PC’s fast-tracked LTC construction plan prompted new procurement process at Infrastructure Ontario

By Allison Smith December 16, 2020

The PC’s summer pledge to get four new long-term care homes built at record pace spurred the creation of a brand new Infrastructure Ontario procurement model.

In July, the Doug Ford government announced a new funding model for LTCs whereby the province covers more of the upfront cost of construction. Within weeks, the premier promised new homes in Ajax and Etobicoke and two in Mississauga, all of which are expected to be fully constructed by 2022.

In order to move from procurement to completion in less than three years, Infrastructure Ontario developed a fast track for wannabe developers, which involves no public short list of bidders and simultaneous closed-door contract negotiations.

Under its traditional model, Infrastructure Ontario undertakes the following steps before signing off on a P3 project: issuing a Request for Qualifications, releasing a short list of three or five firms, soliciting a Request for Proposals from that list, selecting and announcing a preferred bidder, then negotiating a final contract and releasing a cost estimate.

Now, taxpayer-funded infrastructure deals can be inked in just two steps. First, a Request for Qualification and Standing Offer (RFQSO) is issued, then multiple firms are invited to enter into confidential meetings and negotiations. The winning bidder will only be announced once a final contract has been signed.

The firms selected to construct the four new LTC homes are expected to be revealed by early January.

The RFQSO is used to prequalify bidders who have the capacity to undertake rapid “modular construction” and design, according to a spokesperson for Infrastructure Ontario. The system also encourages “accelerated construction methods, project controls and program management.”

The so-called “Rapid Procurement and Delivery Program” has already been taken up by the Ministry of the Solicitor General.

Infrastructure Ontario is currently considering bids for a new “Segregation Capital Program” that aims to have new modular facilities constructed on the sites of the Thunder Bay Correctional Centre and Kenora Jail by April 2022.

Speaking on background, a government official described the “Segregation Capital Program” as an “unfortunate name” for the corrections expansion. They maintained the new modular builds will “augment” existing facilities to address overcrowding until the long-delayed Thunder Bay Correctional Complex is constructed (there is still no timeline for the $1-billion project’s completion), but they won’t primarily be used to house more segregation units.

The funding for the modular prison buildings will come from a $500-million money pot announced by Solicitor General Sylvia Jones in June, which is also allocated for increasing staffing levels in corrections facilities across the province. The government could not provide a cost estimate for the expansions, saying it will depend on what the private companies who bid on the project bring to the table.

The procurement process for the expanded correctional facilities began in November and is scheduled to conclude by March, per Infrastructure Ontario’s latest P3 Market Update.

The agency said it will continue to use its traditional procurement model for large, complex infrastructure projects such as transit systems, highways and acute care hospitals.