A109 Light Utility Helicopter flight with mayor Gisborne City from the air in November 2023.
Gisborne roading subcontractors should find it easier to get contracts under a Gisborne District Council road maintenance system encouraging competition and more opportunities for local companies.
Councillors, sitting as the operations committee, have approved the draft road maintenance procurement programme which will result in seven contracts being awarded early in the new year.
Council director of community lifelines David Wilson told councillors he wanted a competitive situation where subcontractors, or tier 2 and tier 3 contractors, would be encouraged to apply for tenders.
This would “eliminate the current mindset that tier 1 contractors can monopolise the network” and allow the “best options for procurement for the entire community”.
Mr Wilson said it would be requested of tier 1 contractors that they inform the council what work would be done by subcontractors and what was the value of the tier 2/tier 3 work in their bid.
That would provide continuity of work for subcontractors and boost the local economy.
Tender applications would be awarded based on a weighted percentage system where social outcomes, including local employment, use of subcontractors, and sustainable market resources would be worth 8 percent.
Other criteria would be relevant experience, 10 percent; relevant skills, 15 percent; methodology, 30 percent; sustainability (waste minimisation, recycling, environmental management), 7 percent; price, 30 percent.
Mr Wilson said evaluating the criteria had been tricky. Price was important, no matter what.
It was a case of balancing between price and climate change, sustainability and social outcomes such as providing work for local subcontractors.
Relevant experience was also important.
“I don't want someone with trainer wheels running our main contracts. It's too hard on them and it's too hard on us.
“We know how that has gone in the past,” Mr Wilson said in an apparent reference to Australian company Services South East, which in 2017 on-sold its five-year northern roading contract after just two years.
Mr Wilson said rural roading contracts predominantly consisted of grading and drainage.
The issue was to have the right resources in the right place.
It did not make sense to have to move resources from Gisborne to distant parts of the East Coast.
The maintenance contracts did not include flood repairs or capital works.
Mr Wilson said tier 1 contractors included Downer, Fulton Hogan and Higgins.
He had spoken to a number of tier 3 contractors. Some wanted to work alone while a couple preferred to work with a larger contractor.
The desire for competition meant contractors would only be allowed to apply for three of the seven contracts.
The original idea had been that a contractor would not be awarded both the Uawa and Waipaoa contracts which provide “the Lion's share” of roading work.
There had been “pushback”, said Mr Wilson. “But no one has a monopoly. We don't want that.”
Four of the contracts are Hikurangi, Uawa, Turanga (city urban area), Waipaoa, which replace the former northern and western contracts.
The three others are standalone contracts for reseals, vegetation and street lights.
Replying to a query from councillor Tony Robinson about what would happen if a contractor was “streets ahead” with its tenders, Mr Wilson said he would speak with the company and approach councillors for guidance and approval.
Mr Wilson said new innovations coming in terms of sustainability were “really cool”. These included staff driving around performing other duties while their vehicle used Artificial Intelligence to assess road conditions thereby lowering vehicle numbers and the carbon footprint.
He had a good idea which companies were interested in the maintenance contracts.
Some companies had told him they did not plan to operate in Gisborne.
The council would go to the market soon, with expressions of interest closing on September 30, he said.
Requests for tenders were due to be released on October 4. The tender period was October 8 to December 3 followed by an evaluation period from December 6 to December 22.
Councillors, at their first meeting in 2022, would receive recommendations to appoint.
Tenders were being drafted now.
Mr Wilson said Waka Kotahi New Zealand Transport Agency contracts were out in February.
“Ours are nailed first.”