Montreal warned years ago about cost overruns, confirms released report
Published Monday, November 12, 2012 1:33PM EST
Last Updated Monday, November 12, 2012 9:49PM EST
MONTREAL—The City of Montreal has released a report outlining official knowledge of cost overruns of at least 30 per cent on construction projects going back to at least 2004
Michael Applebaum resigned from the city of Montreal's executive committee last week, saying that among other things he was outraged by the committee’s decision to keep the report about inflated costs on construction projects secret.
In response to allegations that municipal officials were hiding old documents, the city released Monday a half-dozen reports that examined construction costs.
The earliest of those documents dated back to 2004 and it stated that Montreal was "a closed market" when it came to construction, with public-works contracts going to the same handful of companies over and over again.
"It is always the same companies that share the work, which is likely to explain the high cost," the 32-page study said. "In Montreal, the market is not considered to be very open and, in some cases, may even be quite closed."
The city also said it was clear that there were very few mechanisms in place at the time to prevent fraud or collusion which was allegedly taking place at every level of the administration.
Elected officials say that since then things have improved, pointing to the 2009 introduction of a code of ethics for engineers as one example.
But nowhere in the study was there any indication that municipal employees might have been corrupted or involved in collusion.
Such revelations are now emerging, years later, at the province's Charbonneau commission which is exposing cozy ties between the Italian Mafia, construction companies, and corrupt municipal officials.
The city's highest-ranking bureaucrat told reporters at a technical briefing Monday that former mayor Gerald Tremblay, who resigned last week, only found out about the 2004 document last month.
But the release of the report has people demanding to know when was this report finished and when did elected officials know about this report.
The current city manager, Guy Hebert, told reporters the document had been given to a former city manager, Robert Abdallah, and former executive committee chair Frank Zampino. Zampino now faces criminal corruption charges.
Two years later, another report indicated that the risk of corruption was high and that the city had "no mechanism to prevent collusion, fraud, price-fixing."
That 2006 report and a followup to it in 2009 offered a lengthy list of suggestions for dealing with the problem. Hebert said those recommendations are in effect today.
Speaking on Monday afternoon, Richard Deschamps, the man chosen as interim mayoral candidate by Union Montreal, said that no effort to hide this report was ever made.
"We are under attack by people who we will not name who are acting with motives that we do not understand," said Deschamps.
According to Applebaum, he and former mayor Gerald Tremblay were made aware of the report’s existence on Oct. 29, 2012.
On Friday, Applebaum said that the Executive Committee, which is composed entirely of municipal councillors belonging to the Union Montreal party, voted last week to conceal the report until after the vote to choose Montreal's interim mayor.
On Sunday he told CTV Montreal's Tarah Schwartz “They didn’t want to be questioned on the report. Corruption and collusion is one thing, but hiding reports is another thing and I couldn’t be part of that.”
The vote to replace Gerald Tremblay is scheduled to take place this week.
—with files from The Canadian Press.