The awarding of a contract to a Northwest Territories company by the Yukon government involving work on the territory’s new French-language high school is raising eyebrows – and concerns – among some Yukon businesses.

That’s according to the Yukon Chamber of Commerce. It explained last Friday that while it’s “generally pleased” with the government’s efforts so far to keep work local, the latest move to contract an Outside firm has caught it off-guard.

Peter Turner is the chamber’s president. As an advocate for Yukon businesses, he said last Friday, “obviously I’d always rather see business go to the Yukon” and not an Outside organization.

What Turner was perhaps referring to included in part the Liberal government’s 2016 election platform.

Premier Sandy Silver’s mandate letter to Highways and Public Works Minister Richard Mostyn, for instance, emphasized in part the need to recognize “local needs, local interest and local solutions.”

The January 2017 letter goes on to mention that in the near term, the department and minister be focused on delivering key goals – the first of which is listed as increasing “the ability of local businesses and First Nations to secure government tenders.”

With this awarding of the bid to an Outside company, though, that solution may not be achieved by a local firm.

“So this catches us a little bit by surprise, quite frankly,” Turner said.

Yukon firm Kobayashi and Zedda Architetics (KZA) was initially granted part of the contract which would have involved overseeing the design and construction of the building.

KZA won the bid through a public process after bidding just under $200,000. The scope of the work then changed, and the government and KZA were unable to come to an agreement on the price.

But after learning that Yellowknife-based Taylor Architecture Group (TAG) had been awarded the work at a cost of $904,086 by the territorial government, it piqued the firm’s interest.

A department spokesperson, meanwhile, admitted that the price was not a minor one.

Scott Milton is the assistant deputy minister with the department. He explained that the contract had received approval by the department’s deputy minister Jaime Pitfield.

Defending the decision, Milton told the Star today it was made in efforts to save the bigger and better works for Yukon businesses – which are now out for public tender, he noted.

“Part of our thinking in using the N.W.T. firm was to allow Yukon firms the best and broadest opportunity to actually compete in construction project itself,” he said.

Plus, he added, TAG was a qualified body on a list of about 35 firms – a list that included some local businesses, he said.

That list is updated every couple of years or so, he added.

Milton also clarified that it was in fact not awarded through a sole-source contract, instead a competitive standing offer agreement (SOA).

Sole-source contracts, he explained, have “no competitive element to it at all.” SOAs, meanwhile, are offered after compiling a list of qualified firms which compete to be on that list.

Clarifying that the bid was done though an SOA and not a sole-source contract, Milton said there is no cap on how much can be spent when it comes to SOAs being awarded (whereas sole source contracts have a limit of $250,000).

A department spokesperson, though, confirmed this afternoon that that limit is used as a “guideline” for both SOAs and sole-sourced contracts.

Once more than that $250,000 amount is involved, officials are to notify their deputy minister, who must sign off on it.

Doris Wurfbaum, a communications and public relations analyst with the department, confirmed Milton’s statement that approval had been received by the “deputy authority” (Pitfield).

Still, as this wasn’t a sole-source contract, Milton maintained that that cap was not relevant.

He could not speak to whether it was possible there were Yukon companies who would only be interested in applying for the smaller-scope work anyway and choosing to opt out of applying for the larger construction work – by their own accord.

It came after the territory’s opposition party issued a release last Friday. The Yukon Party’s interim leader, Stacey Hassard, said in the release it is alarming that the government was “making business decisions on behalf of contractors instead of allowing them to decide for themselves.”

Hassard continued, calling it “insulting to Yukon’s hardworking private sector,” especially as the government has said they want to be out of the business of doing business.

That was a significant consideration, as Milton said the decision indeed worked in favour of Yukon businesses.

He explained the government often has three options to award such bids: most projects go through a public tender process, while some are considered for the SOA process and others for sole-source.

“Within our contracting directive, that’s not a direct award,” and therefore not a sole-source contract, he assured. “It’s a competitively-awarded contact.

“Normally, we would tender for smaller amounts,” he said: “In this case, given our options available to us, we chose to do it through SOA.”

Part of that had to do with the timelines associated with the projects, as the government hoped to have it awarded by late this summer, he noted.

“It’s fully within our roles and directive to do that.”

Meanwhile, Turner said it was important to consider the bigger picture of moves like these.

“There’s a fine balance I think that still needs to be fully worked out,” he said of the government’s commitment to supporting local businesses ­– and the extent to which that can conflict with awarding works to outside-Yukon firms.

As an advocate for Yukon businesses, though, the chamber is always concerned with “maximizing opportunities in procurement,” he said.

Turner added he is likely to meet with the Yukon Contractors Association sometime this week after it received a formal complaint from one of its members a number of weeks ago.