The construction company that hired the former mayor’s brother as a lobbyist and achieved a sole-source contract to build the town an arena and a pool maintain they provided a good deal and good buildings to the town in a “transparent process.”
Those arguments are included in BLT Construction’s closing statements submitted for the Collingwood Judicial Inquiry.
The second phase of the inquiry has scrutinized the decisions, actions and payments leading to the building of two fabric membrane recreation structures in town.
BLT was hired by the town in a sole-source procurement process to build and install the two Sprung structures for Central Park Arena and Centennial Aquatic Centre. Prior to obtaining a contract with the town, BLT hired Green Leaf, a company owned by Paul Bonwick, to lobby and communicate with the town in order to help BLT secure a contract for the recreation facilities.
Collingwood’s lawyers have argued, in their own closing statements that BLT was given “improper advantage” in the contract process for the recreation facilities due to the involvement of Paul Bonwick (former mayor’s brother), Rick Lloyd (former deputy mayor), and Ed Houghton (former interim CAO for Collingwood).
“This advantage was to the town’s detriment,” states the town's closing submission. “Although BLT disputes it, the evidence strongly suggests that the town paid 6.5 per cent more than it otherwise would have [because of Bonwick’s involvement].”
BLT’s lawyers, in their closing submissions, argue the town paid less than BLT’s standard margin because of Bonwick’s involvement.
The 6.5 per cent rate noted by the town’s lawyers refers to the percentage of the contract, between BLT and the Town, paid to Green Leaf, a company Bonwick owned and BLT hired.
“It was immediately clear that [Bonwick] could achieve what [BLT] could not: persuade Collingwood’s council to secure a contract,” states BLT’s closing submission, which adds BLT did not know Bonwick was related to the mayor at the time. “It was always understood that Green Leaf would only be paid if the contract was secured, and that any payment would come out of BLT’s own, reduced profit margin.”
The town used proceeds from the 2012 share sale of Collus to PowerStream to pay for the recreation facilities. According to the documents compiled by the inquiry, the town used $10,081,989 from the proceeds to pay for the arena and the pool. The town paid BLT a total of $13.9 million for the two recreational facilities.
An email exchange between BLT and Green Leaf shows BLT asking Green Leaf what to add on to the project budget as a fee, Green Leaf responded stating BLT should add 6.5 per cent across the board.
That fee was added, as well as a profit margin for BLT before budgets were sent to the town.
“While BLT’s margin would have been between 15 and 18 per cent, in the case of Collingwood, a reduced 7-8 per cent margin was added specifically to account for the anticipated fee of Green Leaf,” states BLT’s closing submission. “In the end, Collingwood likely paid less than BLT’s standard margin.”
Invoices sent to BLT from Stec and Bonwick set out the following fees for the project: $199,226.76 for the pool, $470,455.03 for the arena, and $87,053 in HST for a total of $756,740.42.
Records show BLT requisitioned a wire transfer of $756,740.42 to Compenso Communications - Paul Bonwick, and it was sent to an account owned by Green Leaf. The transfer was made within days of BLT signing the contract with the town and receiving the first payment from the town.
According to BLT, their ultimate goal in hiring Green Leaf was for Abby Stec, an employee at Green Leaf, to communicate between BLT and town CAO Ed Houghton, and for Bonwick to engage in lobbying efforts to persuade members of council, and others, that a Sprung-by-BLT was the right solution to meet the town’s needs.
BLT also argued part of the deal with Bonwick’s company was for Green Leaf to seek opportunities to provide Sprung-by-BLT solutions to other municipalities.
“As a result of the intervention of the CBC and Ontario Provincial Police, these future plans were put on hold,” states the BLT closing submission.
BLT states it never tried to conceal Green Leaf, or Bonwick’s, involvement, citing evidence showing BLT’s communication, through Abby Stec, with Collingwood’s CAO, Ed Houghton.
“BLT remained at the ready as Abby Stec and Paul Bonwick engaged with the head of town’s staff - Collingwood’s CAO Ed Houghton – to determine exactly what Collingwood’s recreational needs were so that the Sprung solution could be properly crafted and priced,” stated BLT in the closing submission.
The Inquiry is still underway with Commissioner Frank Marrocco, his counsel, and the inquiry team working on a final report to be delivered this year with Marrocco’s findings and recommendations as a result of all he saw and heard during the three-phases of inquiry hearings.
