Inspector general to keep eye on $ 50M in contracts
About $ 50- million worth of roadwork contracts in Montreal this year are in the safe hands of the city’s “pit bull,” the inspector general, the administration of Mayor Denis Coderre says.
Inspector general Denis Gallant and his staff have agreed to monitor the awarding and performance of 11 road repaving contracts under a $ 50- million envelope of the 2015 capital- works program as an added safety measure to prevent collusion and corruption, Lionel Perez, the executive committee member responsible for infrastructure and governance, told the Montreal Gazette on Tuesday.
“Because it’s 11 contracts that are being launched in a relatively short period of time, and for a large amount, we decided to mandate the inspector general to do what’s called contract monitoring,” Perez said.
“They’re going to be carrying out some monitoring of the program, of the bidding process, of the actual realization of the work, to minimize the potential risk of collusion. We’re also sending a signal to the industry that this is an issue that is always top- of- mind for us.”
Contract- monitoring systems exist for government contracts in the U. S. The contract monitoring in those places covers the pre- and post- contract periods as well as the performance of the contract. The pre- contract period includes the drafting of the contract specifications and the bidding process, while the post- contract period includes ensuring the contractor performed the work satisfactorily and that public funds were spent appropriately.
During the contract performance phase, the agency or office that is tasked to do contract monitoring uses various means to evaluate the contractor’s work, such as on- site checks.
The Coderre administration, through city manager Alain Marcoux, broached the idea with the inspector general’s office in January, Perez said. Marcoux made the formal request to Gallant in early February, he added.
The first three of the 11 roadwork contracts went to tender this month, Perez said, and the inspector- general’s office is on top of them. The inspector- general’s office is assessing market prices to compare the bids once they come in and is making sure that potential bidders are aware that the inspector general is there as a watchdog, he added.
“So if ever there was an inclination to try and have any collusion, they know that they have the pit bull that is the inspector general on their case,” Perez said.
The inspector general’s office, which was set up by the Coderre administration after the November 2013 municipal election, is independent and doesn’t need the administration’s blessing to initiate activities, Perez noted. However, the city manager in this case requested the inspector general carry out contract- monitoring given the size and the number of contracts involved in the $ 50- million roadwork program, Perez said.
The program is earmarked for scraping and resurfacing of mainly arterial roads in the 19 boroughs. Only roads that won’t require underground infrastructure work in the next seven years are eligible for the work, which is what distinguishes the program from the city’s regular roadwork program.
“I think it shows our preoccupation and our constant desire to ensure that we have the most stringent requirements and standards of integrity with respect to procurement for infrastructure contracts,” he said.
Yet despite the Coderre administration’s concern for probity in the procurement process, it continued to do business last year with asphalt- supply firms that have been convicted of illegal acts or have admitted to engaging in collusion.
As the Montreal Gazette reported last week, the city could have invoked its contract- management policy to cancel a $ 3.7- million asphalt- supply contract it awarded in March 2014 to the firm DJL Construction after the city placed the company on its contractor exclusion list a few weeks later. However, it didn’t revoke DJL’s contract, and the opposition Projet Montréal party is now calling on Gallant’s office to investigate.
As well, the city awarded another of last year’s asphalt- supply contracts t o Simard- Beaudry Construction Inc., which pleaded guilty to tax evasion in 2010. It was at the time one of two firms belonging to businessman Tony Accurso to plead guilty to charges brought by Revenue Canada.
Perez said he learned from the civil service in January that the former city executive committee made a decision in August or September 2013 not to apply the contract- revocation clause of the contract- management policy in situations where a firm risks losing a contract it obtained before being debarred.
That’s why DJL’s contract wasn’t cancelled last year, Perez said he was told.
As for Simard- Beaudry Construction, Perez said the city’s lawyers have explained to him that a company gets excluded from city contracts only if it’s convicted or has admitted to past collusion or fraud specifically on a call for tenders or a contract. That’s how the contract- management policy is worded, he added.
“It’s not for tax- related fraud,” Perez said.
Meanwhile, both cases are no longer a concern, he added.
The city removed DJL from its exclusion list two weeks ago because, on Jan. 30, the Autorité des marchés financiers ( AMF) authorized DJL to bid on public contracts in Quebec.
And Simard- Beaudry Construc- tion is not currently eligible to bid on city contracts because a provincial decree passed in September requires companies wanting to bid on any type of Montreal construction- related contract over $ 100,000 to have AMF authorization. Before that, asphalt supply wasn’t covered.
Simard- Beaudry Construction doesn’t have AMF authorization, so it can’t bid on the city ’s latest call for tenders for asphalt supply, which is set to close on Monday, Perez said. He added that the administration had an option to renew last year’s asphalt- supply contracts for another year, but decided against it.