City of Whitehorse staff are once again back to work drafting a new procurement policy for the city.
A proposed policy came forward at council’s Feb. 17 meeting, but was sent back to administration for more work following presentations by the Whitehorse Chamber of Commerce, local resident and former councillor Kirk Cameron and a lengthy discussion among council members.
The new policy would replace the city’s purchasing and sales policy, governing how the city goes about awarding contracts and making purchases.
The policy proposed by city staff to council would have given administration authority over awarding contracts as opposed to council itself. Council would receive a report on upcoming contracts to be awarded.
The proposed policy also offers a local preference component that would have seen the city award contracts to local firms if the bid is between one and five per cent (depending on the contract amount) of the lowest non-local bid.
Lindsay Schneider, the city’s manager of financial services, told council the proposed policy was “more comprehensive than the current policy, will enhance fairness in the procurement process, and is intended to improve vendors’ and tax payers’ confidence in the city’s procurement policy.”
Whitehorse Chamber of Commerce chair Mike Pemberton argued the policy would not benefit local businesses. The one to five per cent price difference needed for a local firm to be awarded a contract is too low and he said the chamber fails to see how it will benefit the economy.
He pointed to Yellowknife’s procurement policy which outlines an 85 per cent local purchasing goal.
Catherine Constable, the city’s manager of legislative services, pointed out while Yellowknife has the 85 per cent goal, it does not specify how that might happen. The proposed policy administration brought forward outlined a way to support local business, she said.
It was also noted that 79 per cent of City of Whitehorse purchases in a year are made locally.
Pemberton also argued the definition for a local business (having a City of Whitehorse or inter-municipal business licence) isn’t clear enough.
City staff have argued there is a legal risk in having council award contracts rather than staff if council were to vote against a recommended contract award. They pointed to at least 27 other municipalities that put purchases in the hands of administration due to a number of court cases around the issue continuing to grow in other parts of the country.
Pemberton argued there isn’t anything substantiated showing the city is at risk. He requested the city get its own legal advice on the clause before pushing forward with it.
Local resident and former city councillor Kirk Cameron also took issue with the clause arguing there should be a more thorough examination of the risk of lawsuit and highlighting his concerns as a taxpayer with the proposal that city contracts be moved into the hands of administration.
Schneider and Constable said the proposed new process would see upcoming contracts ready to go out to tender or RFP come forward to council in a bi-monthly report.
It’s at that point council could consider any issues surrounding the contract and whether members want to proceed with it. There would also be semi-annual reports detailing contract awards and purchases that were made for $100,000 and over, single source contracts over $50,000, emergency procurements, contract extensions or renewals and any issues of non-compliance with the policy and actions taken around it.
Spending decisions on various projects are made by council during the budget process, it was noted.
The proposal, however, did not sit well with council members.
“I have serious problems with this overall policy,” Coun. Dan Boyd said, acknowledging extensive work has been underway for over a year to draft the document, but also stating the city “still has a long way to go.”
Along with taking issue with the awarding of contracts by city administration, Boyd also argued the city should have substantial support from the Whitehorse chamber before it moves forward with the policy.
He pointed out the policy is about the relationship between the city and those that provide goods and services. It’s the chamber that represents those providing goods and services, he pointed out.
Boyd also suggested that even if there are some risks in having council award contracts there are ways to manage that. He pointed out council members understand contracts must be awarded and purchases made according to the policy.
Others also questioned the proposed move, with Schneider pointing out that although the city has not ended up in court over a contract award, that could have been the case when council opted to cancel the beatification project for Alexander Street last year had the contractor that was set to be awarded the contract opted to argue in court.
A long list of other concerns also came forward during the lengthy discussion ranging from the use of the word “may” instead of “shall” throughout much of the policy to sustainability to the use of a fairness monitor on the award of certain contracts.
Eventually, the discussion culminated in Coun. Laura Cabott suggesting the policy isn’t ready for council to vote on as scheduled Feb. 25. With consensus among council members the policy was sent back to administration for more work.
Following that, Pemberton offered his thanks to council members for allowing the chamber to be part of the discussion and said he believes a policy can be drafted that will satisfy all.
“We believe collaboration is the key,” he said.
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