Memo: Release of the Stage 2 Light Rail Transit Trillium Line Project Procurement documents

Addressed to Mayor and Members of Council by the city manager and released to the media:

On February 12, 2020, City Council directed me to release the Stage 2 Light Rail Transit Trillium Line Project Procurement documents, including the technical compliance scores, the technical evaluations and the specific bid amendments made to the contract to ensure that Council's criteria for the project are going to be met, to City Council and the public as soon as possible and in advance of the March Finance and Economic Development Committee meeting.

The documents are now ready and have been uploaded to two shared drives – one for Members of Council and one for public access. The suite of documents released covers the full spectrum of the Stage 2 Trillium Line Procurement, from the Request for Qualification phase to the completion of the Project Agreement.

These documents, when reviewed in their entirety, show that the complex, lengthy and fully documented procurement process was conducted in the fair, open and transparent manner confirmed by both the Fairness Commissioner and the City's independent Auditor General. They will show that TransitNEXT was the only bid that met the City's affordability threshold – on a net present value basis, the other two bids were approximately $100 million and several hundred million dollars more – money that would have had to come exclusively from the City of Ottawa taxpayer.

The documents will also confirm answers previously provided to some of the most common questions raised about the procurement related to the Technical Evaluation scores and how they relate both to the bid process, and then to the final, negotiated Project Agreement. Specifically, they demonstrate to Council and the public that:

• The Technical Conformance Review established that the Technical Submissions by all three (3) Proponents, including TransitNext, contained no Material Deviations—meaning they all passed the 'go/no go' technical threshold for consideration that was expressly set out in the RFP;
• Any individual poor quality responses for specific elements of the Project Agreement from all of the Proponents in the Technical Evaluation phase do not reduce each of the Proponent's obligations to meet the project design, construction, maintenance, operations and financing of the Project Agreement should they be selected as the Preferred Proponent – as these are expressly addressed as part of the negotiations phase;
• The discretion exercised by the Executive Steering Committee with respect to the technical scoring was blind – no member of the Committee knew which firm had which score. The discretion used was based on advice from Legal Counsel and the Fairness Commissioner, and was exercised without any knowledge of the Financial Submission as well;
• Contract negotiations addressed all of the deficiencies in TransitNext's RFP Submission before they were recommended as the Preferred Proponent to City Council in the report that was considered and approved on March 6, 2019; and
• The executed Project Agreements require TransitNEXT to meet Council's criteria for the project design, construction, maintenance, operations and financing for the Stage 2 LRT Trillium Extension.

It should also be understood that the binding bid pricing from the other two proponents expired March 20, 2019 at the time Council considered the contract award to TransitNEXT, making it virtually impossible to successfully close with either of those proponents in that timeframe should Council have voted no to the contract award at its on March 6, 2019 meeting. This would have likely then resulted in a failed procurement with its resultant and unavoidable increased costs and possible jeopardy of the federal and provincial funding.

To help Members of Council and the public navigate all of the information in the shared drive, staff has prepared an index that shows where each document fits in the context of the overall procurement process, identifies the rationale for the required redactions in a few of the documents, and provides other information that staff believe will be helpful. The index and the related Information Previously Distributed report are attached to this email.

As well, my office has arranged for the City's experts on this file, specifically Michael Morgan, Isabelle Jasmin, Geoff Gilbert (Norton Rose Fulbright), Remo Bucci (Deloitte), and Louise Panneton (P3 Advisors) to be available to meet Members of Council in small groups at various points in time on Wednesday and Thursday to answer any preliminary technical questions you might have. My office will be calling each of your offices to schedule times, being mindful of the size of the groups and avoiding any potential quorum issues. They will also ask if you wish to receive a hard copy of the documents. There are at least a thousand pages, so we will only be printing them for Members (one per office) upon request.

All of these same experts will be appearing with me before you at the Special Meeting of the Finance and Economic Development Committee on March 9, 2020. At that time, you will be able to ask any questions of them related to the Stage 2 Procurement documents and the Responses to the Inquiries listed on the agenda.

Finally, in response to an information question by Councillor McKenney and as has been noted a number of times to Council, Norton Rose Fulbright was procured through a competitive process overseen by the City's Supply Services in early 2016. Throughout the Stage 2 procurement process, Norton Rose Fulbright, along with all other participants, were required to disclose any actual or potential conflicts of interest; the relationship to bidders was disclosed by Norton Rose Fulbright; and all disclosures were reviewed and subsequently cleared by the Fairness Commissioner. All major law firms (as well as other experts, such as accounting firms) who advise on large infrastructure projects may advise a number of bidders or authorities on other unrelated matters/projects. This is known to the City, and it is understood in such procurements that, when a firm has previously done work for another client that is in some way later involved with the City, it does not generally give rise to a professional conflict.

In closing, please contact me directly should you have any additional questions about the above approach.

Steve Kanellakos

​Source : City of Ottawa

Memo 

Document release index