Public procurement

Millions of the City Hall “buried” in 41 yards in Chisinau

Loc de parcare șos.Hâncești 58 și 58/1 CIJM
Author: Julieta Saviţchi
12/01/2016 10464

The arrangement of some yards in Chisinau and  creation of some thousands parking spaces, which the mayor Dorin Chirtoaca praised in the summing up for 2015, cost 53,3 million lei, an unjustified sum, say experts. Moreover, the purchasing agreement of these works was concluded with some procedural violations.

The agreement signed between the City Hall and the company that performed the works, Lucet-comert is unclear. The document does not stipulate the exact number of yards and parking spaces to be arranged and does not show the addresses where the works are performed. Though this company has not fully completed its commitments stipulated by the agreement, the period of the agreement was extended and some millions were provided to continue the works in current year.

Agreement with many question marks

The contest for yards’ arrangement and enlargement of parking spaces was organized by the General Division for Public Transportation and Communication Means of the Municipal Council Chisinau (DGTPCC). The public tender was held on July 7 2015. Three enterprises participated in the tender: SA Edilitate, (that proposed a sum 39 million 333 thousands lei), municipal Enterprise Exdrupo (38 million 567 thousands lei) and Lucet-comert SRL (31 thousands 674   lei). SRL Lucet-comert was designated the winner because it proposed the lowest price.  

The tender book issued by the applicant provokes many questions. Thus, the document does not clearly stipulate the addresses of the yards which were supposed to be arranged and the place where the parking spaces were supposed to be expanded. Instead, the tender book included a list of works such as mechanic scarification of land, mechanical earth excavation, manual digging, scattering earth, works of unloading the land in the deposit, etc. "Our goal was that many yards benefit from these works. We will have to work a long period of time", explained Igor Gamretki, head of DGTPCC.

The agreement between DGTPCC and SRL Lucet-comert was signed 2 days before the tender was organized - on July 9. The document stipulated that the cost of the works performed by SRL Lucet - comerţ  amounted 45 million 870 thousands lei, with included VAT. Lucet-comert committed itself to complete the works by December 31 2015. A fine of 0,5%   of the uncompleted services was set for delayed works.

Official documents show that Lucet - comert failed to complete the works in set terms and  under the sum of money stipulated by the agreement, so thus, on November 19 2015, the sides signed an additional Accord to the Agreement no.28/15, by which its value was increased by 13 million 751 thousands lei. Also, the term of works execution was expanded by about 7 months, to July 15, 2016.  Oleg Caraman, head of service within DGTPCC explains the expansion of the agreement by the fact that other prices were requested to be included in the project. Lucet - comert will perform works of yards and parking spaces arrangement within 2016. To this effect, additional financial means from the budget will be earmarked”, said the official.

The informative note on the value of works executed within December 2015, presented by Lucet-comert to the General Division of Public Transportation and Communication Means shows that in the last month of the agreement, the enterprise performed works on 19 addresses and the cost reached 14 million 528 thousands lei. The document shows that in all, in 2015,  Lucet-comert performed works estimated at 53 million 520 lei, DGTPCC got the works on 41 addresses. Thus, the document shows that within one month, Lucet-comert performed works at almost half of the addresses from the project.

Academy Street Square. Photo: CIJM

The list of works performed in 2015, except parking spaces, comprised arrangement of a park on street Academiei and the construction of a pavement on str. Docuceaev.  The arrangement of the square on str. Academiei cost almost 700 thousands lei.

A lot of money, little efficiency

DGTPCC reports that Lucet - comert built 7.122 square meters of pavement, 1.799 square meters of pathway and 52 thousands 670 square meters of parking space. Also, a surface of 24.342 square meters of yards was paved. The market price for one square meter of pavement is 150 lei and the pavement works are paid in average by 80 lei for one square meter.  Simple calculi show that a sum of 12.132 million lei was spent for some parking spaces. Also, a square meter of asphalt costs in average 600 lei and this means that almost 20 million lei was spent to this effect. Thus, the total sum of the works reached 32 million lei. Of course, there were spent money for construction materials, transportation, adjacent works and this does not cost 21,5 million lei.

Except the fact that the works are very expensive, these made some residents of some blocks of flats unpleased, they were against clearing green areas or destroying the playgrounds.  Thus, the residents of a block of flats from sector Botanica tried to stop works when they saw that a playground was destroyed. The residents of a block of flat on str. Doga organized a protest. One of the residents of this street, Eugen Mortean is worried that nobody considers people’s opinion. “We are worried, the green areas were cleared. Nobody asked us whether we need these parking spaces. We collected signatures, we tried to stop the clearing, but nobody thought over our opinion”, said the man.

