This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide.
In its November 2019 report entitled Audit of Stage 2 Light Rail Transit (LRT) Project Procurement, the City of Ottawa’s Office of the Auditor General (referred to as OAG in the report) made a series of recommendations for improving procurement practices in public-private partnerships (P3s) and other major projects. As the Auditor General stated, “while we did not identify areas of non-compliance with the RFP, we have identified some areas for improvement to ensure a smooth evaluation process for future procurement.” Those areas of improvement included providing more training to evaluators, using a phased bid-compliance process to avoid compliance disputes, and establishing clearer delegation of authority protocols.
In its report, the Auditor raised concerns over the lack of experience of the City evaluators and recommended that in the future more training be provided to evaluators before participating in major projects:
We had expected to observe evidence of the application of criteria and documentation for the selection of evaluators considering the importance of these roles, however, no criteria or documents were used in decision making. In our discussions with the City, a selection of technical evaluators considered the participant’s experience. However, the members selected for the Technical Evaluation Committee did not have P3 procurement bid evaluation experience, except for one member of the evaluation committee who had conducted some areas of technical evaluation for the Stage 1 LRT procurement. P3 projects are considerably different from traditional procurement projects and in our view, related evaluation experience, combined with the experience using the Infrastructure Ontario templates should be considered important when selecting evaluators. While the evaluators possessed relevant operational experience in rail related activities, some with P3 projects, we found that four of the five Technical Evaluation Committee evaluators did not possess procurement evaluation experience for P3 projects. In the event of an absence of P3 procurement evaluation experience among the evaluators, the City should have considered additional training and coaching to evaluators involved, or alternatively, could have considered obtaining the services of contractors with this expertise.
With respect to compliance assessments, the Auditor General recommended using a phased compliance approach that allows bidders to rectify any non-compliance in their initial submissions in order to avoid downstream disputes over compliance issues:
In future P3 projects, the City should consider using a phased bid compliance process clearly stated in the RFP. This would provide an opportunity to bidders to modify their submissions as part of the technical evaluation process, to provide missing or insufficient bid information in order to comply with mandatory requirements and avoid an unnecessary non-compliance determination.
The Audit also recommended a clearer delegation of authority, noting that concerns had been raised by some members of City Council over their lack of involvement in the process:
It is unclear to the OAG if the agreed upon delegation of authorities by Councillors was fully understood and properly communicated in the March 2017 Report to reflect the Councillors’ information needs. This lack of clarity was evidenced as some Councillors recently expressed dissatisfaction with the level of information being disclosed in conjunction with the March 2019 report and an insufficient amount of time to digest the information for purposes of approving the preferred proponent.
One way in which this could be accomplished would have been by involving members of Council in approving the front-end design planning decisions and then providing training to Council members on the importance of establishing appropriate delegation protocols that ensure an arm’s length evaluation and award process that is shielded from inappropriate political interference.
As this report illustrates, even projects that are found to have complied with the solicitation rules can provide case studies that identify areas for future improvement for other project teams in their future projects. Moving forward, purchasing institutions should implement advanced training programs for all individuals that are involved in major projects, including, amongst others, evaluation team members and elected officials.
