Two companies hired to bring high-speed internet service to rural Nova Scotia did not submit the lowest bids, CBC News has learned.
Aliant lost the contract despite bidding millions of dollars less than EastLink and Seaside Communications, according to documents obtained under the province’s Freedom of Information law.
The EastLink-Seaside bid totalled $25 million and covered all areas out of the province outside the Halifax Regional Municipality.
Aliant, on the other hand, submitted a bid for $8 million to cover all but the Halifax region and Cumberland County. It also made a second bid for $13.7 million, depending on how the contract was awarded.
Mary Jane Fumerton, a government spokeswoman, said the Aliant bid covered only 85 to 90 per cent of the province. She also said cost was only a small factor 20 per cent in the decision.
“The other 80 per cent involved demonstrated experience, a test project, their business models and sustainability,” she said. “Money is definitely important, but the longevity of this, the sustainability of it, is equally important.”
The contract to bring broadband to 200,000 people in rural areas was awarded in 2007. The federal and provincial governments have allocated $75 million to the project, while Seaside and EastLink are spending $40 million of their own money.
Seaside’s zone covers the province’s nine northern counties and EastLink has the southern half.
The two companies missed a December deadline, but Fumerton said they are expected to have the job done in May. Seaside, however, recently told CBC that it expects to have towers up by the end of summer and full service by the end of the year.
There is a lot on the line. The companies stand to pick up customers as homes and businesses are hooked up. Under the agreement, they’re not allowed to bill customers more than $50 a month for the next five years.
The Department of Economic and Rural Development would not provide CBC with the details of the Aliant bid for two years, claiming that would reveal personal information and possibly harm the company’s ability to compete.
Recently, the province’s freedom-of-information officer ruled that the government could not withhold the information.
Charles Cirtwill, CEO of the Atlantic Institute for Market Studies, finds it disturbing that the government would hide the numbers from taxpayers. Without that, he said, no one can tell if government contracts are awarded fairly.
“It shouldn’t take the public or reporters a year or more to get this information. It should be very clear when the decision is made, ‘We’re going with this company. They are not the lowest bidder, but we believe we are getting quality or additional benefits in these kinds of areas,'” said Cirtwill.
Aliant is saying little about the matter.
In an email to CBC, the company said: “We were disappointed not to be chosen as the winning bid. Beyond that, we have no further comments on this particular contract but we will continue to respond to future contracts with what we believe to be fair and equitable products and services.”
Aliant would not say whether its bid included its own financial contribution.