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Games tendering practices must be fixed

The Canada Games Host Society calls itself open and transparent.But that doesn’t necessarily make it so.

The Canada Games Host Society calls itself open and transparent.

But that doesn’t necessarily make it so.

In the last couple of months the Whitehorse business community has grown increasingly frustrated with the society’s tendering practices.

They have a case.

The host society gets about $7.5 million from business sponsorships. It gets roughly $14 million from federal, territorial and city grants, for a little more than $21 million total.

That blended funding complicates things a little. But keep your focus on the government money for a minute.

That’s the important thing.

The spending of government money — collected from all citizens and business — must follow certain rules.

But, in this case, the money flows to a non-profit organization.

And its rules are less stringent.

“We’re not government, so we don’t practice things exactly the way government does,” said Chris Morrissey, the Games’ general manager.

In the last month we’ve glimpsed what that means.

For example, unlike government, the society doesn’t have to open tenders publicly.

The society awards the contract it deems is best. At some point in the future, everyone can see the bids.

Or, as Games president Piers McDonald said: “When the host society issues a tender, anyone, including all bidders, will be entitled to know of the results of that tender.” (See letter on page 9)

Which raises another question: When?

We suggest the tender documents will probably be available after the tent has come down and the organization is moving on to the next community. In short, when it doesn’t matter anymore.

Contracts larger than $20,000 are tendered, and there’s a local preference clause.

But they don’t always go to the lowest bidder, said Morrissey.

The Games have encouraged people to participate through in-kind donations, holding out the carrot of larger contracts if they participate.

That has, at times, looked a bit deceitful.

G-P Distributing Inc, a local food distributing company, donated $30,000 to the Games.

That’s a sizable donation.

But the Games handed off the food contract to Yukon College.

And G-P lost the $500,000 contract to Houston-based Sysco, a multinational conglomerate with 170 outlets and 47,500 employees across Canada.

Sysco provides food services for Yukon College. It has supplied the Canada Games before.

And its Yukon representative, Glenn Sands, sat on the Games board.

For the last six months or so, as part of his volunteer services, Sands planned the Games menu.

He did not plan the grocery list, said Morrissey.

Sands was brought on as a chef, not a Sysco rep.

After planning the menu as a chef, he resigned from the board six weeks before the food tender was put out.

Sysco bid and won the contract. The public can’t see the winning bid until sometime in the future.

On the surface, the situation doesn’t look good.

We all wear multiple hats, noted Morrissey.

Next, there’s Yukon Meat and Sausage.

It donated $1,000 in free lunches to the Games. Staffers ate the lunches.

In April, Games staff approached the business, asking it to partner with Yukon College in supplying meat to the athletes, a $35,000 proposition.

At the time, the business was also asked to increase its sponsorship.

Yukon Meat and Sausage donated another $2,000 in lunches. Staffers ate them.

It was asked for quotes to provide the meat for the Games. It provided them.

In October, the whole thing went to tender through the college.

Worn out by the quote-getting process, the small business opted out of the tender.

“The Games tenders are clear,” said Yukon Meat and Sausage’s Sandra Wohlfarth. “There’s closing dates, everything. But with the college handling it, we didn’t have any of that — dates weren’t adhered to, there was nothing in writing other than the menu.”

That would be Sands’ menu.

Sysco got the meat contract.

Then, out of the blue, the Games gave Yukon Meat and Sausage an $8,500 contract it hadn’t bid on.

“We just don’t understand this whole tendering process.”

Then consider the pin contract.

Whitehorse-based Summit Awards was interested in the contract. Owner Mitt Stehelin started talking to the Games three years ago.

In July, the contract went to Regina-based Laurie Artiss. The firm has supplied the Games before.

And Laurie Artiss was a Games consultant on the pin contract. It helped shape the tender, said Stehelin.

The Games does not hire consultants to draft procurement packages, said Morrissey.

Asked if Laurie Artiss had been to Whitehorse to consult on the pins, vice-president Chris Pasterfield admitted it had.

“We spoke to the Games people probably two years ago,” he said.

Again, the pin contract has not been shown to Summit Awards. Not yet.

And then there’s the drink sponsorship.

Northland Beverages asked for sponsorship information from the Games in December 2005. It didn’t get any.

It pushed until April, crunch time.

The Games sponsorship vice-president admitted it was in negotiations with Coke.

Coke’s local distributor is Whitehorse Beverages. Its general manager, Dave Pearson, sits on the Canada Games board.

It got the contract. The winning bid has not been made public. Not yet.

And on it goes.

It’s understandable why a national organization would want national sponsors. It makes procurement easier, especially when you’re doing it all again in 2011.

Games organizers don’t want to deal with a local T-shirt-etching company when it can line up Stanfield’s.

“Some of these sponsors we’ve brought to these Games, because they’re at the national level, will be there for future Games,” said Morrissey.

But that’s not the message it delivered to locals when it was looking for in-kind donations to bolster its business sponsorships.

The whole affair has cast a shadow over the Games. Local businesses will be more skeptical and, possibly, less generous in the future.

But, as the whole affair winds down, there are some larger questions about how the Games handles public tenders.

It receives millions in government grants.

So, sort of following accepted tendering practices isn’t good enough.

Though it says its tender process is open and transparent, it definitely has some dark spots.

Those must be fixed prior to the next Games. (RM)