$1M Siemens honorarium stuns council

By DEREK PUDDICOMBE, CITY HALL BUREAU Ottawa Sun

Some city councillors were shocked yesterday when they discovered Ottawa had written a $1-million cheque to a company that has launched a $270-million lawsuit against the city. Gloucester-Southgate Coun. Diane Deans said she was "surprised" when city staff told her at yesterday's corporate and economic development committee that the city had sent Ottawa LRT Corp, the consortium chosen to build a now-cancelled $1-billion light rail transit network from Barrhaven to the University of Ottawa, the $1 million payment. Deans first learned about the payout after she questioned staff about the money during a review of 443 contracts worth more than $140 million the city authorized from Oct. 1, 2007 to Dec. 31, 2007. The $1-million cheque was part of a separate $78.6 million the city paid out in 2007 and fell under "Honorarium -- Light Rail Transit."

"Siemens?" asked a surprised Deans when staff said the money was given to the company as a token of appreciation for the research and work they did on the bid for the contract. "Why weren't we ever told about this?" The two other companies that lost the bid on the project were also provided a $1-million honorarium when the city decided not to proceed with those companies. Deans said council was never told that Siemens would also be receiving a $1-million cheque."I think all my colleagues were surprised it went to Siemens," said Deans. "I don't know when the money was awarded. We are in the middle of the biggest lawsuit in the city's history." Committee members were told during an in-camera session at the end of the meeting that the cheque has not yet been cashed.

Last June the consortium launched its $175-million lawsuit against the city. The consortium is alleging the lawsuit includes loss of profits it would have reaped on the project, which was given the go-ahead by city council in July 2006 but then cancelled after that fall's municipal election. River Coun. Maria McRae was equally surprised that the $1-million honorarium was issued to Siemens. "I'm surprised it wasn't reported," said McRae. "It should have been." McRae issued an inquiry at the end of yesterday's meeting asking staff for an immediate full breakdown of all costs. "Given the serious nature of this, council should be getting a quarterly report," said McRae. Several councillors questioned the awarding of some contracts yesterday after the Sun published a story about some of the expenses the city incurred in 2007. West Carleton-March Coun. Eli El-Chantiry said not enough information was supplied about contracts and what some of the money was spent on. "How do you expect council to be involved if we don't know the details?," he asked.
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Don Quixote Note: Compared to this Big City council and its talented bureaucrabs we have it comparatively more open and our back room shenanigans seem almost modest and parochial in retrospect. Our Honorariums now appear so insignificant in hindsight and the Dark Side meetings that our local Council indulge in could never be discussing sums of this magnitude.