Audit report agrees that Palacio award process “was flawed”

Majorca Daily Bulletin reporterPalma06/11/2015 00:00

A report from Palma town hall’s auditor-general has supported the findings of the report into the Palacio de Congresos which was undertaken by Professor Avelli Blasco at the University of the Balearic Islands. The audit report concurs with Blasco’s in concluding that the award for the tender to manage the Palacio would “not be the best for the administration,” as it would “approve all the weak points of the administrative specifications of the contract.”

Neus Truyol, the town hall’s spokesperson, says that the report into criteria for the award “shows that through its procedure the town hall would lose out financially and that the formula adopted was perverse.” It establishes that the Barceló Group made an offer with the option to purchase the Palacio’s hotel for 40.5 million euros and that, once this contract was effected, the rent would go down from 1,750,000 euros to 350,000 euros, which is also the price for the Palacio’s rental.

This option to purchase, according to the audit report, was going to have been carried out, as noted in the documentation presented by Barceló, on the understanding of a leasing pre-agreement with BBVA bank for the acquisition of the hotel. The report indicates that the criteria for selecting a winner of the tender contest “do not allow the determination of the best offer in the interests of the administration.”

The town hall’s governing board has, therefore, agreed to not ratify the adjudication in favour of Barceló, taking into account both reports: those of the university and the auditor. It has also urged the board of the Palacio company to request a report from the Balearic Attorney’s Office into the waiving or non-continuation of the process for awarding the contract.