BALTIMORE — Baltimore City's Board of estimates voted on Wednesday to rescind a multi-million dollar infrastructure contract with Metra Industries, while deciding to suspend them for two-years.
The company was three-years into a water rehabilitation and improvement project with the Department of Public Works (DPW).
Last year the Minority and Women’s Business Opportunity Office (MWBOO) launched an investigation into Metra over alleged late payments to subcontractors.
It all started May 9 when Metra sought approval to replace a subcontractor called Economic International Construction Company, Inc. (EICCI).
According to MWBOO, Metra falsely claimed EICCI raised its costs and was no longer available to work the project.
MWBOO says the real reason EICCI couldn't work was because Metra had been months behind on payments, and still owed them thousands.
"Metra did not acknowledge that EICCI was willing to continue work on WC 1403 if the outstanding balance owed to them was satisfied," said Christopher R. Lundy, MWBOO Chief. "Metra’s substitution request stated that the EICCI unavailability was due solely to cost increases."
On October 24 EICCI lodged a complaint against Metra over the late payments. DPW in response refused to process anymore job estimates until Metra satisfied their financial obligations.
About two months later, Metra finally paid EICCI the remaining balance of $38,483.64.
Per code, primary contractors are required to pay subcontractors within 7-days of being paid by the City.
"It was only when the overall contract funds, that would serve to benefit Metra, were at risk that they took seriously their Code and contractual obligation to pay their subcontractors," said Lundy, who recommended that Metra's contract be revoked and future services suspended.
Metra attorney, Venroy K. July, of D.C. based corporate law firm Dickinson Wright, urged the board to vote against Lundy's request.
"The recommendation of Mr. Lundy so far exceeds any notion of reasonableness for the purported wrong actions that it hints of some underlying and alternative basis," July wrote in a letter to the board.
Although July acknowledged Metra was sometimes late paying, he appeared to call out and blame the City.
"Metra acknowledges that subcontractors are entitled to timely payment on work that has been completed, and while it does not excuse its own late payments, prime contractors are similarly entitled to timely pay for work completed for the City," July wrote. "The City’s continuous failure to make timely payments impacted Metra’s cash flow and availability of capital, and its ability to make timely payment, particular during and on the heels of the Covid pandemic."
Despite the late payouts, July said Metra actually overpaid EICCI.
"Metra overpaid amounts due to EICCI, but such payment has been misinterpreted by Mr. Lundy without the opportunity for explanation."
July tried boosting Metra's case stating EICCI had already been paid $558,247.40 for prior work before their complaint was ever filed.
He also touted Metra's past business dealings with minority subcontractors.
"Metra has utilized and subcontracted with MBEs for an approximate value of $16,616,106.12 and with WBEs for an approximate value of $7,813,016.12," said July. "In fact, EICCI, the only subcontractor actually named in Mr. Lundy’s recommendation, has been utilized by Metra on such contracts for an approximate value of $3,633,000 over the same period."
In the end the board still voted against Metra, meaning the company is banned from working on City contracts for the next two-years.
