08/15/2012 09:14 EDT | Updated 10/15/2012 05:12 EDT

Montreal to reject bids 15 per cent higher than price estimate

The City of Montreal will continue to sign work contracts with the lowest bidder, but a company could have its bid rejected if it offers a price that is 15 per cent higher than municipal estimates.

Montreal Mayor Gérald Tremblay made the announcement on Wednesday afternoon.

Tremblay said the work's importance, public safety and the well-being of Montreal citizens are at the heart of the decision, which, according to the mayor, will not require legislative changes.

"Montreal is Quebec's economic engine, [...] I cannot paralyze Montreal on the basis of allegations of collusion and corruption and other accusations," said Tremblay.

The mayor said he hopes that Bill 35, the law on how public contracts are granted, will be modified to let municipalities renegotiate with a lower bidder.

On the evening of the arrest of Tony Accurso, an entrepreneur accused of fraud, the city had suspended 14 contracts that were awarded to Louisbourg SBC — a company affiliated to Accurso — to "proceed to verifications."

City of Montreal spokeswoman Martine Painchaud said the city canceled four bids, three of which were affiliated to Louisbourg SBC. Companies will be able to offer new bids in their place.

Louisbourg SBC threatens to sue Montreal

According to Tremblay, the city received a formal letter in which Louisbourg SBC's lawyers threatened to sue the city.

The letter states "Louisbourg SBC [...] demands that the city respect the applicable laws and grants the expected contracts that were acquired by bid [...] [the company] will not have any other choice but to take appropriate judicial procedures in these circumstances."

'A climate of uncertainty'

The mayor said provincial politicians should "stop letting doubts drop about the elected representatives' integrity."

He reminded people that every elected representative must follow a code of ethics. Tremblay added that facts should be put forward — rather than allegations that create "a climate of uncertainty" and make the city's management more difficult.

The mayor, a former Liberal cabinet minister, said he demands that political parties clarify their position on Bill 35. He said he was "satisfied with the Liberal Party's engagements" and wants to fill in the holes in Bill 35.

"I don't want to hear 'We'll see' or [...] 'This is this, this is that.' Can we have facts? Can we talk about the real things?" said Tremblay.