By Chris Brown/ Tiffany Goodwein

Updated with comments from the mayor

Orka rescinds bid for Invest Medicine Hat contract

Jul 23, 2021 | 3:06 PM

UPDATE- Orka Management Group has rescinded its proposal to the City of Medicine Hat to take over Invest Medicine Hat.

The decision comes after more than a week of public outcry and allegations of a conflict of interest.

Orka was founded in February by Jason Melhoff, Invest Medicine Hat’s current managing director. Invest Medicine Hat employees Chris Perret and Erik Van Eck also hold a stake in the company.

“The team at Orka acknowledges that the perception of a conflict of interest is sufficient to remove our firm from the bidding process and to allow the City opportunity to re-evaluate their bid process with questions from the community,” reads a statement from Orka.

WHAT'S ON

Here is what's on this weekend in Medicine Hat and area: Dec. 13-15

5h ago

IN THE COMMUNITY

Medicine Hat's Mustard Seed adding new shelter spaces at Alberta government's request

Dec 12, 2024

HOLIDAYS

Medicine Hat Kiwanis hosting Christmas dinner, applications due Friday

Dec 12, 2024

The full statement from Orka can be read below.

In a telephone interview Friday afternoon, Mayor Ted Clugston said the process to contract out Invest Medicine Hat has been paused indefinitely until a new council gets voted in.

“It is not even possible to restart it now in the next two months. So the new council will have to decide if they want to continue with Invest Medicine Hat if they want to contract it out, if they want to make it a municipal corporation, there’s definitely a bunch of other options but it will definitely be up to the next council,” Clugston said.

At the next council meeting on Aug. 3, Clugston said he will be asking council to request an independent review of the process to ensure that no conflict of interest or bias ever took place.

“I fully expect everybody will be vindicated, and for those that suggested that the process wasn’t fair you may want to be careful going forward,” the mayor said.

Clugston said he wasn’t surprised that Orka Management Group rescinded their proposal given the high level of public backlash.

“The amount of attention and character assassination was too much, I would think and it was unfair to a business just trying to make a bid on a totally legitimate RFP,” he said.

Clugston noted that it was always the plan to contract out Invest Medicine Hat, after putting it in the public sector and applicants had five weeks instead of the standard four weeks to place a bid.

The mayor added that he was very bothered by the low number of bids that were received for the RFP. Orka Management Group was the only bidder for the contract when the request for proposal period ended on July 19.

“Frankly we didn’t get any, and I will tell you why we didn’t get any. The bid wasn’t even open before it was rescinded. So we don’t even know what was in it and it will be in the shredder. So the city considers this as zero bid,” he said.

In the end, Clugston said he would have liked a competitive process, with at least five to six bidders, but that never happened due to the high amount of backlash.

“Everybody got spooked because of the harassment on social media, and the media,” Clugston said.

Over the past week, mayoral candidates, local realtors, the union representing city employees and regular citizens have all voiced concerns about a conflict of interest.

As the public outcry grew and before the RFP period ended, city manager Bob Nicolay said the city has a very fair and thorough process and maintained there was “absolutely no conflict.”

A request for proposals for the Invest Medicine Hat contract was issued on June 15, with little public notice, something Nicolay admitted was a mistake on his part.