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Inside City Hall: Low bidder rejected for minority infraction

P. Flanigan & Sons wins a large sewer contract after the low bidder runs afoul of the city's minority participation goals.

orchard ridge

Site of the future sewer lines at the Orchard Ridge housing project in East Baltimore.

Photo by: Mark Reutter

The penalty to a contractor who misclassified a minority firm in a city sewer project – loss of a nearly $6 million contract.

The penalty to taxpayers – an extra $340,000 handed to a politically connected contractor.

The Board of Estimates yesterday approved a higher bid from P. Flanigan & Sons – paver of the Grand Prix racetrack last summer and identified by The Brew as among the biggest contributors to Mayor Stephanie Rawlings-Blake’s reelection campaign – after both the lowest bidder and second-lowest bidder ran afoul of the city’s minority and women’s goals program.

The contract, involving the excavation and installation of sewer lines at the Orchard Ridge subsidized housing project in East Baltimore, is an example of the scrupulous application of minority goals that manages to cost the taxpayer a bundle.

In this case, the overall cost of the project ballooned by 6% as a result of improper paperwork regarding a 1.7% share of the project.

Minority Contracting Maze

The spending board, which includes Rawlings-Blake, accepted the reasoning of the city’s minority contractor overseer, Shirley A. Williams, that the low bidder misclassified Best Fence Inc. as a WBE (women business enterprise) instead of a MBE (minority business enterprise). Williams is head of MWBOO, the Minority and Women’s Business Opportunity Office that operates within the City Solicitor’s Office.

According to Williams, the mistake was a result of Best Fence being sold by its female owner to an African-American buyer, which changed its classification from a WBE to a MBE.

The contractor, Daisy Concrete of Wilmington, Del., was unaware of the sale and had placed Best Fence in its bid papers as a WBE instead of a MBE. This meant that the bid had 16% MBE and 2% WBE participation, instead of the 14% MBE and 4% WBE participation stipulated in the bid.

“Minor Irregularity”

Daisy’s lawyer, Scott A. Livingston, told the spending board that the error was a “minor irregularity” that could have been corrected had the city notified the company and given it a chance to substitute a new WBE.

The Brew published an article on another instance where Williams’ office disqualified the low bidder for a correctable infraction of MBE/WBE rules. In that case, the Board of Estimates awarded the job to P&J Contracting Co. whose bid was 74% above the low bid.

P&J is owned by Pless B. Jones, head of the Maryland Minority Contractors Association and a member of the host committee that raised $600,000 at a Rawlings-Blake fundraiser last January.

On the other hand, MWBOO sometimes approves contracts that fall short of minority goals  – or waives the goal altogether. That practice came under criticism from the Baltimore NAACP following a Brew article about the handling of Head Start grants.

Williams has defended her actions as following the city’s complex MBE/WBE rules. She plans to retire from city government at the end of this month.

Political Giving, Contract Receiving

In yesterday’s Orchard Ridge contract, Williams also rejected the second lowest bidder for including a non-certified landscaping company. The error meant that American Infrastructure’s WBE participation was 3.1% rather than the stipulated 4%.

By unanimous vote, the spending board awarded the contract to Flanigan – even though its bid was $339,240 more than Daisy Concrete and $178,580 above American Infrastructure.

The board was equally generous to Flanigan three months ago, handing it $637,741 for an extra work order (EWO) appended to the Grand Prix paving contract.

Neither Daisy Concrete nor American Infrastructure appear on the Maryland Elections Board database of political contributions to Mayor Rawlings-Blake or other city officials in the 2011 city elections.

P. Flanigan & Sons (including its principals) has given Rawlings-Blake $13,500 since 2008, The Brew found in its review of  election board records.

The contractor was also a “gold” corporate sponsor – the second highest sponsor category – of the Mayor’s Inaugural Ball held last month at the Baltimore Hilton.

Other Contracts and Loans

In other action, the board – which includes Rawlings-Blake, City Council President Bernard C. “Jack” Young, City Comptroller Joan Pratt, City Solicitor George Nilson and Public Works Director Alfred H. Foxx – approved the following:

$1.5 million to Rummel, Klepper & Kahl (RK&K) for “on-call” consulting for the bureau of water and wastewater for an evaluation of the city’s stormwater drain system. The agreement lasts three years.

$170,077 to RK&K for “on-call” consulting for four sewer contacts and one water contract. The consultant “will provide project management assistance, claims, change order and schedule reviews and litigation and negotiation support,” according to the spending board’s agenda.

$1.1 million to Verizon to provide enhanced 911 service for the Police Department. This was a no-bid extension of an existing contract because Verizon “is the sole provider of enhanced 911 service in Maryland.”

$1 million to Correlli Inc. for aftermarket parts and service for heavy equipment for the fleet management section of the Department of General Services. This award increases the amount awarded to the White Marsh-based company to $3.5 million since the contract was awarded in late 2007.

$1 million to Waste Equipment Sales & Services for parts and services for Mitsubishi trucks for the fleet management section. This is an increase of a $750,000 award for parts and services approved by the board in 2010.

