Quote:
Originally Posted by Marcu
The CTA has essentially turned a blind eye to overwhelming evidence of bid collusion on several projects. When bids are coming in at 2 or 3 times over what was projected, there is good reason to investigate. The Grand reconstruction is a good example. Collusion is rampant in almost all municipal infrastructure, but not to this level. The markup is rarely this high.
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In fairness, the Grand reconstruction was bid out and awarded by CDOT, not CTA (CTA's last construction contract snafu was the Brown Line, which was generally agreed to be bad cost estimating by the consultant rather than greedy construction contractors). Construction costs in general have been skyrocketing, so high bids alone don't necessarily point to collusion. And similarly, why would companies collude on a low-bid contract? How do they agree which company gets to win the contract by bidding low? And after that agreement, why wouldn't the others, with that knowledge, just bid $1 less than the agreed upon amount, thereby winning the bid for an identical profit margin? The low-bid system is sound at combating the incentive to collude, in my opinion (in contrast to the negotiated contract procurement method, which incidentally is what they used in Madrid). However, sub-contractor selection is much spottier and much more prone to corruption, in almost any form of procurement other than having the prime- and sub-contractors bid on the contract separately. (The "general public" would probably flip out if they knew the details behind the DBE/MBE/WBE programs for contract awards). If there is any collusion, it would have to be taking place at the sub-contractor level. But frankly, these issues are outside CTA's control, so is it really fair to blame CTA Construction/Engineering/Law/Procurement etc for them? Those folks aren't the ones making the rules or political environment.
Good points on the artificially low cost estimates of Euro and Candadian projects, too.