Cue the circus music

The long, strange saga of the Telus Park naming rights deal for B.C. Place Stadium won’t end.

How did it start?

We know that the stadium wasn't finished in time for the Sept. 30, 2011 reopening, but the show went on anyway.

Telus crews, under the guise of the top secret "Project Frog," were in and out of the construction site throughout the summer to install the wi-fi and mobile phone antennas and video screens, but often had to hurry up and wait. B.C. Pavilion Corporation and PCL Constructors Westcoast had other priorities. The application of the fabric roof was way behind schedule, delayed from February to July because the Quebec steel contractor Canam and French cable installer Freyssinet couldn't get along and cables and machines were failing or breaking.



The reopening came and went. So did the marquee event, the 99th Grey Cup. The name remained B.C. Place Stadium. Telus had incurred extra costs and the value of the naming rights had diminished. It reasonably wanted a better deal than the one originally agreed.

Meanwhile, the B.C. Liberal Party ended 2011 with its "Risky Dix" attack ad campaign and began 2012 by soliciting various frequent donors to build a war chest for the Port Moody and Chilliwack by-elections. Telus, which gave $352,407.35 since 2005, declined.

The Liberals were miffed after awarding Telus the $1 billion, 10-year omnibus telecommunications contract in summer 2011 in controversial fashion.

The Liberals were hammered by Telus competitors, chiefly Bell, Rogers and Shaw, who accused the government of violating trade agreements and government procurement rules. The tendering process for nine different contracts lasted more than two years before the government's sudden, surprise bundling of the entire business into one deal, for one company.

Despite the party's ties to Telus, Premier Christy Clark has telecommunications connections of her own.

Not only is Clark a good friend of Bell-sponsored, Vancouver Whitecaps' owner Greg Kerfoot, but she was formerly employed as a CKNW radio talkshow host by Corus Entertainment, a company controlled by Shaw Communications.

In fact, Clark met on Jan. 30 in the Premier's Vancouver Office at the World Trade Centre in Canada Place with Shaw CEO Brad Shaw.

Shaw Communications is contesting Telus’s application to trademark Optik TV. Shaw also owns Global TV, which boasts the best-rated local TV newscast in Canada on Global BC.

As if to make matters worse, Telus is suing the B.C. government. Deputy Minister of Finance Peter Milburn denied Telus's appeal for a Social Service Tax refund on Feb. 7, according to the March 9-filed B.C. Supreme Court documents below. Telus claimed it errantly paid or self-assessed $306,311.61 in taxes after the 2004 purchase of servers, operating software and maintenance from IBM, Lucent and Sun Microsystems. At least $96,580.40 was not refunded and remains in dispute.

Telus sues B.C. government for a tax refund

While Clark has been noticeably quiet during a week-long break from the Legislature (after mis-handling the mess and message the previous week), some Liberal MLAs have used their time off to arrange photo opportunities with community newspapers to dole funds from a $30 million pot Clark announced at the Union of B.C. Municipalities convention on Sept. 30, 2011 in Vancouver.

MLAs Randy Hawes and Marc Dalton went to Mission to announce $185,000 for dehumidifiers at the Mission Leisure Centre’s three rinks. Hawes and Dalton told Abbotsford Times reporter Christina Toth that the money was left over from the stadium’s renovation!

MLAs Randy Hawes (Abbotsford Mission) and Marc Dalton (Maple Ridge Mission) met with the district's mayor Ted Adlem and Coun. Nelson Tilbury at the leisure centre to hand over the cheque.

The largesse comes from monies left over from the $563-million renovation of the B.C. Place roof. When the project came in $30 million below the last estimated cost, Victoria decided to disperse those dollars to recreation projects around B.C., explained Hawes.

"We just got the information on the weekend," he said.

Preposterous! Minister responsible for B.C. Place Pat Bell told me in a Jan. 30 interview: “We’re probably three or four months away from being able to roll out the final numbers.”

"For them to claim this is surplus money from a project millions of dollars over budget is a real stretch," NDP critic Spencer Chandra Herbert told me. "There is no surplus because they have no financing plan to pay for the project."

UPDATE, 5 p.m., March 22: Hawes claims "we are under the final budget for the stadium refit" (though he didn't mention any numbers). But he goes on to say:

"I either misspoke or was misunderstood. The recreation funding of $30 million for more rural communities is not from the under budget amount from BC Place. That was capital funding and from an accounting perspective, this funding must be from operating funds. I have looked at this funding as a way to allow some communities that might not benefit from the stadium remake to feel they have some benefit. I do feel a bit foolish having tied the funding directly to the under budget amount on the stadium. Incidentally, while the total recreation grant funding is $30 million, that does not mean the stadium savings was $30 million. Mea culpa."

UPDATE, 7 p.m., March 22: I asked Hawes for proof that the B.C. Place project was under budget. Not surprisingly, he has none.

"I don't know what the numbers are but Pat Bell has said numerous times that we are under budget. I believe the final numbers are still to come in."

Work continues at the stadium. A new fence is being erected outside the west side service entrance. The level 1 media entry is under renovation (and wasn’t complete for the Whitecaps’ home opener).

This is the same stadium that is now faced with a $35 million to $40 million shortfall because of the nixed Telus naming rights deal. The same stadium where an operating deficit of $49 million has been forecast for 2012-13 to 2014-15, according to the latest Service Plan.

The same stadium where grease leaks from the support cables have damaged the roof and could cost $10 million to repair.

The same stadium that will be the subject of an 85-day B.C. Supreme Court trial expected to begin in October 2013 between Canam and Freyssinet. Canam is suing for $26.15 million, Freyssinet wants $6.5 million. B.C. Pavilion Corporation is a defendant in the Freyssinet lawsuit.

