Purchasing department slammed for dual battery contracts

Montreal’s inspector-general department released a report Monday blasting the city’s purchasing department for botching a $1.1-million contract to buy electric batteries.

In his report, Denis Gallant recommends the contract be cancelled outright because the circumstances surrounding the call for tenders for the contract “go completely against the integrity of the contract-awarding process and is in contrast to the behaviour that one would expect from a municipality.”

At issue is a call for tenders put out by the city’s procurement department in November 2015 for electric batteries for vehicles and motorized equipment, in which

The facts show that the city’s procurement department misled East Penn in its legitimate expectations.

the lowest conforming bidder was Power Battery Sales Ltd. (now named East Penn). As of January 2016, the city’s procurement department told representatives at East Penn it would be getting the contract, and concluded a temporary agreement allowing the city to buy batteries from the company until the contract was officially signed.

Then in February 2016, the city’s department of rolling stock expressed concerns about the technical specifications of the contract submitted by East Penn, saying they might not respond to their needs, which they had made clear to the procurement department early in the process.

In mid-April, the two departments agreed to cancel the call for tenders and restart the process. But the inspector-general’s investigation found the procurement department never cancelled the initial call for tenders, but instead opted to start a new, parallel call for tenders without ever informing East Penn.

East Penn was still under the impression it would be getting the contract, and the procurement department reinforced this idea, the inspector-general’s office found, by extending the temporary purchasing agreement from an initial four months to a total of nine months.

When East Penn asked about the contract, members of the procurement department purposefully misinformed the company and kept it in the dark until December 2016, four months after the new call for tenders had been issued, the inspector-general noted.

Asked why East Penn was not informed of the new call for tenders, the procurement department director said it was decided it would be preferable to hold on to the initial contract in case it turned out East Penn would be the lowest bidder. It wasn’t, and lost the contract.

“The facts show that the city’s procurement department misled East Penn in its legitimate expectations. The inspector-general concludes that the department acted contrary to the most fundamental concept of acting in good faith and in its obligation to inform the company.”

In addition, the inspector-general noted the department never informed elected officials there were two calls for tenders issued in parallel.

The inspector-general thus recommended the contract finalized with Uni-Select Québec Inc. (Centre de pièces Gagnon) be cancelled and a new call for tenders be opened.

He stressed neither of the companies was at fault in the dossier.