In an historic decision, the Bid Protest Committee (BPC) has upheld the Communities Ministry’s award of a $221 million one-year contract to Puran Brothers Disposal Inc for the operation and maintenance of the Haags Bosch Landfill, after finding that the evaluation criteria were followed and that the company had the lowest bid.
The decision, which is the first handed down by the BPC, was based on a request for review that was made by bidder Cevons Waste Management, which had said the selection process was unfair after the announcement of the contract award in July.
“…the Bid Protest Committee (the Committee) has decided to reject the complaint. The procuring entity the Ministry of Communities is advised to continue with the procurement process,” it said in a nine-page decision, dated September 30 and which was seen by Stabroek News.
“…the Bid Protest Committee finds that the evaluation criteria were followed by the Evaluators. Puran Bros Disposal Inc’s bid was not only responsive but it was the lowest evaluated bid,” it later added.
Cevons will accept the ruling, according to partner in its joint venture Ivor Allen, who told Stabroek News that he had the feeling from his last meeting with the committee that his group would lose the protest and he was, therefore, prepared for the ruling. “At the end of the last meeting, I had come to the conclusion that we did not or could have persuaded the BPC to give a decision in our favour. So, I was kind of expecting that decision. We had committed to accept the process and therefore we have to accept,” he said.
“I am disappointed, but it was a process we committed to, so, therefore, I accept. I am not going to say the umpire was wrong because that was a process we committed to. Even though the finding was not in our favour, I would not say the Bid Protest Committee was wrong,” he added.
In addition to the BPC review, Cevons had also secured a High Court injunction to prevent the ministry from acting on the contract. While the Communities Ministry yesterday said that it will await the outcome of that pending court action, Allen yesterday said that given the BPC’s ruling, coupled with his group’s commitment to accept the findings, it will no longer be pursuing the litigation.
“The High Court process was to facilitate them [BPC] to do their works, so if they have [completed] it, is no point in pursuing the High Court matter. The reason why we went to the High Court was if the ministry had gone ahead and signed the contract and so forth, the BPC then didn’t have the power to cancel and overrule. So, it was to stall that process, in the event we got in a decision in our favour and then the process had already gone through,” Allen said.
For Puran Brothers Disposal Inc, the ruling was welcomed in light of what Manager of the company Kalesh Puran called “a long, agonizing wait.”
He noted that the company had not received word of the decision in writing but he was pleased with the news of it. “It is a long time we are waiting to work while garbage just keep piling up there,” he said. “It is the landfill we worried about because we have all the machinery to get to work and can’t do anything while the people living around there suffering. I don’t want something to happen at the site and you hear Puran Brothers responsible. We want to give priority to this landfill. A critical site like this needs urgent attention. It is a potential fire hazard if left unattended… We have the extensive compactor sitting there and not being used. The scale house is not in operation either. All the machines on site and a fire truck just sitting there,” he added.
Only determining factor
The BPC, headed by Joann Bond and comprising also Archibald Clifton and Colin Sawh, with Ewart Adams as a rotating member, noted that the Cevons joint venture challenged the award on the grounds of that Puran Brothers’ price was too low, that it had a more technically qualified and experienced team, that it had the most efficient operating methodology and that Puran Brothers’ past performance at the site was terrible.
Cevons had argued that Purans’ quoted monthly service price was too low and suggested that the company would go back to the ministry for a price variation.
The BPC noted that the bids of both Cevons and Puran Brothers were found to be the responsive by the Evaluation Committee, and the only determining factor left to be considered was the lowest price. Puran Brothers bid $18,450,000 per month, compared with the Cevons bid of $21,950,000.
The BPC said that Gordon Gilkes, the architect of the engineer’s estimate, stated that Puran Brothers’ bid was sufficient to successfully complete the project and both he and the ministry attested that the contract does not cater for a price increase and is in fact a fixed price agreement, which also stipulates performance standards. “Therefore, whatever are the effects of a too low bid price are for the procuring entity to deal with along with the awardee,” it added.
Minimum experience required
Addressing Cevons’ assertion that it had the best team, the BPC said it considered the statement subjective. “This committee agrees that the joint venture has a stellar team. However, the Evaluation Committee concluded that both Puran Bros Disposal Inc and the complainants have the minimum years required for operating a landfill as well as their key staff possess the minimum experience asked for,” it stated.
It added that the bidding documents asked for a site manager with a total work experience of ten years and a total of five years’ experience in similar works, and a technician with a total work experience of five years and a total of two years in similar works.
The BPC said the criteria did not ask for extensive experience but instead set out the minimum experience required. “Though long years of experience will always be desirable, it was not a requirement for this project. It should also be noted that the evaluators did not use a point system which would have ranked bidders against each other thus determining who was better based on the amount of scores gained. For this evaluation a yes or no system was used. Therefore, as long as a bidder had the minimum requirement they received an automatic qualification. As admitted by the procuring entity the evaluation was not to assess the best but rather to determine who satisfied the minimum requirements and as section 5 of the Procurement Act dictates, the Evaluation Committee must use the criteria outlined in the bidding documents,” it added.
In relation to the operation methodology, Cevons had said that it had planned using high density polyethylene plastic, which it asserted was the most efficient system, as a daily cover for the landfill. The BPC explained that while the method may be the most efficient system to operate a landfill, operation methodology was not listed in the evaluation criteria.
“Every procuring entity is empowered by law to determine the criteria by which Bidders will be assessed and such criteria must be followed by the evaluators. As section 5 of the Procurement Act states, “Every supplier or contractor wanting to participate in procurement proceedings must qualify by meeting such criteria as the procuring entity considers appropriate.” …The mandatory requirement to only use the criteria of the procuring entity is also echoed at Section III, page 33 of the bidding documents…,” The BPC reasoned.
“While it would have been ideal for the procuring entity to include operation methodology in the criteria and assess how each bidder would have managed the landfill (since this is instrumental to the success of the project), it is clear that the procuring entity did not consider it appropriate for this specific project,” the BPC noted as it pointed to both the Procurement Act and the tender documents.
On Puran Bros’ past performance, during a previous joint venture with the previous landfill operator BK International, the BPC pointed out that all bidders were assessed on historical contract non-performance (history of nonperforming contracts within the last three years prior to the deadline for submission of bids and pending litigation) and it noted that the Evaluation Committee deemed both Puran Bros Disposal Inc and Cevons as satisfying this criterion.
It took note of Cevons’ argument that the joint venture of BK International and Puran Bros Disposal Inc was a national disaster and embarrassment since the government was forced to terminate that contract but pointed out that both Gilkes and Emil McGarrell, the Permanent Secretary of the ministry, informed a BPC hearing that they did not blame the company for the failure at Haags Bosch as they were aware of non-cooperation between it and BK International.
The BPC said too that Lakenauth Puran disclosed that the joint venture with BK International had broken down and his company had initiated court action due to breach of the terms of the contract. It was noted too that Puran Bros had written to the ministry and requested that its name be removed from all documents and documents and contracts relating to the project due to years of non-participation. The BPC said based on his testimony, it was clear that the company was not actively involved in the last Haags Bosch project and did all that was reasonable to remove itself from the joint venture. “Further, the supporting testimony of representatives of the procuring entity confirmed that because they were aware of the breakdown they did not deem them ineligible,” it added.
