Mimi Williams <XXXXXXXXX@gmail.

com>

City of Edmontons procurement practices

27 messages Doug Griffiths <doug.griffiths@gov.ab.ca> To: XXXXXXXXXXXXXX> Cc: Cal Dallas <cal.dallas@gov.ab.ca>
AR54077

Thu, Feb 9, 2012 at 10:33 AM

Ms. Mimi Williams XXXXXXXXXXXXXXX

Dear Ms. Williams: Thank you for your letter of January 19, 2012 on the City of Edmontons procurement practices in respect of a number of contracts relating to the proposed downtown arena. Your analysis of procurement obligations under the Agreement on Internal Trade is correct. Municipalities are also subject to the public entity procurement provisions in the New West Partnership Trade Agreement with British Columbia and Saskatchewan, which require open and non-discriminatory access to procurements above $75,000 for goods and services and $200,000 for construction. There are also limited circumstances where a municipality is allowed to procure in a manner that is not consistent with these obligations. The province has contacted procurement officials from the City of Edmonton to gather further information on the procedures followed. Thank you again for writing. Sincerely, Doug Griffiths Minister

cc:

Honourable Cal Dallas Minister of Intergovernmental, International and Aboriginal Relations

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XXXXX XX Street NW Edmonton, AB T5B XXX

January 19, 2012

The Honourable Doug Griffiths, Minister of Municipal Affairs #104 Legislature Building 10800-97 Avenue Edmonton, AB T5K 2B6 Fax: 780-422-9550

Dear Minister: I am writing to draw your attention to a matter which I believe is of grave and immediate importance regarding the Edmonton Mayor and City Councils ongoing push to build an arena downtown. You may recall that I intended to correspond with you last fall regarding several concerns I have had surrounding this proposed development. Unfortunately, a car accident left me unable to carry out that intention. While my earlier concerns - which related to matters such as in camera decision-making and what I believed were questionable land deals - remain significant, I am writing today because I believe that the latest announcement by the city (that the Katz Group has selected a project manager and that the city has approved this) puts Edmonton in violation of the Agreement on Internal Trade (AIT). Paula Simons column in the January 16th edition of the Edmonton Journal sums up nicely what I am referring to: On Monday, the city announced that it had signed a deal with the American-based ICON Venue Group to serve as project manager for the proposed new downtown arena. Mayor Stephen Mandel, in a burst of enthusiasm, also told reporters that the city was signing a deal with 360 Architects of Kansas City to design the arena. That was a tad premature. While the ICON deal was officially signed on Friday, the 360 deal is still in negotiations, though the city says those negotiations are going well. As you are aware, Minister, the AIT, to which Alberta is a signatory, sets out that the province is responsible to ensure that municipalities comply with this Agreement (Article 102) and that they must comply with the requirements involving Procurement, as set out in Chapter 5. The purpose of Chapter 5 (from the Internal Trade Secretariat website) is to establish a framework that will ensure equal access to procurement for all Canadian suppliers in order to contribute to a reduction in purchasing costs and the development of a strong economy in a context of transparency and efficiency. I cant imagine this agreement prohibits American or foreign suppliers from participating in the procurement process, but it seems clear to me that one of the goals of the AIT is to ensure that Canadian suppliers be provided with a level playing field when it comes to being awarded government contracts. Specifically, the AIT ensures that they will be given a fair opportunity to bid through an open and transparent process governed by regulations and oversight by the provinces. Under the agreement, this expenditure of public funds requires a call for tenders. Its not optional. From the Service Alberta website: Effective July 1, 1999, Annex 502.4 (MASH Annex) extended the procurement provisions of the AIT to MASH Sector entities, which includes municipalities, municipal organizations, school boards and publicly-funded academic institutions (includes universities and technical educational facilities), health (includes hospitals and regional health authorities) and social

Minister Griffiths Page 2 of 2 January 19, 2012 service entities, as well as any corporation or entity owned or controlled by one or more of the preceding. Since 1999, all MASH Sector entities in the Province of Alberta are subject to the procurement provisions of this Annex. I did attempt to contact the city and left a message for Mr. Rick Daviss several days ago. While my call has not been returned, Mr. Daviss did respond to Ms. Simons for her article. She sums up his position here: Rick Daviss, a senior manager with the city, whos just been appointed executive director of the arena project, insists theres no legal problem with awarding two such high-profile, multimillion-dollar contracts without a public competition. The Katz Group, he says, evaluated more than 10 possible candidates for each contract. Their search process, says Daviss, met or exceeded city standards. The Katz Group did not advertise on the same public websites the City of Edmonton generally uses. On the other hand, Daviss argues, because the Katz Group went on an international talent hunt, it interviewed a wider range of candidates than a typical city tender process. Minister, please have your staff review this matter and advise if you believe that the citys actions in this matter conform to the requirements set out in the AIT. Again from the Service Alberta website: The key elements of the AIT Procurement - Chapter Five and MASH Annex include: - A non-discriminatory, fair and open tendering process - A transparent and fair method of evaluation disclosed in the original call for tender - Chapter 5 covers the procurement of goods over $25,000 and services and construction over $100,000 - MASH Annex applies to procurement values over $100,000 for goods and services and $250,000 or greater for construction - The use of a Electronic Tendering System as a means of providing fair and equal access to all suppliers as it relates to public sector contract opportunities By the citys own admission, it is clear that none of these requirements were met in the awarding of the project management contract, nor in the selection of a project architect, inadvertently announced by the Mayor earlier this week. None of this would apply if Mr. Katz was using his own funds or financing this project. Hes a private citizen and his business is free to operate within the confines of the law without the scrutiny that our elected governments spending public funds must endure. But with the downtown arena, that is not the case. Whatever the Katz Group has spent on this project to date is not my concern. The City of Edmonton, on the other hand, has a responsibility to be transparent and accountable to its citizens and has an obligation to adhere to the principles set out in Chapter 5 of the AIT. Awarding a $30million contract without tender doesnt appear to even come close. Please consider this letter my formal request for you to look into this matter. Thank you very much in advance for your attention to this issue. Sincerely, Mimi Williams Edmonton resident