December 14, 2018

Yukon contractor says government shutting young people out of bidding process

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The Yukon government has thrown a wrench into a well-established system for helping small contracting companies break into the business, says Whitehorse contractor Clayton Thomas.

The issue stems from a contract to provide a portable classroom to Golden Horn Elementary School, just outside the city.

Thomas said it is a simple project that basically involved getting a double-wide modular trailer and “plugging it into the school.”

Previously, the government’s practice has been that contractors bidding on construction projects costing more than $1 million need to be bonded, which provides protection to the client. If the contractor doesn’t provide the service correctly, or within the specified time-frame, the territorial government would be able to file a claim with the surety company and be paid. It can also cover damage or theft.

Thomas said that provides assurance the project will be completed.

But he said contractors have been able to provide a 10% deposit on projects under $1 million instead of bonding.

That means a project costing $500,000 would require a $50,000 deposit, said Thomas. And even though the Golden Horn portable is costing around $500,000, the government wants it bonded, said Thomas.

“I guess theoretically the government being the owner has the right, maybe, to make a call on that, if they had a reason, but they have no reason on this,” he said.

The system has been in place for decades, he said, and there hasn’t been a problem.

Young contractors, however, who may have trouble getting bonded because they don’t have a well-established business or the means to do the paperwork that’s required, are not able to bid on the portable even though it’s an ideal project for a contractor starting out, he said.

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