Invented amount of works?

Alexandru Panfilii, former head of division within the Chisinau City Hall claims that the  contracting side admitted many illegalities at the organization of the public tender for yards and parking places’ arrangement. ”Following the stipulations of the Regulation on the method to assess the estimative value of the agreement of public procurement and their planning, the contracting side purchases services of current maintenance of the blocks’ yards and not works. The tender book issued by DGTCC shows just works”, said Panfilii.

The expert believes that the introduction of works in a set of services was done intentionally to reduce the number of participants in public procurement and to be able to handle the amount of works performed.

"The public procurement was carried out without the necessary documentation, without a technical project of execution checked, revised and approved based on the law. The list of works from the tender book was made in the absence of technical documentation, with invented volumes of works. According to the law, the contracting authority of works is obliged to issue technical documentation of the project, to estimate the expenses, and include the addresses of the yards where works were supposed to be performed. Thus, the contracting authority could check the amount and the quality of the work", said Alexandru Panfilii.

According to the expert, the way the additional agreement was signed is dubious. "The legislation provides for amending the contract if there appear unplanned works. For example, if a high voltage cable was detected, that needs to be removed. But when works, which were not stipulated initially in the tender book, are expanded, another public tender must be organized” said the specialist.

From trade in food products by retail to businesses in constructions

SRL Lucet-comert was established in 2002. Initially, the enterprise activated in trading food products by retail. Gradually, it started working in constructions. The construction projects of the economic unit are: general school in the village Dancu, district Hancesti, aqueduct in town Hancesti and Ceadir-Lunga, street Studentilor and pedestrian street Alexandru Diordita in Chisinau, as well as residential block on street Ghioceilor under the social Program "First House", implemented by the Chisinau City Hall. Lucet - comert carried out works of installation of the monument to the Victims of deportations in the railway square in Chisinau. This company built houses for flood victims in villages Cotul Morii and Nemteni in 2010.

The information published on the website of the Ministry of Regional Development and Constructions shows that in August 2010, Lucet-comert had the lowest business figure (4,5 million lei) of the economic units selected to build houses for the victims in district Hincesti. This made unhappy other economic units that claimed that Lucet-comert won illegally the tender.

This company is involved in another conflict related to poor quality of works on the pedestrian street. Though, initially the cost of the project for str. Diordita was estimated at 6 million lei, a sum of 12 million lei was spent for these works, which is twice more. According to the legislation in force, the initial sum of the agreement might be increased by no more than 30% for public procurement.  ”I do not understand why Lucet - comert was not sanctioned for the poor quality of the works performed”, was wondering the municipal councilor Ilian Casu on a socialization net.

Though, the company did not perform works on the pedestrian street in set terms, Lucet - comert continued to get agreements from public funds. This enterprise performed reparation works in the Great National Assembly Square last summer. On June 9, 2015, a week before the local elections, Chisinau City Hall announced about the start of works in the Great National Assembly Square, so that the square was supposed to be closed for any public manifestation. This decision worried mainly the organizers of a concert dedicated to the Day of Russia.

Agreements of millions over the last years

Over the past 5 years, SRL Lucet – comert won tenders of performing construction works estimated at 175 million lei in Chisinau. In summer last year, except the tender for arranging the yards,  Lucet-comert  won other 3 agreements estimated at almost 7 million lei.

The press wrote that the company won very many agreements because Lucian Chirtoaca, brother of Chisinau Mayor is the owner. Ivan Negara, the director of the enterprise denies this information. “These are speculations. We win tenders owing to our reputation and offers. This enterprise is owned by my sister Ludmila Cecetova.  Here from the name of the company”, said Negara.  Igor Gamretki, head of DGTPCC and former classmate of Dorin Chirtoaca denies that  Lucet - comert  is the enterprise of Lucian Chirtoaca. “They aim to compromise the mayor. Lucet-comert proposed the lowest price and won the tender. Any enterprise that proposes a lower price, will win the tender”, said Gamretchi.

Socialist councilor, Ion Ceban shares another opinion. “The Division of blocks of flats and arrangement is responsible for yards’ arrangement. Perhaps, they wanted to control money. The earmarked sum is exaggerated. The Court of Accounts would discover many irregularities”, said the councilor.

This investigation was conducted within the Campaign "Public Money is My Money too" carried out by the Center for Investigative Journalism (CIJM) and the Association for Efficient and Responsible Governance (AGER),  under a project funded by the European Union and the National Endowment for Democracy.

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