers from Gaston Contant. The city’s contract documents show one was a brand new 2010 model, and the other 2009.
No one from Gaston Contant called back The Gazette.
Gaston Contant vicepresident Clément Contant has contributed to Vaillancourt’s Parti PRO des Lavallois every year since at least 2000, the party’s annual financial reports show.
A wheel loader with a motorized snow blower with the same power called for in the rental contract would cost $250,000 to $300,000 to buy new, several sources in the industry said.
As an example, Quebec City paid $105,207, including taxes, per snowblower when it went to tenders to buy 12 of them in 2011, a resolution of that city’s council shows. The city paid another $127,894, plus taxes, per wheel loader when it went to tenders to buy 12 of those the same year.
And Quebec City paid $109,994, including taxes, per snowblower and $134,589, plus taxes, per wheel loader when it went to tenders in 2010, the city’s resolutions show.
Meanwhile, Laval will have paid enough rent at the end of the five years of the contract and renewals to have bought each piece of equipment new. But it won’t own it.
Laval has been paying $50,000 to $54,000 a year to rent each combination of wheel loader and snowblower.
The price has crept up from an initial $50,000 in the first year. In the latest renewal, the price is up to about $54,000 per vehicle. The year before going to tender to rent the 20 to 25 loaders and snowblowers, Laval issued a call for tenders in 2008 to rent the same Gaston Contantmodelof snowblower on a 10-year lease with option to buy. The tender call elicited one bid, from R.P.M. Tech Inc.
However, Laval’s executive committee suddenly cancelled the contract tender.
When the city came back the following year with the call to rent 20 to 25 loaders and snowblowers instead, the contract specifications contained no option to buy.
Meanwhile, the contract specifications stipulated the motorized snowblowers couldn’t be older than 2005, even though experts The Gazette contacted said the usual life of a snowblower is 20 years. The contract specifications required no specific make or model of wheel loader, and the vehicles could have been manufactured as far back as 1995.
The one-year contract is a turnoff for any contractor, two experts in the industry who spoke on condition of anonymity said. A snowblower, like a car, depreciates heavily after just one year. So a oneyear deal is risky for anyone because there’s no guarantee it will be renewed. The Gazette spoke to one competitor who said he refused to bid on the contract because he considered the one-year deal was too big a risk.
Contract tenders that contain requirements that can only be met by certain contractors is a warning sign for collusion, procurement experts say.
“Overspecifying is a recognized symptom, red flag, indicator of a flawed tender. Period,” Courtenay Thompson, a procurement consultant and forensic accountant in Dallas, said. Thompson teaches a course on construction fraud.
Thompson added that city officials should also have wondered how six firms bid the precise number of pieces of equipment spelled out in the specifications.
“What are the chances?” he asked. “Unless it’s serendipity.”
Thompson pointed to the fraud indicators listed in what is considered a bible on procurement, the United States Department of Defense’s Handbook on Indicators of Fraud in DOD Procurement.
The handbook, for example, warns to be wary of an “industry price list” or “price agreement” to which contractors refer in formulating their bids.
No one from Carl Ladouceur Excavation and Sig-Nature returned The Gazette’s calls.
At S. Boudrias, a company official said only the owner can answer questions, but he’s away until Nov. 19. “He’s responsible for bidding,” the official said. “No one else is aware of that.”
A receptionist at Groupe Dubé et Associés said she wouldn’t take a message “because no one will call you back.”
Gilles Vaillancour t steadfastly rose before every Laval council meeting in his two decades as mayor and recited a 27-word prayer asking the Lord to provide councillors with his grace and the knowledge to run the city well.
Lord only knows what prayers he’s been saying these days.
After more than two weeks in hiding, officially resting under doctor’s orders, and with the police nipping at his heels, the seemingly untouchable Vaillancourt emerged Friday to say that after almost four decades in municipal politics, he was stepping down.
“I am addressing you today for the last time as mayor of Laval,” Vaillancourt said, speaking in a dimly lit council chamber and aiming his remarks squarely at citizens after ducking in a side entrance. “Against the advice of my doctor, I am here today.”
And with that Vaillancourt did something uncharacteristic in his formidable political career. He conceded.
Vaillancourt’s 23-year mayoralty rule has been described only half-jokingly by some over the years as a benevolent dictatorship. It has weathered the controversial money-losing Cosmodome debacle, the collapse of two overpasses, and an independent report in the mid-’90s that found many of the city’s financial practices and dealings since 1987 were highly questionable.
