Comment 123721

By Haveacow (registered) | Posted September 13, 2018 at 12:26:32

There is a kind of financial damage that is generally not known to the public. Its damage to your collective reputations and it has a big financial penalty!

Back in 2006, Ottawa cancelled a signed contract for the project known then as the "North-South LRT Project". The partners included 2 of the country's biggest construction and engineering firms and one of the largest companies on earth, Siemens. The project was cancelled after the municipal election of 2006 and by a mostly freshman council as well as an absolutely green, politically conservative mayor. The mayor was a fairly well known, local high tech businessman, who was sure that he could get a better project and deal, he was wrong! Later we found out just how wrong he was $42 million + expenses wrong (believed to be somewhere officially around $62 million but it varies from source to source)!

For years after, when any planning, engineering and construction firm won contracts with the city of Ottawa, they overcharged and made sure as much of their contracts as possible had to be paid up front. This was because they didn't believe the Ottawa Council would stick to any signed agreement and would change their minds if the political winds needed them to. Overcharging or "padding" their costs as well as making sure contracts demanded as much as they could legally get either up front or as soon as possible was security against an unreliable civic partner. It still goes on today, however the city has gotten much more legally clever and has somewhat cleaned up its act, when acting as a partner in signed contracts. As a consultant I can speak from experience, the city can still be somewhat "tardy" about paying smaller contractors quickly.

This has occurred without the majority of the public being even remotely aware of it. I fear this could happen to Hamilton if the new council decides to go the other way on the B-Line LRT Project file.

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