• $600,000 to Power & Combustion Inc. for boiler repair and other services for various agencies.

• $737,400 to Allied Contractors for rehabilitating the paths at Riverside Park in South Baltimore for the Department of Recreation and Parks. Machado Construction Co. had a lower bid than Allied Contractors – $675,071 – but the bid was rejected by the board yesterday because Machado was late in applying for its yearly prequalification and was not prequalified when the bid was accepted on Nov. 2.

While saying he was sorry about the rejection, City Solictior Nilson faulted Machado for not allowing “reasonable predictable processing time” for prequalification.

• $500,000 loan to the National Aquarium in the Inner Harbor to renovate the stingray tank, including reinforcing the concrete walls and upgrading the electrical system “to improve the overall visitor experience.”

• $182,437 to GWWO Inc. for “on-call” architectural design services for the new Clifton Park Recreation Center gymnasium

• $104,924 to Century Engineering for “on-call” consulting on the Inner Harbor East bulkhead and streetscape design. The work will include designing an ADA-compliant pedestrian ramp and marina dock access structures.

Extra Work Orders (EWOs) Approved

• $582,738 to Monumental Paving and Excavating to build a retaining wall and bulk loading area for the Super Citizen Convenience Center, a drop-off for trash and recycling on Sisson Street.

In order to complete this project on time last October, the Department of Public Works used a “live” contract with Monumental instead of bidding out a new contract, Public Works Director Foxx said yesterday. Foxx said his agency had called on the Department of Transportation to supply a contractor, and DOT came up with Monumental, which had been doing $18 million of excavation work for the city’s Uplands housing project in Edmondson Village.

The price for the Sisson Street job was reached after negotiations between DOT and Monumental, without direct input from Public Works, Foxx said yesterday.

“I have to investigate the price,” he said after the board meeting yesterday. Asked if he believed the price was too high, Foxx said, “The price is probably reasonable. I do want to see how much was internal work,” referring to work done by DOT crews and not by Monumental.

• $655,000 to Am-Liner East, Inc. for the television inspection of sanitary sewers that use cured-in-place pipe. This EWO is on top of the original contract of $1.75 million.

• $244,000 to Cianbro Corp. for rehabilitation of the Pennington Ave. Bascule Bridge.

This is the 18th EWO for this project, which has ballooned the contract from the original bid price of $14.5 million to $25.5 million. The latest cost increase will be covered by the Maryland Vehicle Reserve Fund allocated for the Hanover Street Drawbridge and a federally-funded reserve fund for a project at Argonne Drive and 39th Street, according to the board’s agenda.

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  • Baltimoreplaces

    Here is some of that waste we could do without (pun intended).  How does city hall expect the average citizen to have symapthy for their budget woes, and be willing to pay new taxes and fees when they are so irresponsible with the money they recieve?  Urban politics are wholly unique.

    Thank you for reporting this. 

  • rclegg

    Why do race, ethnicity, and sex need to be considered at all in deciding who gets awarded a contract?  It’s good to make sure contracting programs are open to all, that bidding opportunities are widely publicized beforehand, and that no one gets discriminated against because of skin color, national origin, or sex.  But that means no preferences because of skin color, etc. either–whether it’s labeled a “set-aside,” a “quota,” or a “goal,” since they all end up amounting to the same thing.  Such discrimination is unfair and divisive; it breeds corruption and otherwise costs the taxpayers and businesses money to award a contract to someone other than the lowest bidder; and it’s almost always illegal—indeed, unconstitutional—to boot (see 42 U.S.C. section 1981 and this model brief: http://www.pacificlegal.org/page.aspx?pid=1342 ).  Those who insist on engaging in such discrimination deserve to be sued, and they will lose.

  • Maryland Esquire

    Government contracting is a tough business.  A bidder has to follow strict rules in order to submit a responsive bid and to be found responsible.

    Recently, the State of Maryland has revised its own MBE regulations to allow the correction of good faith errors in the MBE participation submissions.  Baltimore City should consider following suit.

    To rclegg:  As you are aware, the law of the land is not that MBE programs are always unconstitutional.  Croson made clear that requirements may not be enforced, but goals may be permissible (under certain circumstances, as clarified and articulated by later decisions).  What I find interesting is the strict enforcement of a “goal.”

    Thanks again to the Brew for covering the BoE and procurement matters.

  • http://www.facebook.com/profile.php?id=1510154191 David Kennedy

    i am a small business owner.  i also happen to be “white” [although "i don't see race", but my spouse says i am].  
    i do not bother to bid government work, or work that the government has a hand in, for the very reasons noted in the excellent article.  why waste my time?  i have no shot at the work anyway.  i don’t fit the profile.  and no, i really have no biases, pro or con, towards any “minority”.But unfortunately, i live in Baltimore City, so i pay for the set-asides anyway.  i could leave tomorrow but for the fact my spouse loves living in the city.  i do not.  however, i am stuck.  oh, the governor and his friends in the statehouse are floating the idea of another sales tax increase.  Lovely.

