CEO says foreign bids cost more
By Christopher Walsh
The City is wasting money on the new St. Patrick’s Island Bridge project, says the CEO of Nemalux LED Lighting. The Calgary-based company had their bid to provide lighting for the bridge rejected, even after offering to do the project for “next to cost.”
Jode Himann says Nemalux’s bid was rejected without reason and he was told by an electrical contractor that there would be consequences if he pursued the matter.
“They threatened to blacklist me if I were to inquire any further with them,” Himann said.
“If they had a good reason or just said it wasn’t in the stars … then it’s normal and I’ll go on to the next project. To me, something strange is going on.”
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Himann brought the issue to the City of Calgary, but says he was still not satisfied with the answer he received. He is now calling on the City to give preference to local companies during the bidding process for large projects.
“It’s kind of weird to me because we had a strong, competitive package for them from a very local, reputable company,” Himann said. “We want to build Calgary to be a better place. It’s just so weird in this situation that it was decided to spend money in Germany and England.”
Graham Construction won the contract for the $45 million St. Patrick’s Island project after an 18-month public selection process. The City is not responsible for any sub-contracting the company might do, says a City representative.
“We have a contract with them to hold them responsible for that,” said Susan Veres, a spokeswoman with the Calgary Municipal Land Corporation. “We have great confidence in their ability to deliver quality products on time.”
Veres pointed to the $70 million Fourth Street Underpass project which was completed by Graham on time and under budget.
“We have confidence in their internal systems and protocols and the way they manage their business.”
Veres says there is no policy in place to give preferential treatment to local companies.
“We always run very public, competitive processes,” she said. “If local can deliver the project [they will get the contract]. But we don’t have processes for favouritism, no.”
Himann says giving preference to local companies for projects would benefit everyone involved.
“I think that makes good business sense,” he said. “The product has to be an international quality product, but if you don’t have to ship and get warranties from Germany and England it’s financially sensible as well.”
Himann insists he lowered his price in order to work with the City on the St. Patrick’s Island Bridge because he wanted to do a local project, outside of the company’s usual international projects for big companies. But the bid was rejected and he says the company went with a foreign bid for double Nemalux’s price.
He says he understands the risks involved on speaking out about the contracting process.
“Right now we’re exposing ourselves to a significant amount of risk by talking out,” he said. “It’s an evaluated risk. The only way we could do it is because we’re an international company and we have international customers.
“I’ve lived in Calgary all my life and I love Calgary and love Alberta….In this scenario, it’s an indication that things can be improved. That’s why we’re speaking out.”
Representatives from Graham Construction did not return calls as of deadline.
The St. Patrick’s Island Bridge is expected to be completed by fall 2013. The rest of the $45 million project will involve a full landscaping of the island, expected to be completed by fall 2014.