A New Process

Authority Village of Ashcroft
Details

Executive Summary

Several residents of Ashcroft complained the village was sole-sourcing contracts for the initial stages of a costly water treatment plant. As a result of our investigation, the village agreed to develop a capital procurement policy and confirmed its commitment to put the remaining phases of the project out to tender.

Complaints

The complainants were all residents concerned the village had direct awarded contracts for the design and management of a water treatment plant. Given the significant amount of tax dollars to be spent on the water treatment plant, residents questioned whether this represented best value for taxpayers. The plant was proposed because the village’s water supply did not meet the Guidelines for Canadian Drinking Water Quality and the B.C. Ministry of Health’s Drinking Water Treatment Objectives for Surface Water Supplies in BC. This resulted in annual Water Quality Advisories.

We investigated whether the village followed a reasonable process when it awarded contracts for the water treatment plant.

In response to our investigation the village said council had voted unanimously to hire a known contractor to manage the project, but had not yet awarded any contracts for the construction phase of the project. The village indicated it chose to hire the contractor because the village did not have the internal expertise to plan and manage a project of this scope and the contractor was familiar with the village’s water system and had the expertise to manage the project. Ashcroft is a small village, and, for them, this was an unusually large project. 

We asked the village about the process it followed to contract with the company to manage the initial phases of the project, and inquired whether the village had an applicable procurement policy. The village explained that its existing purchasing policy was not intended to apply to large capital projects and therefore had not guided the decision making in this case. We learned that work on several components of the project was done without any evidence of an open and fair procurement process having taken place. 

We discussed with the village that best practice is for local governments to have up-to-date, comprehensive, written procurement policies and procedures. We pointed out that procurement that is fair, open and competitive supports open and transparent local government and helps ensure that local governments receive value for the tax dollars spent. Consequently, we consulted with the village and asked whether it would be willing to develop a more comprehensive procurement policy that specifically addressed capital project procurement. 

The village agreed to develop a policy on a priority basis, and to apply the policy going forward to ensure consistent and fair procurement actions. The village agreed to ensure that the policy followed best practices in procurement, and was in keeping with two Auditor General for Local Government tools: Oversight of Capital Project Planning and Procurement; and, Improving Local Government Procurement Processes.

We considered the village’s decision to develop a comprehensive policy, and to implement a competitive procurement process going forward, to settle the matter that we investigated. When we explained the outcome of our investigation to the residents they indicated that while they remained concerned about the cost and need for the project, they were happy that the village was developing a competitive procurement process that would be implemented on future contracts. 

Outcome

We understand that a policy development and approval process is now well underway. We also understand the village has now completed a competitive process to award a significant contract for the filtration and equipment suppliers for the plant. The process started with a Request for Qualifications, where interested companies had the opportunity to demonstrate that they had the qualifications to participate in the proposal process. Three companies that passed the RFQ process were invited to make proposals through a Request for Proposal process, and the successful company was awarded the contract by the village council. 

Names in our case summaries have been changed to protect the privacy of individuals. This case study can also be found in the 2016-2017 Annual Report.

Category Local Government
Type Case Summary
Fiscal Year 2015
Location The Interior