(The Canadian Press circulated the following story by Dirk Meissner on March 11.)
VICTORIA — The B.C. Liberal government refused Thursday to put the brakes on its $1-billion sale of Crown-owned B.C. Rail despite opposition taunts that Premier Gordon Campbell’s privatization plans are surrounded by police.
RCMP warnings that the bidding process for a B.C. Rail spurline at Roberts Bank near Vancouver might be rigged by people with sensitive government information prompted the Liberals to cancel its sale plans Wednesday.
But the earlier and separate $1 billion rail deal appears clean and will go ahead, Transportation Minister Kevin Falcon said.
“Every time this government tries to privatize something the cops have to get involved,” NDP house leader Joy MacPhail said. “Halt the sale now.”
CN Rail and the government announced a partnership last December that would see the U.S.-controlled company take over the freight operations of B.C. Rail with government maintaining ownership of the line, which runs from North Vancouver to northern British Columbia.
“We have no information to suggest that the successful proponent CN came into possession of any information that would have affected the outcome of the B.C. Rail-CN investment partnership whatsoever,” he said.
Falcon refused further comment when asked if the decision to halt the spurline sale was related to a police raid last December on the offices of ministerial assistants in the B.C. Finance and Transportation ministries.
A summary of search warrant information released last week said the raids related to possible influence-peddling and breach of trust connected to B.C. Rail.
Controversy swirled around the government’s sale of the Crown-owned railway last year to CN after competitors CP and OmniTRAX-Burlington Northern Santa Fe complained the process was unfair.
A report commissioned by the government found the sale of B.C. Rail was fair and conducted properly.
RCMP have said the Dec. 28 raids at the legislature arose from information turned up in a separate 20-month investigation involving organized crime, money laundering, drugs and police corruption.
The offices of David Basi, ministerial assistant to Finance Minister Gary Collins, and Robert Virk, ministerial assistant to former transportation minister Judith Reid, were searched.
Basi was fired immediately and Virk was suspended with pay. The pair are well-known federal Liberal organizers.
No one has been charged and police have stressed no elected politicians are involved.
Despite Falcon’s assurances, MacPhail said she has deep reservations about both B.C. Rail deals.
“This whole deal, the two parts, both the original sale to CN and the failed bid for selling the spurline to Roberts Bank stinks to high heaven,” she said.
MacPhail questioned why Collins met with the head of OmniTRAX, a U.S. rail company that submitted bids to both B.C. Rail offers, for private dinners.
Collins said he met with Pat Broe, the head of Broe Companies Inc., which owns of OmniTRAX on two occasions.
Once before the bid process started and again when it was completed, he said.
Collins told a government committee recently that Broe wanted to discuss investing in British Columbia at the first meeting and, during the second meeting, the U.S. businessman said he still wanted to invest in the province despite losing the rail bid.
OmniTRAX president Dwight Johnson said in a statement that he was “disappointed that the bidding process for the Robert Banks Line has allegedly been tainted and is now over.
“We have no understanding other than what has been reported in the media as to the reasons for its cancellation,” he said.
OmniTRAX said it was not a bidder in the spurline process, but would operate the spurline for Australian financier Macquarie if that bid was accepted.
A spokesman for CP Rail, part of a three-company bid for the spurline, said the cancellation of the bid process came as a shock.
“We were surprised at the news story, at the information released by the government yesterday,” said CP spokesman Paul Clark. “We had been unaware of any activity in this area.”
CP, CN and the Vancouver Port Authority were one of three bidders for the cancelled spurline.
Southern Railway and the OMNITrax-Macquarie partnership were the other two interested parties.