Two projects in Prince George, B.C. have received contractor alerts from the British Columbia Construction Association (BCCA) after complaints of onerous bidding conditions by BC Housing.
“We couldn’t promote them in good conscience without advising the contractors of the risk,” said Chris Atchison, BCCA president. “We did promote them but also provided the alerts. We want to be a good provider and it’s not something we do often or want to do often. For some years we have been trying to work with BC Housing and we have quarterly meetings. We have a respectful relationship, but it is not resulting in the change the contractor community wants to see.”
BC Housing develops, manages and administers subsidized housing options across the province. It also licenses residential builders, administers owner builder authorizations and carries out research and education for the residential construction industry, consumers and the affordable housing sector.
The projects are a building envelope remediation on Westwood Court and renovation work on the Hart Haven Group Home at Dagg Road. The combined value of the projects is $9.5 million.
Atchison said the association expects public project procurement to be fair, open and transparent.
“When those conditions are not met, we consider them to be onerous,” Atchison claimed. “Sometimes these alerts might be needed to address things going forward. At the end of the day we need schools, hospitals, roads etcetera. Having these conditions in an already competitive market is not serving anyone in the long run.”
BC Housing defended its process, but stated it regularly meets with the BCCA and takes its concerns seriously.
“Our intention is always to build or renovate safe, affordable housing with a responsible use of public dollars,” said Tracy Wells, senior communications adviser for BC Housing. “This is about ensuring that we get the best bid, not just the lowest bid.”
Wells said BC Housing considers factors, in addition to price, when reviewing submissions. This includes a contractor’s experience, stability and how they engage with tenants and residents in the community.
“BC Housing is committed to strong industry stakeholder relationships and takes the notification from the BC Construction Association seriously,” said Wells. “The identified concerns from the BCCA have been part of our regular discussions.”
Scott Bone, CEO of the Northern Regional Construction Association (NRCA), brought the projects to the attention of the BCCA. Bone explained the association has also had concerns about BC Housing for years, noting its procurement methods do not follow the province’s guidelines to use a two-stage process.
“The Capital Asset Management Framework, adopted by the province, clearly states that if you are going to do procurement and prequalification, you must do a two-step process,” said Bone.
Warren Perks, vice-president of industry standard practices for the BCCA, explained a two-stage process is where the respondents first respond to a Request for Qualifications (RFQ) where the contractors are evaluated to deem if they have the necessary skills to perform the construction of a project under the delivery model being used. The second stage is where the respondents provide information on what is usually just the financial information. He noted that, depending on the delivery model, this could be fees, the bid amount, site accommodation costs, other costs or possibly scheduling.
Perks alleged BC Housing is using a process that combines the two-stages into one.
“Our view is that (one stage) is a very subjective process which is questionably fair and transparent,” said Perks.
According to the BCCA and the NRCA, the process often leads to fewer bids.
“What we really feel is that contractors are becoming less interested,” said Atchison. “Our pulse is that they are becoming less interested in being burdened by risks and they are not bidding or not adding these costs. It’s not reasonable for it to be happening in this manner. Costs are already inflating due to labour shortages and other factors.”
The BCCA encouraged public owners to contact the regional construction associations or the BCCA for guidance early in the procurement process, and to follow the CAMF document as the best baseline for fair, open, and transparent processes.