Bid evaluation system is 'flawed'

The process to evaluate bids for city projects needs to be reviewed, said a project manager with Lacroix Construction.

Jordan Binotto said the city awarded the contract to tear down the Ash Street water tower to an out-of-town contractor, despite his company submitting a bid that was about $85,000 cheaper than the successful bidder. Furthermore, Lacroix's estimated timeframe from start to finish for the project was three to four weeks, about half of the time in the Priestly Demolition proposal.

The work started Nov. 8.

Lacroix submitted a tender of $107,680 plus HST; Priestly Demolition's tender came in at $191,500 plus HST. That means the city will spend an additional $83,820 of taxpayers money to bring in a company from another city to do local work, Binotto said.

Binotto said he is well aware that contracts should not be awarded based on the lowest bid. This particular contract uses a points system, where points are awarded for experience, price, proposed methodology, lead time to complete the project and references. A total of 100 points are available: 30 points for experience, 15 points for price, 25 points for methodology, 15 points for lead time and 15 points for references.

Binotto said the local construction company was told by the city's Capital Projects manager Ed Vildis that the the company's methodology is where it lost points; however, the city agreed in principal that Lacroix's methodology compared to Priestly was the same in nature.

“The proposal submitted by Priestly, we were told, was 'more colourful and contained pictures.'” Binotto said. “This underscores a flaw in the current point system.”

There is nothing wrong with how the city handled the request for proposals, but there is definitely something wrong with the system as a whole, he said.

The current system could very well mean that Lacroix could have submitted a bid of zero dollars to do the work, and Priestly could have submitted a bid of millions of dollars, and the contract could potentially still go to Priestly.

In its defence, the city's Chief Administrative Officer stated in a press release that respondents' methodology in the demolition of the Ash Street water tower was extremely important in the request for proposals due to it being a high-risk project. Furthermore, the total cost of the project is $191,500, which came in well below what was approved as part of the 2011 municipal budget.

Doug Nadorozny said while the majority of demolition work is by tender, in this case, a Request For Proposal was chosen because of the complexity and high-risk nature of the demolition. In an RFP, a number of factors are taken into consideration. Price is only one factor.

“Lengthy discussions occurred prior to issuing the RFP for the demolition of the tower; this demolition is a very complex and high-risk project, involving many health and safety issues,’ Nadorozny stated.

The RFP process is very rigorous and does not allow for those scoring the proposals to assume information. Six proposals were received; of those, Priestly Construction’s was the proposal that provided the most amount of detail with regards to health and safety and methodology, and that proposal ultimately scored the highest in the process. The successful contractor also addressed, in great detail, a plan that took into consideration the close proximity of nearby homes.

The bidding process is open, fair and transparent and does not permit special consideration for local bidders, Nadorozny said. This process allows any and all interested parties to submit a proposal.

All RFPs and tenders are advertised on the City of Greater Sudbury website and are available for downloading at http://www.greatersudbury.ca/pubapps/tenders/index.cfm?lang=en.

Binotto was quick to point out that the company isn't holding a grudge, nor is it questioning the reputation and quality of work that can be done by Priestly. The intention is to merely inform the public of how tax dollars are being spent and for what reasons.

“It's very frustrating, and not just as an employee from Lacroix, but as a taxpayer,” Binotto said. “The city is a very valuable client, and we've had many successful projects, and we look forward to even more projects.”

Posted by Mark Gentili