But he and a slate from his Parti du ralliement officiel (PRO) have been returned to office over and over with substantial majorities — sometimes without even a single member of the opposition elected to council.
Vaillancourt succeeded in extending the métro to Laval and building the Olivier-Charbonneau Bridge to join Laval to the east end of the island. The Université de Montréal built a satellite campus. He kept taxes low and had the ability to extract large sums of money from upper levels of government, since four of the five ridings in Laval swing between the Parti Québecois and the Liberals.
Vaillancourt, who comes from a furniture retail family, got his start on city council in 1973.
After serving as coun- cillor for 16 years, Vaillancourt was acclaimed mayor in 1989 when Claude Lefebvre decided to leave for health reasons shortly after council approved a $60,000 severance pay for mayors who serve at least two years of their term.
His governing style was a mix of charm and fear.
Robert Bordeleau, a failed mayoral candidate, described how Laval residents who showed up at city hall to complain would be grilled by the deep-voiced Vaillancourt about why they’d been talking to the opposition or receive a phone call at home.
He quickly earned the reputation as a politician who brushed off reporters’ questions, silenced critics with lawsuits, rezoned agricultural land for development and stubbornly refused to take part in debates. But he also got things done.
Some gave up even trying to unseat him, saying he had the monopoly on funding and support from the business community. Others staged unusual stunts to force his hand — all to no avail.
In 1997, Marie-Josée Bonin of the Option Laval party, camped overnight in a trailer outside city hall, vowing to stay until Vaillancourt agreed to a debate. The administration countered with a bullying threat: either the trailer goes or Option Laval gets fined up to $2,000 for illegal parking.
In 2005, resident Rick Blatter staged a 44-day hunger strike to try to force the mayor to resign.
In 1998, and after racking up more than $42,000 in legal bills, the city decided to drop a $650,000 libel suit against former mayoral candidate and Option Laval Leader Jean Rizzuto. Independent councillor Maurice Clermont, who, like Rizzuto, was being sued for denouncing the city for approving a 20-year, $8.5-million deal to lease a garage, settled out of court in 1996.
A few years later, in June, 2000 a j udge threw out a $750,000 libel suit against Laval dissident party leader Daniel Lefebvre, saying the dispute should have been worked out in the political sphere, not in the courts. The suit followed comments Lefebvre made regarding city councillor André Boileau’s dealings with an engineering firm that received frequent contracts from Laval.
Vaillancourt’s woes with allegations of corruption seem to have first surfaced in the early 1990s, over the administration’s handling of Laval’s $30-million space-camp project, the Cosmodome on Highway 15.
A confidential internal memo from Spar Aerospace Ltd. official Diane Chenevert to Aerospace president William Fitzgerald said the space camp’s board of directors decided to move the installation to Montreal in the wake of irregularities and problems with the city of Laval.
“We also discovered that many of the architectural and construction contracts were given to Laval firms with the sole purpose of inflating the cost and injecting money in the mayor’s electoral-funding bank.”
She accused Laval of refusing to turn over the deed to the land on which the camp is to be built unless it gained control of the camp’s board of directors. “Space Camp Canada cannot be manipulated into using public funds to help Laval’s mayor (in his) electoral campaign,” she wrote.
Vaillancourt denied the allegation and Spar Aerospace officials said Chenevert’s criticisms were unfounded. Chenevert, who now runs a respite home for parents with handicapped children, didn’t return several calls made by The Gazette.
The space camp, whose price tag went from $28.4 million to $32.7 million, opened in 1994 in Laval but turned out to be a money-losing venture. It was rescued from the brink of bankruptcy after federal and provincial governments, as well as private investors, stepped in with $11.9 million. If it shut down, Laval stood to lose $13 million, thanks to a loan guarantee Vaillancourt’s administration provided to the Cosmodome’s main creditor, the National Bank of Canada, to help build the facility. Laval assumed ownership of the Cosmodome under the restructuring and agreed to pay off the National Bank loan.
In April, 1995, at the request of Vaillancourt and some Laval MNA’s, then municipal affairs minister Guy Chevrette named former Joliette mayor Jacques Martin to look into allegations of mismanagement of public funds and abuse of power at Laval city hall. Martin’s report concluded that while the city broke no laws, many of its financial practices and dealings since 1987 were highly questionable.
Martin wrote that several questions were left unanswered concerning modifications to construction and engineering contracts awarded by the city, as well as its decision to hire a Montreal investigations firm to carry out electronic surveillance.
But rather than losing his hold on power in the face of all this, Vaillancourt only consolidated his authority. Since 2001, Vaillancourt’s PRO party has held every seat on council.