RC123 MarApr 2026 - Magazine - Page 26
PROCUREMENT
Unlike the traditional low-bid model, where cost dominates, twostage procurement considers both 昀椀nancial and non-昀椀nancial criteria.
The result is that contracts are awarded to the bidder o昀昀ering the best
overall value, not simply the lowest price, aligning infrastructure
investments with long-term performance, e昀케ciency and community
bene昀椀t.
communication gaps once bids close. “It used to be that you handed
in your bid, they opened it and everyone got the results right away.
Now procurement sits on it—contractors are left waiting for weeks to
昀椀nd out.”
This delay a昀昀ects resource planning and business continuity, says
Accardi. “You plan your crews for a project that’s supposed to start
June 昀椀rst, but by the time it’s awarded, it’s August. That
kind of uncertainty makes it hard to manage resources and
cash 昀氀ow.”
In some cases, contractors aren’t even noti昀椀ed when a
project is awarded to someone else. Greater transparency,
particularly faster release of results and clear noti昀椀cations
would make the process more e昀케cient for all parties.
Incentives vs penalties
Many municipal procurement processes rely heavily
on penalties. Rather than punishing contractors for late
delivery, municipalities could structure contracts to
reward on-time or early completion, accurate pricing, and
high-quality work.
This shift would discourage the cost-cutting often seen
in the low-bid systems and instead motivate contractors to
price responsibly, invest in training, and deliver projects
e昀케ciently. By rewarding early completion or exceeding expectations, municipalities could foster a healthier
environment in the infrastructure sector that bene昀椀ts both
taxpayers and contractors.
While the two-stage procurement model is more comprehensive
than a traditional low-bid model, in practice it can be undermined by
rules that prioritize process over quality. For example, many municipalities require a minimum of three bidders, even if there aren’t three
quali昀椀ed contractors. To meet this threshold, evaluators sometimes
accept unquali昀椀ed bidders or lower the evaluation bar—dropping an
80/100 passing score down to 70—just to keep more 昀椀rms in the mix.
This defeats the purpose of prequali昀椀cation, as it allows less capable
contractors into the competition, dilutes the value of the scoring system and risks poorer project outcomes.
Accardi suggests that municipalities explore models used elsewhere
in Canada. “In some eastern provinces, they evaluate bids based on
how close they are to the median price rather than the lowest,” he
explains. “That prevents one very low bid from disrupting the process
and gives more weight to a strong technical proposal.”
When municipalities approach procurement by looking not only at
short-term cost savings, but outcomes in every aspect of the project,
taxpayer dollars will be better spent on infrastructure that will last
longer and construction will become more e昀케cient.
Maginn emphasizes that many challenges in infrastructure projects
stem from outdated procurement methods. Adopting progressive procurement practices, particularly those that evaluate the overall value
of a bid rather than focusing solely on price, would address the root
of the problem. Often, paying more upfront rather than opting for the
lowest-cost option delivers the quality and outcomes residents expect.
Transparency and timing challenges
Accardi highlights another systematic problem: transparency and
26—RENEW CANADA –MARCH/APRIL 2026
Prioritizing Canadian products in procurement
With price being the core focus of procurement, domestic
companies like AquaPipe don’t often experience the advantage of being a Canadian supplier if a cheaper non-domestic alternative is available, despite governments putting an emphasis
on prioritizing Canadian products.
“We are a proud Canadian manufacturer and service provider,”
explains Maginn. “However, there is typically no incentive provided
to being Canadian made at the time of bid.”
Regional differences and the path forward
Some municipalities are embracing progressive procurement. Cities
like Hamilton have made e昀昀orts to evaluate bids based on value
rather than cost, while others continue to rely on strict low-bid models. Prequali昀椀cation is sometimes used to screen bidders, but rules
such as the three-bidder minimum can force the inclusion of unquali昀椀ed contractors or lead to lowered thresholds, ultimately undermining quality and long-term value for the taxpayer.
Municipal procurement is more than an administrative step; it
shapes the quality, durability, and e昀케ciency of Canada’s infrastructure. Low-bid models prioritize cost at the expense of value, often
resulting in rushed work, delayed projects, and reduced public trust.
Evaluation-based procurement o昀昀ers a path forward by balancing
fairness, competition and long-term outcomes.
While there are bene昀椀ts to the low-bid system like protecting the
taxpayer dollar, short-term cost focus often undermines long-term
infrastructure resilience. It may be worth municipalities considering
more than just low cost in their approach to procurement to prioritize
community-trusted infrastructure and more e昀케cient construction.
Regardless of municipality or type of infrastructure project, the goal
for contractors, taxpayers, and government should be the same: to see
projects that are completed on time, done well, and built to last.
RENEWCANADA.NET
ALI EXCAVATION GROUP
Although the goal of a low-bid procurement process is to protect taxpayer dollars, it
can unintentionally encourage contractors to cut corners to reduce costs.
