City to revisit auction contract at special meeting

Herald file photo.

A contentious city contract is back up for debate as councillors prepare for their first meeting of 2019.

Council is set to hear presentations from two delegations regarding the City Auction Services RFP (request for proposal) when they convene for a special meeting on Monday, Jan. 7 at City Hall.

The first delegation does not list a lead speaker, although it does include an accompanying report written by City of Prince Albert purchasing manager Mike Lytle. The second presentation is from Eric Schmalz of Schmalz Auctions, the current holder of the contract, and one of four companies that bid on the new one.

City administrators had recommended awarding the contract to McDougall Auctioneers Ltd. at a meeting on Dec. 10. However that recommendation was not approved because council did not want the contract going to a business based outside of the city. McDougall has offices in several Saskatchewan cities, including Prince Albert, but is headquartered in Regina. Schmalz Auctions was one of two local bidders. According to administration, accepting McDougall’s RFP would save the city roughly $7,800 annually.

In a letter addressed to city council and included in Monday’s agenda package, Schmalz wrote that although losing the contract would not force him to close down, it would negatively affect their staffing.

“While the loss of the auction contract for the City of Prince Albert will unlikely cause the closure of our company, it will certainly have an impact on our employees who are also residents of Prince Albert,” his letter reads. “Schmalz Auctions and Schmalz Enterprises is committed to ensuring employment security for all our staff and we would be negligent if we did not take every opportunity to ensure the continued employment of each staff member.”

The new contract would run for two years, plus a one-year option, and allow the holder to conduct all auction services for the city. While the majority of city council wanted to see a local business get the contract, others were concerned the decision would have negative repercussions for Prince Albert businesses bidding on other contracts around the province.

Following the decision in December, Mayor Greg Dionne said he understood concerns about supporting local businesses. However, he also said local firms should be able to do the work at a lower cost.

“That’s a slippery slope because at the end of the day we’ve got to take care of the taxpayer’s dollars,” Dionne said after the December meeting. “I always question how can an outside firm be cheaper than an inside firm? These people have to travel from Regina, set up, do the advertising, do the sale, and you would think that our local guys would be cheaper than that … but sometimes it happens. (They think,) ‘well, it’s a city contract. They can pay.’ Then they up their fee a little and, in this case, they didn’t win.”