Local councillors must send message on open tendering

The current system causes publicly funded projects to cost more

As the Oct. 22 municipal election rapidly approaches, a dominant issue for the local business sector is the newly elected Ford administration’s response to the ongoing issue of municipal tendering.

The current system forces school boards and municipalities to select only contractors with agreements with specific unions. This has been demonstrated to cost more for publicly funded projects and less choice of qualified contractors. The net result is less public infrastructure is getting done and the costs are higher — the definition of a lose/lose scenario.

For many years, our chamber and business organizations across the province have been asking Queen’s Park to change the Ontario Labour Relations Act to make clear that municipalities and school boards are not to be considered to be construction employers under the act.

Under the current legislation, many qualified Waterloo Region companies are not eligible to bid on major infrastructure projects based solely on the condition that they are not affiliated with one or more designated unions. It is now estimated that 70 per cent of the provincial construction industry is not able to compete for work on publicly owned and funded projects. That must change.

Taxpayers and ratepayers deserve to have their tax dollars spent wisely, prudently and to get as much bang for the buck as possible.

The economic and budgetary implications for all levels of government as a result of restricted tendering practices are substantial. Research indicates that open tendering can cut costs by 20 to 25 per cent. In the Region of Waterloo, where tendering has been closed since 2014, the number of bids has dropped by 50 per cent. The cumulative impact of restricted tendering is increased property taxes and inflated project costs which divert municipal expenditures away from other vital social and community services.

At the recent annual general meeting of the Canadian Chamber of Commerce, a resolution was passed directing the federal government to institute a policy that all federal dollars going toward public infrastructure projects must allow open tendering.

The experience of Waterloo Region was prominently highlighted as an example of closed tendering resulting in fewer bids and higher prices.

Our chamber, along with the Cambridge Chamber of Commerce, has requested a meeting with Premier Ford’s government to further discuss municipal tendering and financial sustainability for cities and businesses. It is our strong hope that new legislation will be tabled imminently to meet the Ford government’s campaign commitments on many urgent matters, and that our request is that this issue be included this fall.

At chamber forums for regional council and mayoral candidates (who will also serve on regional council) we have been asking if candidates support a tendering system that is open and fair to all qualified bidders.

It is important that if the matter is not resolved before the Oct. 22 election that municipalities and businesses across Ontario maintain pressure on the province to implement the necessary legislative changes for fiscal sustainability and allowing all qualified companies to participate on the bidding process for major infrastructure projects. The time for action is now.