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New TTC trains won't fit on taxpayers' tracks

Author: Neil Desai 2006/09/06
A $674-million bid from Bombardier to build 234 new subway cars for the Toronto Transit Commission (TTC) received unanimous approval from the TTC, but is a far cry from a transparent and accountable deal for taxpayers.

While the deal falls under what the TTC budgeted for new cars, Bombardier was the soul bidder. To ease the optics, the TTC hired two outside consultants to confirm that the bid by Bombardier was reasonable by industry standards. But what these consultants cannot confirm is that this deal is a good one for taxpayers. Soul-sourced contracts seldom bring about value for taxpayers because they provide absolutely no price competition.

German-based Siemens has been critical of the TTC and Toronto Mayor David Miller. They suggest their company could save the city $100-million. And while this claim is made without having access to the specific TTC requirements which were only passed along to Bombardier it does beg the question: Was there a better deal to be had

Bombardier was quick to respond in the media stating their bid includes much more than what Siemens could offer including electronic route maps and a simulator for training. Had their bid not included such "bells and whistles" their price would have been closer to $499-million, $35-million cheaper than Siemens.

In addition, Mayor Miller and TTC Chair Howard Moscoe praise the Bombardier deal because a portion of the trains would be assembled in Thunder Bay. Siemens again countered stating they too would assemble a portion of the trains in Ontario should they be tenured the contract.

All this talk simply amounts to a schoolyard case of "he said, she said". The only way to settle the matter is to have both companies put their best offer forward.

If Bombardier's deal is as good as the company and politicians say it is, then they should have no problem subjecting it to fair and open tender. The TTC, Mayor David Miller and Toronto City Council have an obligation to be accountable to taxpayers and seek out the best possible deal. At this point, the only measure that will erase political skepticism surrounding this deal is to cancel the soul-sourced contract and open a competitive bidding process.

TTC Chief General Manager Rick Ducharme calls this deal a "fiasco" and quit his post in June when his calls to open up the bidding process were rejected. TTC staff has defended the Bombardier deal, not on its merits, but with the threat that opening the bidding process could delay the delivery of the new cars by a year-and-a-half.

These are all issues Toronto City Council could have addressed when they defeated a motion to close down the soul-source deal in June. Questions about the transparency and accountability with this deal continue to mount and should be at the forefront of debate when this deals approval will be voted on November 13th. That's the day city council will have their final opportunity to provide assurance that they are working on behalf of Toronto taxpayers by opening this deal to competitive tender.

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