  • http://www.facebook.com/profile.php?id=1510154191 David Kennedy

    i am a small business owner.  i also happen to be “white” [although "i don't see race", but my spouse says i am].  
    i do not bother to bid government work, or work that the government has a hand in, for the very reasons noted in the excellent article.  why waste my time?  i have no shot at the work anyway.  i don’t fit the profile.  and no, i really have no biases, pro or con, towards any “minority”.But unfortunately, i live in Baltimore City, so i pay for the set-asides anyway.  i could leave tomorrow but for the fact my spouse loves living in the city.  i do not.  however, i am stuck.  oh, the governor and his friends in the statehouse are floating the idea of another sales tax increase.  Lovely.

    • Curtis

      With all due respect, do you really need your wife to tell you that you are white?  Are you really that uberly progressive and afraid of offending?  After a statement like that, my advice is to write “LOL” or a smiley face like this :-)     

  • Ktrueheart

    Baltimore City MWBO has an opportunity to make vaste improvements in how it administers this sorely needed economic, JOBs creating program.  Local minority businesses should be gaining economic support through awards of city contracts and currently laxed administrative procedures make this difficult.  If our elected officials are too blinded by $$$ from BIG business we need to shine a bright light on those influences.  This issue is clearly about whether Baltimore City tax dollars are being spent equitably and locally … sadly the answer is NO.  Thanks to the work of the NAACP Baltimore City Chapter, the Greater Baltimore Black Chamber of Commerce and the Hispanic Chamber of Commerce for bringing this topic to the fore-front on our Mayor’s agenda and thanks to the Baltimore Brew for continuing to report on the work (loosely used) of the Board of Estimates. 

  • Anonymous

    From the series–USA 2012

    It would be told–
    the man who bid the most was also the best.

    that he wore a suit, a tie a vest,
    that he carried cash in his right hand,
    on his left hand he wore diamond rings,
    that he was a smooth talking machine–
    his sangfroid like molasses and milk–
    that he laid it on the line–
    “I’ll scratch your back, you scratch mine”–

    It would never be ever revealed
    that contracts were his to steal,
    as long as he can charge
    through democracy’s open doors
    raining dollars like roses on those
    who need dollars to win at the polls-

    “Why not?”it would be told,
    “It’s his right to give when he wants,
    It’s his right to take what he wants,
    Since he gives as much as he wants–
    It’s his right to ask what he wants–

    Freedom of speech is his right,
    freedom to bid is his right,
    freedom to campaign with cash
    and install the ones he likes
    to legislate the way he wants
    that’s also his god given right”.

    that the poor man wants his share
    of the diminishing pizza pie,
    that the talented man has bid low,
    selling his body and soul-
    because he knows if he didn’t
    he wouldn’t have a prayer in hell-
    to get through to the ones who can rule–
    he just didn’t do it right–
    he didn’t cross his t’s, dot his i’s–

    that the talented man has bid low-
    scraped his knees, filled his papers on time,
    declaring he can do it for less–
    to get through to the bean counters with clout–
    none of that matters an iota
    when the talented man has no clout–

    the talented man better acknowledge–
    he has failed by not what he knew–
    he has failed by whom he didn’t know,
    he’s been defeated by the bedazzling force
    of a pact called quid pro quo–

    that’s the privilege of a smooth talking man–
    his sangfroid like molasses and milk–
    his heft packaged just right,
    the Supreme Court on his side–
    the sound of his coins raining-
    skilfully argued as speech
    has been declared as such
    by nine judges–
    appointed to their posts for life–

    So you see, it would be told–
    by the bean counters–
    benefactors with clout–
    by accident not by scheme,
    by coincidence not by plan–
    the fat cat with the most to give–
    to the mean cats of the political scene–
    by the beauty of happenstance–
    that same fat cat was also
    the one with the most experience–
    and the one with the capacity–
    to do the very best–
    for the city that never reads–
    the ethics laws it writes–

    the man who bid the most–
    by god’s grace will always be
    also the very best….

    Usha Nellore

  • Odette Ramos

    I believe strongly in the MBE/WBE goals and the purpose of the program.  The small infractions should have been noted and the bidder allowed to correct them, or re-bid the entire job – which is the fairest way to move on this.  I am glad the infractions were pointed out.  Thanks to the Brew for helping us understand what is going on there.  Thanks to Ktrueheart for your kind words about the Baltimore Hispanic Chamber and for being at every BoE meeting as well.

  • Linda

    Thanks for this, Brew! It’s good to know.  So two goals were not met:  minority/women participation and taking care with the citizens’ money. I hope whoever replaces Ms Williams takes a more reasonable approach, and WITH the mayor’s support for that approach.

  • T-Bird

    My firm regularly bids for public work and we know that the MBE/WBE requirments are enforced haphazardly.   It cost the City of Baltimore $62,329 because their MBE department couldn’t speed up the process of yearly MBE registration (?) and it was Machado’s fault because they didn’t realize that the bureaucrat that stamps the yearly registration form was out sick for a month with “gout”.

  • Curioussheridan

    Thank you– this is brilliant

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