Manitoba NDP 'bullied' flood-hit communities to go with 1 security firm, critics say

Manitoba's NDP government is being accused of directing rural municipalities to hire one specific company for flood-related security in contracts worth of million of dollars.

Former reeve says his municipality was 'bullied' into using Impact Security's services

Manitoba's NDP government is being accused of directing rural municipalities to hire one specific company for flood-related security in contracts worth of million of dollars. 1:54

Manitoba's NDP government is being accused of directing rural municipalities to hire one specific company for flood-related security in contracts worth of million of dollars.

The Progressive Conservatives alleged on Friday that they have "uncovered dozens" of contracts totalling $16 million, directed to Impact Security Group for flood zone security.

The Tories also claimed that the New Democrats "pressured a number of communities" to hire and stay with Impact Security, despite concerns from some municipal officials about poor service and high wages.

Their claims are disputed by Impact Security, while Steve Ashton, the minister responsible for infrastructure and emergency measures, said municipalities, not the government, made the decision on what company to hire.

The new allegations come after the NDP came under fire over an untendered contract it tried to issue for flood-fighting equipment in 2011.

PC Leader Brian Pallister claimed that some municipalities were bullied when they considered going with a different company.

"They were told that if they switched providers that they would get a lower percentage of compensation than if they didn't. This is not on. This is not right," Pallister said Friday.

"Something smells here and I think we need to get to the bottom of it."

The PCs allege the province failed to disclose $16 million worth of untendered contracts for flood zone security with Impact Security on a government database.

But CBC reviewed the supporting documents the Tories used to make the claim, and found only around $850,000 worth of contracts were directly between Impact Security and the Government of Manitoba.

A provincial spokesperson said that was not even for work done for EMO but for other government departments.

The remaining amount — approximately $15 million — were expenses incurred by flood-affected municipalities that hired security companies. Impact Security was the company that was paid nearly all of the $15 million.

The documents, which were obtained through a Freedom of Information request, appear to indicate that more than 60 contracts (with a combined value of $850,000) between the province and Impact Security were originally missing from the database.

However, the PCs failed to explain why they believe the contracts between the RMs and the private companies should appear in the province's expense statements.

'Bullied? Absolutely,' says former reeve

The rural municipalities of Woodlands, Coldwell and St. Laurent confirmed that Impact Security did work in their community, on the advice of the province, around the time of the 2011 flood.

Earl Zotter, the former reeve of the Rural Municipality of St. Laurent, said his RM spent close to $9 million for flood security services in 2011.

He said the province intimidated officials when they raised the possibility of using another security company. 

"You're told that your cheques might not be coming as quickly ... if you've got someone else; there's nothing guaranteed that they're going to be covered, that the RM is going to be on the hook," he said.

"Oh yeah, bullied? Absolutely."

Zotter said it had fired Impact Security twice because of concerns about employees sleeping on the job, not paying attention, and not being able to communicate in English. However, he said a provincial government employee went to the RM and "she would be bullying us and saying, 'Well, you have to hire them back. You won't have coverage.'"

Another RM had concerns about Impact

Nicole Christensen, the chief administrative officer with the Rural Municipality of Coldwell, she was also concerned about the quality of services provided by Impact Security, citing issues such as employees sleeping on the job.

"There were times we weren't happy," she said.

Christensen said the RM was not pressured into hiring Impact Security, but it went with the company on the advice of the provincial government, which said that if all municipalities went with one provider, the payments and paperwork would be processed more quickly.

The RM of Coldwell paid the company a total of $1.9 million for flood security services between June 13, 2011, and Dec. 20, 2011. Christensen said the province delivered on its promise to pay back the RM quickly.

Christensen added that her RM later hired local people to supervise the Impact Security employees to prevent the problems they had experienced, and that cost was covered by the government.

RM of Woodlands reeve Trevor King, who was deputy reeve in 2011, said his community hired Impact Security for a couple of weeks after the flood but was dissatisfied with the work. He said they hired another company and had no problem getting funds from the province to cover the cost. 

Impact Security responds

Impact Security owner Ron D'Errico and corporate affairs director Chris McCoy told CBC News they take issue with the Tories' allegations, including the $16 million that the party claims was paid to the company.

The pair called the dollar figure "totally inaccurate" and said Impact had "eight or nine contracts" to provide security after the flood, not the "dozens" that the PCs claim.

One of the contracts was for only three days in the Rural Municipality of St. Clements, they added.

D'Errico and McCoy said the company has previous experience in handling floods in 2007 and 2009, which was why it was hired in 2011.

The company also noted that Derek Johnson, another former St. Laurent official who has spoken out against the province for its handling of the security contract issue, is now a candidate for the Progressive Conservatives in this spring's provincial election.

The pair added that the RM of St. Laurent had to re-hire Impact Security because no one else could provide the service.

In the RM of Coldwell, the company officials said local supervisors were hired not to monitor the effectiveness of Impact workers, but to help diffuse potentially volatile situations in the flood zones.

D'Errico and McCoy said if there were any complaints about Impact's employees, they were dealt with or the workers in question were removed.

Province says contracts were municipal 

The NDP denies it intimidated flooded communities in 2011.

On Friday, Ashton said Pallister does not understand that the contracts in question were from municipalities, not the government, and the municipalities made the decision about which company to hire.

"These were municipal contracts. He clearly doesn't understand that," Ashton said of Pallister.

"He needs a briefing, and he doesn't just need a briefing just from myself. The bottom line here is these were contracts that were put out by the municipality."

Ashton said the province's priority was that homes and valuables be protected.

Ashton would not discuss whether the province told municipalities Impact Security was the only option and wouldn't comment on whether the contracts were worth $16 million, as the Tories allege. 

Follows Tiger Dams controversy

The Tories grilled the NDP last year over a $5-million untendered contract it had tried to award to another company to purchase flood-fighting tubes known as Tiger Dams.

The Tiger Dams controversy erupted after a whistleblower alleged that Ashton was in a conflict of interest when his department awarded the contract to a company represented in Manitoba by a friend of the minister.

An investigation by the provincial ombudsman found that civil servants were directed to waive the competitive tendering process for the purchase of Tiger Dams in 2014 for the Interlake Reserves Tribal Council.

The report also found that Ashton directed staff to prepare a submission recommending the purchase, and senior civil servants had expressed concern about the government's plan.

After the ombudsman's report was released earlier this month, Ashton said he was simply trying to secure needed equipment for flood-prone First Nations communities, but he added that he had learned from the situation.

With files from the CBC's Meagan Fiddler and Jacques Marcoux


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