EagleTribune.com, North Andover, MA

January 29, 2014

To pay or not to pay?

Councilors table discussion about $294K road paving bill

By Keith Eddings

---- — LAWRENCE — The City Council last night put aside a request to pay a $294,444 bill from a company that says former mayor William Lantigua promised to pay it though the work was done without a contract.

The company, Highway Rehabilitation Corp., originally had a $84,979 contract to pave a half dozen streets last summer. It continued working when the funding ran out after Lantigua and the city’s engineer and purchasing agent promised to pay for the added work, a representtive of the New York company told the council’s Budget Committee last night.

The city has refused to pay for the added work based on a state law requiring localities to rebid contracts that run over by 25 percent or more.

Highway Rehab’s bill eventually reached $379,423, a 346 percent overrun.

“We were assured we would be paid by the mayor at the time,” David Capelle, the company’s marketing and sales officer, told councilors last night. “We were assured there wouldn’t be a problem.”

The improved condition of the city’s streets was a cornerstone of Lantigua’s failed re-election campaign last year, when his administration spent a total of about $1.8 million paving streets and filling potholes.

The new mayor, Daniel Rivera, said Lantigua had his re-election in mind when he promised to pay Highway Rehab for the extra work without a contract. He said he is opposed to paying the $294,444 bill for the work, which could extinguish the company’s hope of collecting short of a lawsuit. The city can pay the bill only if both the mayor and the council agree to ask the state to allow it to waive the requirement that localities rebid projects that run over by 25 percent.

Acting Public Works Director John Isensee said Lantigua removed him from the chain of command on paving projects for most of the last four years and said he was not aware that the Highway Rehab was over budget and working without a contract. He suggested to the council committee that the administration’s decisions about what streets to pave and how to pay for the work was based on “manipulation, conniving and maneuvering.”

“Generally speaking, planning and implementing is done through DPW, but there was a bit more involvement with the administration than normal,” Isensee said. “Some of their exuberance may have resulted in more square yards (of paving) than (permitted) by procurement laws.”

Isensee’s chief engineer, Andrew Wall, said in an interview before last night’s council meeting that Lantigua “was driving the boat” on paving projects across the city.

Last night he told the council committee that he authorized Highway Rehab to continue working after running through the $84,979 in its contract because Purchasing Agent Rita Brousseau told him and Lantigua that additional state aid had become available to pay for it.

Although Lawrence received an added $300,000 in so-called Chapter 90 aid to localities for street projects last summer, Highway Rehab nevertheless should not have been given the added work without winning a public bid for it, Isensee and Budget Director Mark Ianello told the councilors.

Brousseau sent the company an email on Aug. 6 — when it was 10 days into the added work and had run up the $294,444 in billings beyond the contract amount — directing it to stop work and saying the city would not pay for the added work.

Shortly afterward, Highway Rehab bid for and won a second paving job in Lawrence, which the city paid for using the $300,000 in new state aid for road projects. With the last of the state aid depleted, the city would have to pay Highway Rehab’s $294,444 claim for the unpaid work out of its own pocket, a factor that figured in the councilors’ deliberation last night.

City Council President Modesto Maldonado, who serves ex officio on the Budget Committee but does not vote, suggested the committee send the request to pay the bill to the full council without a recommendation.

Kendrys Vasquez, the committee’s new chairman, instead asked the committee to table the issue to allow Budget Director Ianello to explore how the city might pay the bill.

Midway through the committee’s discussion, Councilor Marc Laplante questioned whether the committee should remove the press and public from the council chambers and continue the discussion in a closed-door session.

Laplante said the matter could end up in court so an open discussion could expose the city’s legal strategy. City Attorney Charles Boddy also noted that employees could face discipline in the matter. Disciplinary hearing are not open to the public.

The Eagle-Tribune objected on the grounds that Highway Rehab had not threatened to sue the city for payment, so no lawsuit or even the threat of one existed. The paper also noted that the committee meeting was not a disciplinary hearing, even if it led to one. The committee did not vote on the suggestion to go behind closed doors and continued the open session.