Expensive Trees for Baratashvili Street - საერთაშორისო გამჭვირვალობა - საქართველო

Expensive Trees for Baratashvili Street

24 April, 2012

Update 10.05.2012: The City Hall has said that will cancel the contracts signed with Greenservice and will send the case to the law enforcement agencies for further examination.

Residents of Tbilisi have probably noticed that cypress trees have been planted on Baratashvili Street in the last few days. The story has been discussed actively in social networks too. For example, the Safe Space NGO reported that the residents of Baratashvili Street were unhappy with the fact that, as the cypresses were being planted, the trees that they themselves had planted earlier were being cut down. The same organization reported that the Tbilisi City Hall had allocated GEL 225,000 for the planting of trees on Baratashvili Street.

It was this sum that drew our attention and we decided to examine the relevant procurement documents. It turned out that the Tbilisi City Hall announced a tender for the purchase of trees to be planted on Baratashvili Street on 8 February. According to the tender documents, the City Hall intended to buy 120 cypress plants. The technical requirements referred to a specific type of cypress -- “Cupressus Pyramidalis from three plants”. The expected cost of the purchase was GEL 225,000.

As it turned out, there was only one company in Georgia capable or willing to provide this type of plants: Greenservice LTD was the sole bidder. According to the Georgian company registry, Greenservice is owned by Lasha Purtskhvanidze and Koba Kharshiladze. Lasha Purtskhvanidze is the former deputy mayor of Tbilisi and former head of the Old Tbilisi district administration, while Koba Kharshiladze is the former deputy head of the same district administration. According to the information that we collected from the electronic system of state procurement, Greenservice has won 17 tenders and has received over GEL 4 million from the state since 2010 (the electronic system does not contain information about the tenders conducted before 2010).

Greenservice’s initial bid was identical to the preliminary cost announced by the City Hall. Since Greenservice was the sole bidder, this amount (GEL 225,000) did not change subsequently. The Tbilisi City Hall and Greenservice signed a contract on 13 March. Under the contract, the City Hall paid Greenservice GEL 990 for each plant -- a total of GEL 118,800 for 120 plants.

We decided to find out how much the City Hall had paid for similar products on other occasions. For comparison, we reviewed a contract that the City Hall signed with another supplier on 30 January. Under that contract, the City Hall bought 5,000 plants of various type (cypress, tilia, maple, cedar, pine, ash) and the maximum price of a single plant was GEL 30, i.e. 33 times less than in the case of the Baratashvili Street tender. Had the City Hall purchased similarly-priced plants for Baratashvili street, the total cost of the purchase would have been GEL 3,600 instead of GEL 118,800 and the city would have saved GEL 115,200.

It is possible that there was a valid reason why the Tbilisi City Hall decided to plant such expensive trees on Baratashvili Street. It would therefore be interesting to see the City Hall give its reasoning.

Author: Transparency International Georgia