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To: Chair and Members Corporate Services Committee Meeting on Tuesday, April 16, 2019 From: Anna Lisa Barbon Managing Director

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To: Chair and Members Corporate Services Committee Meeting on Tuesday, April 16, 2019 From: Anna Lisa Barbon Managing Director TO: CHAIR AND MEMBERS CORPORATE SERVICES COMMITTEE MEETING ON TUESDAY, APRIL 16, 2019 FROM: ANNA LISA BARBON MANAGING DIRECTOR, CORPORATE SERVICES AND CITY TREASURER, CHIEF FINANCIAL OFFICER SUBJECT: 2018 COMPLIANCE REPORT IN ACCORDANCE WITH THE PROCUREMENT OF GOODS AND SERVICES POLICY RECOMMENDATION That, on the recommendation of the Managing Director, Corporate Services and City Treasurer, Chief Financial Officer: a) As per the Procurement of Goods and Services Policy, Section 8.11 (c), an annual report of total payments where a supplier has invoiced the City a cumulative total value of $100,000 or more in a calendar year, BE RECEIVED for information (Appendix “A”); b) The administrative contract awards for Professional Consulting Services with an aggregate total greater than $100,000, as per Section 15.1 (g) of the Procurement of Goods and Services Policy, decentralized from Purchasing and Supply that have been reported to the Manager of Purchasing and Supply and have been reviewed for compliance to the Procurement of Goods and Services Policy, BE RECEIVED for information (Appendix “B”); c) The list of administrative contract awards for Tenders with a value up to $3,000,000 that do not have an irregular result, as per Section 13.2 (c) of the Procurement of Goods and Services Policy, BE RECEIVED for information (Appendix “C”); d) The City Treasurer, or delegate, BE DELEGATED authority to at any time refer questions concerning compliance with the Procurement of Goods and Services Policy to the City’s internal auditor. The City Treasurer, or delegate, is hereby further authorized to ratify and confirm completed awards or purchases between $15,000 and $50,000 where the City Treasurer or delegate is of the opinion that the awards or purchases were in the best interests of the Corporation. PREVIOUS REPORTS PERTINENT TO THIS MATTER Corporate Services Committee, June 19, 2018, Consent Item #2.8, Procurement of Goods and Services Policy Revisions Corporate Services Committee, May 29, 2018, Consent Item # 2.1, Restricted Acts of Council after Nomination Day and Voting Day Corporate Services Committee, April 17, 2018 Consent Item #2.3, Compliance Report in Accordance with the Procurement of Goods and Services Policy BACKGROUND The Procurement of Goods and Services Policy outlines the processes to be followed in order to obtain the best value when purchasing goods, or contracting services for the Corporation of the City of London. In accordance with the Policy, Managing Directors are required to submit an informational report no later than March 1st to the Manager of Purchasing and Supply containing the details of the informal quotation contract awards made under Section 8.5 (c) (i) and administrative contract awards made in their area to any Professional Consulting Service firms made under Section 8.5 (c) (ii) with an aggregate total greater than $100,000 in their respective Service Areas. For informational purposes, an annual report of total payments as per Section 8.11 (c) is also provided from the Financial Services area to document where a supplier has invoiced the City a cumulative total value of $100,000 or more in a calendar year. This report includes in the attached Schedule “A”, total amounts paid by the City during 2018 for expenses to a supplier in excess of the cumulative total value of $100,000. The total payments by supplier in Schedule “A” are listed in alphabetical order. This reporting requirement pre-dates the much more thorough annual compliance reporting that has been provided to Council since 2010. The decentralized, administratively awarded Professional Consulting Service contracts that are aggregately greater than $100,000 as per Section 15.1 (g) appear in Appendix “B”. These awards were made in compliance with the Procurement of Goods and Services Policy. Administratively Awarded Tenders with a value up to $3,000,000 as per Section 13.2 (c) that do not have an irregular result are shown in Appendix “C”. When irregular results arise during the procurement process, those procurements follow section 8.10 of the Procurement of Goods and Services Policy. The Procurement of Goods and Services Policy (current revision dated June 26, 2018) identifies spending thresholds and associated Procurement processes as per Schedule “A”, which is shown in Appendix “D”. It should be noted that in 2018 during the Municipal Election period, the City Manager was delegated authority by Council to act on their behalf for that time period. There was one procurement awarded that required the City Manager to exercise that authority during this period. It was RFP18-22 for Request for Proposal - Design, Construction and Operation of an Indigenous-Led Licensed Child Care and Family