Comptroller General Puts Flamingo Marina Decision on Hold

By Zoraida Diaz

The Comptroller General’s Office has annulled a decision awarding the concession for the Flamingo Marina to an international consortium of developers, turning back the process almost two years.

Nineteen months after one group, Desarrollo de Marinas Matapalo Demm S.A., had been awarded the concession, the Comptroller General’s Office has ruled the process did not conform to the laws that govern administrative contracting.

All six of the eight groups, which passed a rigorous first phase, pre-selection process in their quest to build and operate the Flamingo Marina, have been asked to re-submit their tenders.

Ruling upon the first of two appeals filed by losing bidders the Comptroller General concluded the Municipality of Santa Cruz had chosen the bidder without evaluation parameters or methodology, and that “any position assumed would be based on subjective analysis, unknown to the participants.”

At $91 million, Matapalo DEMM was the biggest and most ambitious project among the bidders. The company’s plans call for a new breakwater plus 442 boat slips, some capable of handling mega-yachts of up to 45 meters (150 feet). There will be coastguard, immigration, police and refueling facilities, a 20,000-square-meter hotel, a commercial center and an unspecified number of condominiums. The facility was also to have included an extended pier for cruise liners.

However, the Comptroller General ruled that unlike the first phase where points were assigned to each requirement, the tender published for the second phase “did not assign a percentage to each of the requirements, nor did it offer a methodology tied with the requirements to be evaluated that would allow an objective selection of the most convenient offer…”

The vagueness of the criteria ensured that the final decision would be “a discretionary act,” said the Comptroller General, citing as supporting evidence the Municipality’s own admission of subjective criteria, during an audience before the Comptroller.

“What was promoted here was a public tender divided in two phases, during which, in the first instance a points system was used, whereas in the final phase, the value system used was solely based on the public interest a and greater benefits to the community of Santa Cruz…” Municipal representatives said during that meeting.

When the Municipality chose Matapalo Demm, it was done on the advice of the Marina Commission assigned to evaluate the contestants. In announcing the decision last April, the Municipality said “the works to be built by this bidder [Matapalo Demm] are of the largest size and scope…and it’s the company that offers the best annual canon to Santa Cruz…”

However, the Comptroller General says size, scope, and canon were never assigned a specific value and therefore, the decision could only be a subjective one.

The Government insists it is not questioning the discretionary powers of the Municipalities, rather, it is encouraging the Municipal body establishes an evaluation system that is “complete, proportional, pertinent, transcendental, applicable and obligatory…”

The Comptroller General’s decision is another blow to what has been a chaotic five-year process mired in setbacks and controversy.

Ademar Morales, President of the Municipal Council of Santa Cruz, confirmed this week the six groups that had first qualified back in May 2007, were still willing to continue with the process.
“We are greatly interested that the process continues,” Mr Morales said, adding the criteria would not vary greatly.

“It would be practically the same,” he admitted, “our fault was to not have assigned points to each requirement.

“Of course we are tremendously disappointed,” said Mr Morales, vowing to hire more experienced legal counsel.

“We are considering that if the companies are not interested in continuing with the marina process, we would find other interested companies and would consider awarding the concession directly,” he added.

It is not the first time the council has suggested awarding the concession directly, doing away with the more rigorous selection process.

After the process stalled last year, Councilor Braulio Moreno, who at one point, voted to suspend the adjudication, while the Constitutional Chamber or Sala IV ruled on appeals filed by the losing bidders, said a “direct concession” may in the end be the best option.

© Ralph Nicholson

FLAMINGO MARINA: The Comptroller General has reversed a decision awarding the concession to an international constorium.

Strangely enough, the Comptroller’s Office had already given the Municipality a stern reprimand as to its handling of the first phase, in response to another appeal that sought to render null and void the pre-qualification process.

“…It should be pointed out to the Municipality of Santa Cruz they should carry out an analysis of how best to maximize and use municipal resources efficiently,” read the judgment, dated October 16, 2007.

“Since the pre-selection process could very well have been suppressed and they could have immediately proceeded to choosing the concessionaire… saving the municipality resources and quickening the decision-making process.”

Oscar Villalobos, Technical Secretary of the Comisión Interinstitutional de Marinas y Atracaderos Turísticos, (or CIMAT), was quick to explain that the Municipality cannot award a concession without the project adhering strictly to the Law of Marinas. CIMAT is the government department charged with overseeing all technical aspects of those laws.

“Before a concession can be awarded, it has to have a technical and environmental viability from Setena (the National Technical Secretariat of the Environment) and CIMAT,” he said.

“A concession can only be awarded when the project has been defined; it must have a face, a stated capacity, a number of slips and approved facilities,” he added.

“The municipality could choose, but not award a concession.”

The Beach Times had access to one of the responses from a main bidding group that supports continuing with the process.

“....we reiterate our interest in continuing in the second phase of the bidding process,” the group said in a three page response, dated February 24.

But the rest of the letter is not as encouraging.

“...instead of asking if we are interested in continuing, the Municipality of Santa Cruz should proceed to draft and publish a new tender in La Gaceta,” it states.

“Only when we are before the conditions of the contest, can we evaluate if we wish to participate, or not.

“We also want to warn the Council that when drafting the tender, it has to include an evaluation system with technical support, to avoid objections or further appeals, as has already happened.”

Other bidders are equally unhappy with the process and with the municipality.

“It will be difficult to raise the financing in these economic times,” said another bidding group on condition of anonymity, “but that’s not the main problem...”

“It is unlikely, we are in any hurry to do business with the present Santa Cruz municipality.”

“There’s a little matter of trust,” they warned, “maybe it’s best to wait until the next administration...”

Considering the grinding halt to most multi-million dollar development in Guanacaste, Santa Cruz may have lost a golden opportunity to develop the area.