Hamilton consultant was contracted for thousands in untendered work

A lower city Hamilton councillor stepped outside the city's usual procurement rules to spend thousands to hire an urban planning consulting firm. But that councillor says he had no idea he was not following the right process.

I repeatedly probed to ensure no rule was violated.- Aidan Johnson

Aidan Johnson of Ward 1, along with Jason Farr from Ward 2, spent thousands in the last two years hiring the James Street North firm Civicplan to advise on how to spend some of their annual allotment of $1.6 million in area rating money – money Wards 1 through 8 get to spend on infrastructure projects.

In Johnson's case, he hired the firm to coordinate participatory budgeting in Ward 1 — a process where residents suggest and vote on local projects to fund.

Specifically, city documents show he's paid the firm $34,951.51 so far in 2017 to help assemble the citizen ideas and voting, and about $57,797.41 in 2016 — which finance head Mike Zegarac told councillors didn't follow the city's procurement rules.

That surprised Johnson, a first-time councillor who took office in 2014. He says he inherited the process and the consultant, and that he's asked city staff numerous times if he was following the rules.

"I repeatedly probed to ensure no rule was violated," he said.

As for Farr, he paid the firm about $52,940.50 for his Plan Local concept last year, which saw residents, including school children, vote on street safety projects.

It seems to me a little bit skewed, if you will.- Brenda Johnson

All told, the consultant has received $264,698.33 in city work for various offices and departments since April 2015 – much of which was untendered.

Donna Skelly, Ward 7 councillor, brought this up at a city council audit, finance and administration committee meeting Wednesday. The firm recently did Ward 7 work when Skelly wanted to look at the possibility of a fashion incubator at the former Eastmount school building.

Skelly has been on a hunt for disparities when it comes to how the city uses consultants. This was the second issue she highlighted this week. Based on Wednesday's conversation, city staff will review procurement rules and report back in January.

Zegarac said many of the Civicplan items fell under policy #19 of the procurement rules — that is, projects that aren't compliant.

Under the city's procurement policy, projects of $10,000 or more require getting three quotations, or in some cases, a request for proposals. There are exceptions when a vendor is uniquely qualified, but Zegarac said that process wasn't followed either.

"While councillors might have felt it was justified to single source it," he said, "they just didn't follow the appropriate process."

Other councillors joined Skelly in being concerned. "I don't like the optics of this," said Coun. Lloyd Ferguson of Ancaster.

Brenda Johnson, Ward 11 councillor, said she didn't think area rating money could be used on consultants. "It seems to me a little bit skewed, if you will."

Area rating is a process where some wards receive additional dollars to compensate for service disparities.

Johnson said it's clear everyone needs greater clarity around how councillors can spend area rating money. He has questions himself.

"I am continuing to learn about the norms and the rules that govern area rating. Today was another day of learning. It's certainly the case that I've been asking questions all along."

Farr wasn't at Wednesday's meeting, but said in a phone interview that some of the money came from his discretionary budget, a fund of $100,000 within the area rating budget. Council approved any hiring outside of that, he said.

He also defended Civicplan's work. "They get a lot of work because they do an excellent job."

Civicplan didn't respond to requests for comment this week. The firm has also done work around the SoBi bike share program, including research and a survey of users.

That wasn't the only consulting-related item on the agenda Wednesday.

Chris Murray, city manager, filed a report explaining why the city's director of audit services found earlier this year that millions had been mismanaged in consulting fees.

Murray's report, which he'll present to councillors next month, showed much of what appeared in Charles Brown's report is already being remedied.