Here's my modest proposal: move the B.C. Liberal caucus and its staff under the expensive big top at B.C. Place. They are clowns, who are running this province like it’s a circus.

Cue the circus music.

Another billion-dollar B.C. dilemma

Did the British Columbia government botch another billion-dollar deal?

Some of the biggest companies in Canada think so. Could this ultimately be at the root of the cancellation of the Telus naming rights deal for B.C. Place Stadium?

Bell, Rogers and Shaw have accused the B.C. government of unfair tendering practices. They allege that the direct award of the government's $1 billion, 10-year long distance, voice, data and mobile phone service contract to Telus violates national and international free trade agreements and even the government's own regulations!

Taxpayers, they say, got the shaft.

While Telus is the biggest private sector employer in B.C., it just so happens to be one of the biggest corporate donors to the B.C. Liberals. Elections B.C. shows Telus gave $352,407.35 since 2005. Premier Christy Clark supporter Stockwell Day, the former senior federal Conservative cabinet minister, is on the Telus board of directors. Clark appointed Day (photographed below) to the B.C. jobs and investment board and immigration task force.



This is what happened. The government issued a Negotiated Request for Proposal for its Strategic Telecommunications Services Procurement Project on Dec. 22, 2008. Just over two-and-a-half years later, the government suddenly halted the process of tendering nine "bundles" of work, took a 180-degree turn and gave Telus the whole enchilada, as they say, on June 29, 2011. The government and Telus have spun this as an economic generator that will improve mobile phone service and Internet access in rural B.C.

"When Telus was the successful bidder on all nine individual bundles of services in the NRFP as well as on the total package of combined services, it became clear to government that, instead of awarding the bundles separately, a stronger partnership with Telus could realize a greater overall benefit to families and businesses in B.C." says the news release.

The deal includes a two-year renewal option, so Telus could make $1.2 billion by the end of the term. Unsuccessful bidders had until July 13, 2011 to file complaints and, boy, did they ever!

A political party, whose name was not disclosed, obtained the vendor complaints after filing a Freedom of Information request to the Ministry of Labour, Citizens Services and Open Government. The 189 pages of information were posted online March 9, 2012. Download them all here.

It is easy to dismiss this as sour grapes by sore losers. But it is not so simple. Read the whole file and you will quickly notice a pattern. Companies, big and small, feel they were treated unfairly by the B.C. Liberal government. Yes, that's the same party that controversially sold B.C. Rail to CN Rail and part of B.C. Hydro to Accenture. The former deal was the subject of a massive government corruption scandal that dominated the news for the better part of a decade. Clark was deputy premier at the time and has steadfastly refused to order a public inquiry.

Her leadership campaign mastermind Patrick Kinsella was involved in the B.C. Rail and B.C. Hydro deals. There is no evidence that he had a hand in the Telus matter. Yet.

So, put aside the matter of the allegedly oversized sign, the laughably "iconic" B.C. Place name or the "not the best deal for taxpayers." Those were lines peddled by the deer-in-the-headlights Premier, her Finance Minister Kevin Falcon and Jobs, Tourism and Investment Minister Pat Bell as they tried to explain away kiboshing a $40 million contract and breaking a promise to taxpayers.

Did the B.C. government cancel the Telus naming rights for B.C. Place (directly or indirectly) to distance itself from Telus, for fear of its competitors filing lawsuits and complaining to international trade tribunals?

Consider the following excerpts of complaints to government:

Mario Belanger, senior vice-president of sales, Bell Canada:

"Bell believes the implications of this decision reach well beyond the Ministry in charge of the NRFP. The decision has serious implications with respect to provincial, inter-provincial, national and international trade policy and existing and future trade agreements. The decision runs contrary to the Province's Agreement on Internal Trade (AIT) and Trade, Investment and Labour Mobility Agreement (TILMA) commitments. The decision is based in part on an assessment of Telus's capabilities as the only provider who could ofter the services.

"This assessment is not consistent with the regulatory framework for telecommunications in Canada, and has not been tested by a competitive bidding process. The decision runs contrary to the duty of fairness owed to all bidders participating in a competitive procurement process.

"The decision will have a material adverse effect on the availability of competitive communications services in the Province for consumers, small businesses, governments and enterprises.

"In addition to contravening international and national agreements, the Province has also breached its own Core Policy and Procedures Manual.

Jean Brazeau, senior vice-president of regulatory affairs, Shaw:

"Once the B.C. Government determined its own procurement process was not going to prove satisfactory, the entire procurement process should have been cancelled. Then the B.C. Government would have been free to retender for services under a new procurement process that allowed for companies to explore various options such as forming consortiums.

"The lack of an open and transparent procurement process reduces the B.C. Government's ability to ensure the best value for taxpayers. In addition, extending the scope without prior notice eliminates the opportunity of the B.C. Government to evaluate the benefits of future technological innovation, lower costs, or investment that could be provided by Shaw, or a consortium of industry bidders. This limits the B.C. Government to only the services and hardware of one vendor.

"Shaw objects to the fact that it took a two-year procurement process to arrive at NOI #4015, and then only two weeks were allowed for filing objections to this process."

Gordon LaFortune, Gottlieb and Associaties, lawyer for Rogers:

"The size and scope of the contract awarded to Telus is extraordinary. As a result of this award, Telus would be the sole provider of telecommunications services to the Province of British Columbia for 10 years. The range of services and covered government entities is so broad that no other supplier, including Rogers, would be permitted to provide telecommunications services during the currency of this contract.

"At the end of this period, Telus would have such an overwhelming advantage as the incumbent supplier that it is unlikely that it could be displaced even if the province put the telecommunication requirement out to tender. Therefore, by awarding such an extensive contract to Telus, the Province effectively grants Telus the contract in perpetuity."