Quebec engineer admits collecting cash for municipal parties

A private engineering consultant dropped a bombshell on Quebec's corruption inquiry this afternoon, testifying Montreal public works contracts were routinely inflated by 25 to 30 per cent, his firm then turning over a portion to municipal political parties.

The president and CEO of the Montreal-based structural engineering firm Gnius Conseil, Michel Lalonde, described how contractors with whom he was on friendly terms were "accommodated" through inflatedproject estimatesor by approving cost overruns.

However, he insisted the cash his firm collected through this process was never pocketed, but always turned over to municipal political parties either by getting associates who were residents of Montreal to write cheques for fundraising tickets,or simply by handingover cash to the parties.

Political financing 'dates back to Duplessis,' Lalonde says

Lalonde said far from being a new phenomenon, "the financing of political parties went on in the days ofDuplessis," and his firm, formerly known as the Sguin Group,made political contributions to the parties of every mayor elected since it began doing business with the City of Montreal dating back to Jean Drapeau's tenure in the '60s,Jean Dor two decades laterand, in the '90s,Pierre Bourque.

'They'll take whatever means necessary to win....The only way to do it is with cash,' Michel Lalonde, consulting engineer

In 2001,Lalonde's firmbacked Bourque's losing party, Vision Montral,and he testified it took a good year or two beforethe engineering groupwas able to establish a working relationship with Grald Tremblay's winning Union Montral party.

Lalonde said eventually, he got a call from Union Montral party's fundraiser, Bernard Trpanier, to make a $2,000 contribution to an event for former executive committee chairman Frank Zampino.

He said he knew Trpanier slightly from his days as a federal Conservative Party fundraiser in the '90s, but their working relationship soon becamemore intense in the fall of 2004, withthe approach ofthe 2005municipal election campaign.

"I met Mr. Trpanier, and he said, 'Listen. Everything seems to be going well, we have to position ourselves for the next election ... We have to start talking about financing," Lalonde testified. "He said, 'Listen, Michel ... you're one of the firms that's well-positioned to get contracts. Then he asked mefor $100,000."

Lalonde said bigger firms than his were asked to contribute $200,000.

Trpanier comes up with '3%' solution

Lalonde said Trpanier was looking for a long-term fix for raising enough money for his party's political needs, and Lalonde testified Trpanier told him from that point on, he'd be expected to turn overthree per cent of the value of all contracts his firmwon to Union Montral.

He said he paid Trpanier the $100,000 in cash over a period of months, in five or six instalments, meeting him "discreetly"in hisoffice atthe party's political headquarters on Saint-Jacques Street.

"He'd close the door, and often, as you've heard, the blinds would be drawn," Lalonde said. "I'd give him the money. That's it."

Earlier, the inquiry heard from former Union Montral organizer Martin Dumont that Trpanier known as "MisterThree Per Cent" once had hisoffice vault so stuffed with cashthat he wasn't able to shut it without help.

Asked how it was he never questioned being asked for so much cash to finance the party amounts far in excess of the $1,000 annual individual contribution that was legal at the time Lalonde explained it was just the way the system worked.

"If they want to invest more than what they're allowed in order to win an election, you understand, they want to win, they'll take whatever means necessary to win," Lalonde said. "The only way to do it is with cash."