Centre, as per agenda item 2.9 of the Community and Protective Services Committee on November 13, 2018. Purchases Between $15,000 and $50,000 Methodology The data for 2018 purchases between $15,000 and $50,000 was directly extracted from the accounting system General Ledger report for items that did not have Purchase Orders. This is the same process (the value previously was $10,000 to $50,000) that was used for the 2017, 2016, 2015, 2014 and 2013 reporting. This has been reviewed by the Manager of Purchasing and Supply for comparability to the Procurement of Goods and Services Policy. There were some minor items identified as a result of our review; all of these issues have been reviewed by the client Service Areas for root cause analysis, and corrective actions are being implemented by the Managing Directors. The amount of issues continue to be significantly reduced and are lower than those issues experienced in 2017 and are the lowest to date of this reporting. Specifics of the issues have been communicated in each area and additional training has been provided, which will prevent future re-occurrences. The City Treasurer or delegate will be able to identify and authorize any purchases that meet this criteria and can act on any items that may require internal audit attention. Procurement Controls The Procurement Process is controlled at every step beginning with monetary spending limits, authorized documentation to commence procurement and clear processes for soliciting bids at various authorization limits. Awards are clearly documented both administratively and by City Council. The process is documented and subject to audit, noting that in 2018 a procurement process assessment was undertaken by Deloitte with findings identified to Audit Committee. Furthermore, in 2018, the City implemented eProcurement which further “error-proofs” the bidding process and provides a digital audit trail that also further improves efficiency and effectiveness of resources while standardizing our processes. This annual report provides an in- depth review of various types of procurement and spending levels. It is a continuous improvement tool designed to demonstrate the City’s Mission for transparency, fairness and competitiveness in public procurement. Scope of Responsibility This review is limited to the City of London only and does not include Boards and Commissions procurement. Acknowledgements This report was prepared by John Freeman with the assistance of Melissa McErlain and the Financial Business Support Team: Manish Anjani, Janice Brown, Gail Devito, Douglas Drummond, Debbie Gibson, Laurie Green, Lisa Karlovcec, Lisa MacInnis, Janice Verhaeghe, Annette Ripepi, and Steve Whitmore. SUBMITTED BY: CONCURRED BY: JOHN FREEMAN, CSCMP, LSSGB IAN COLLINS, CPA, CMA MANAGER, PURCHASING & SUPPLY DIRECTOR, FINANCIAL SERVICES RECOMMENDED BY: ANNA LISA BARBON, CPA, CGA MANAGING DIRECTOR, CORPORATE SERVICES AND CITY TREASURER, CHIEF FINANCIAL OFFICER Attachments: Appendix “A” – List of Suppliers > $100K Annual Spend, Section 8.11 (c) Appendix “B” – List of Appointment of Professional Consulting Services, Section 15.1(g) Appendix “C” – List of Administratively Awarded Tenders < $3M Section 13.2 Appendix “D” – Schedule “A”, Procurement of Goods and Services Policy APPENDIX "A" 2018 Payments Sorted by Supplier as per Section 8.11 (c) Payee Name Total 2018 Payment Attributed to Water 2017 Amount Increase/ Boards (Decrease) 1724830 ONTARIO INC. O/A FLANDSCAPE $ 345,833.11 $ 345,833.11 1781991 ONTARIO INC. $ 105,835.77 $ 105,835.77 1865522 ONTARIO INC. O/A BYRON WOODS $ 357,085.34 $ 357,085.34 2047790 ONTARIO INC. $ 279,171.84 $ 109,267.53 $ 169,904.31 2190876 ONTARIO INC. (SAGECOMM) $ 129,772.84 $ 129,772.84 2219008 ONTARIO LIMITED $ 1,734,665.63 $ 1,734,665.63 2376378 ONTARIO CORP. $ 6,752,584.05 $ 4,578,750.45 $ 2,173,833.60 2380560 ONTARIO INC. $ 116,758.83 $ 116,758.83 291 CONSTRUCTION LIMITED $ 1,886,939.57 $ 359,707.73 $ 1,527,231.84 390 BURWELL ST./HOMES UNLIMITED(LONDON) $ 127,739.00 $ 122,013.00 $ 5,726.00 4M SERVICES $ 237,955.98 $ 122,896.54 $ 115,059.44 50 PLUS HOUSING CO-OPERATIVE $ 268,698.86 $ 321,093.55 $ (52,394.69) 700 KING EAST HOLDINGS LIMITED $ 823,475.98 $ 823,475.98 700 KING WEST HOLDINGS $ 848,490.16 $ 848,490.16 700531 ONTARIO LTD. $ 2,126,026.67 $ 153,651.44 $ 1,972,375.23 785 WONDERLAND ROAD INC. $ 538,626.26 $ 538,626.26 a+LINK ARCHITECTURE INC. $ 131,534.59 $ 184,618.60 $ (53,084.01) AAROC AGGREGATES $ 338,158.62 $ 356,492.43 $ (18,333.81) ACCERTACLAIM SERVICORP INC. $ 737,658.50 $ 771,432.13 $ (33,773.63) ACCURATUS DESIGN & BUILD INC. $ 2,330,477.14 $ 2,330,477.14 ACE OF SPADES $ 185,665.20 $ 1,501.77 $ 135,573.55 $ 50,091.65 ACHIEVA HEALTH $ 260,414.23 $ 249,461.48 $ 10,952.75 ACORN CHRISTIAN DAY CARE $ 368,523.18 $ 269,630.85 $ 98,892.33 ACROSS LANGUAGES $ 147,651.81 $ 154,667.32 $ (7,015.51) ACUSHNET CANADA INC. $ 168,972.16 $ 127,036.26 $ 41,935.90 ADDICTION SERVICES OF THAMES VALLEY $ 696,320.58 $ 1,765,374.99 $ (1,069,054.41) ADELAIDE NORTH DEVELOPMENTS INC.
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