The ACT opposition has used parliamentary privilege to raise concerns about the process used to award the tender to own and operate Skywhale.
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During an Assembly estimates committee hearing, Liberal MLA Brendan Smyth questioned government officials about why only three companies were invited to tender for the contract to own and fly the centenary artwork.
Mr Smyth was concerned that Australia's largest operator of special-shaped balloons, Picture this Ballooning, was not invited to tender.
Jeremy Lasek, executive director of culture and communications for the Centenary of Canberra, said three companies had been invited to tender before the contact was awarded to Melbourne-based Global Ballooning.
"I think we did some research we sought advice from those who understand ballooning companies and they were the three that we went to,'' Mr Lasek said.
Mr Smyth asked why Picture this Ballooning had not been invited to participate.
The company has operated a range of special-shaped balloons, including an AFL football in Melbourne, a compact fluorescent light bulb for AGL and "Mike'' from Monsters Inc.
"They operate but don't own the balloons and they were unaware of this [tender],'' Mr Smyth said.
"How could we not have gone to the largest operator of special-shape balloons in the country?''
Mr Lasek said advice had been sought from within the ACT government before tenders were sought.
"I claim no expertise in ballooning so we went to, within government, people who do,'' he said.
He was unable to say who had provided the advice.
Several minutes later he said there may have been safety concerns related to Picture This. "As for the other ballooning company, I'm just hearing that there may have been some safety concerns over an incident that happened in Victoria which may have influenced our decision,'' Mr Lasek said.
''All I'm told is there may have
been an incident where the balloon went into the water somewhere.''
Damian Crock, chief executive of Picture This, told The Canberra Times that a balloon had come down lightly in Port Phillip Bay in 2011.
''It landed on the water in extremely light winds. The flight continued with no damage to equipment or injuries to people,'' Mr Crock said.
He said that while Global Ballooning was a superb company, he was disappointed his business had not been given an opportunity to tender for Skywhale.
''Certainly as the only specialist in this field in this country, we find it hugely disappointing that we were not invited to tender for what is a significant special-shaped hot air balloon project.''
The Australian Transport Safety Bureau's online listings of investigations and reports does not include any references related to Picture This.
Skywhale has cost ACT taxpayers $300,000 and also receive $50,000 in additional funding from the Aranday Foundation.
Chief Minister Katy Gallagher told the estimates hearing that the government had been satisfied with the services provide by Global Ballooning.
''We've had no concerns with Global Ballooning, in terms of their execution of the contract, or their fulfilment of the responsibilities,'' Ms Gallagher said.
The committee also discussed centenary artistic director Robyn Archer's $1.2 million, four-year service agreement.
Ms Gallagher said the deal had provided good value for money for taxpayers. ''I've witnessed how hard Ms Archer works, on a whole range of areas. The woman is a dynamo and I feel very confident that we've got value for money through that contract,'' Ms Gallagher said.
