Re: Kilpatrick's pal thrives on city contracts
- So, Ferguson's expertise is in excavation, Translation: digging
holes. He is really digging a hole here/.
--- In Detroiters@yahoogroups.com, "black_detroiter1"
> Kilpatrick's pal thrives on city contracts
> Change orders pump up cost of Ferguson's deals; Kilpatrick, water
> board deny there's favoritism
> Robert Snell and Ron French / The Detroit News
> DETROIT -- A friend of Mayor Kwame Kilpatrick's has received at
> $170 million in city contracts -- $109 million from the DetroitWater
> and Sewerage Department alone -- since the mayor took office in2002.
> Bobby Ferguson, who has been at the mayor's side at black-tie social
> events and on the backs of motorcycles, has long claimed the
> relationship hurts his general contracting company's ability to land
> contracts. But an analysis of records by The Detroit News shows his
> share of water department contracts has jumped more than 20-fold
> Kilpatrick took office. Half of them have doubled, tripled or almostthe
> quadrupled in price because of additional work -- a cost that is
> spread among customers in 126 communities across southeast Michigan.
> Councilwoman Sheila Cockrel called The News' analysis "explosive."
> "It's a question of appearance," Cockrel said. "If you are part of
> inner circle of the mayor, there must be boundaries on how much workoffice
> you do with the city.
> "The numbers you've shown me raise questions that require serious
> investigation to determine if procedures were followed and whether
> there is material evidence of improper influence by the mayor's
> in the awarding of contracts."by
> In one case, a rival contractor said he was forced out of business
> Ferguson, whom he accused of underbidding competitors only to reapbig
> profits later through unbid, uncompetitive contract increases --Ferguson
> called change orders.
> Ferguson did not respond to an interview request or a list of
> questions e-mailed to him.
> Water and sewer spokesman George Ellenwood said Ferguson has not
> received preferential treatment. Others in the department say
> does a good job with excavation and other work.bid
> "There is no favoritism," Ellenwood said. "These are competitively
> contracts, and it's my belief that contracts awarded through thisawarded
> department probably have closer scrutiny than contracts generally
> awarded by the city."
> Kilpatrick faces perjury, misconduct in office and obstruction of
> justice charges in connection to text messages that appear to
> contradict testimony he gave in a 2007 police whistle-blower trial.
> Other text messages seem to indicate that former Chief of Staff
> Christine Beatty and Ferguson discussed city contracts.
> Changes pump up contracts
> Using the Freedom of Information Act to gain access to city records,
> The News examined all Water and Sewerage Department contracts
> to companies associated with Ferguson. The News then comparedsince,
> Ferguson's contracts and change orders with those received by other
> companies. Among the findings since Kilpatrick took office:
> Ferguson, who had received one water contract worth $5.2 million
> with the city before 2002, has received eight in the six years
> with a value of about $109 million. Two more contracts, worth $4.2from
> million, have been approved by the utility's commission and are
> awaiting approval by the City Council. Once partners and
> subcontractors are paid, Ferguson's company will collect at least
> $42.8 million, according to city records.
> Ferguson's companies also won $42 million in contracts from the
> Detroit Building Authority and $3 million in demolition contracts
> the Building Safety and Engineering Department. The News has notnoted
> examined complete records of other departments, but news reports
> $7.2 million from the Downtown Development Authority and $5.4million
> from three other quasi-city agencies such as the Detroit Economicjoint
> Growth Council, records show.
> Ferguson gets more money from change orders than any other water
> department contractor. Ferguson has received $39 million in change
> orders, which are ordered for various reasons, including additional
> work under the same contract. Under Kilpatrick, 46 companies and
> ventures have been awarded change orders. Contracts associated withorders.
> Ferguson account for 29 percent of total city cash spent on the
> On average, water and sewer contracts increased 14 percent from
> their original amount. Ferguson's jumped 48 percent.
> A quarter of Ferguson's water contracts bypassed normal City
> approval and oversight. Kilpatrick awarded the contracts throughmillion.
> emergency orders.
> The department argued that Ferguson's contracts appear inflated
> because many result from emergencies, such as last-minute repairs to
> improve the city before the Super Bowl in 2005. But even among
> companies receiving emergency contracts, Ferguson fared better. His
> contracts for downtown water pipe work in 2005 more than tripled to
> $4.8 million from $1.5 million. Hayes Excavating, in contrast, saw a
> 28 percent increase in its contracts, to $2.8 million from $2.2
> Rival contractor upsetcompetitive
> If a contractor knows he could get large change orders, he could
> underbid his competitors, thus undercutting the concept of
> bidding, said Bill Hayes of Hayes Excavating.of
> Ferguson is "living off change orders," Hayes said. "Nobody else can
> do that."
> Ellenwood, the water department spokesman, said change orders are
> meant to be small supplements to contracts.
> The department tries to keep change orders to less than 10 percent
> the original contract. He didn't know why Ferguson's contracts hadthey
> grown an average of almost 50 percent.
> "The numbers are the numbers that you have," Ellenwood said. "So
> would indicate that, yes, during that period, he had a higher rateofficials
> than the average of other contractors."
> Company a virtual unknown
> Before Kilpatrick was elected in late 2001, water department
> had barely heard of Bobby Ferguson's Detroit construction company,the
> Ferguson Enterprises, confusing it with a similarly named company
> suspended from getting certain federal contracts. Ferguson had been
> the recipient of one contract, a $5.3 million project to repair and
> replace sewer lines on the city's west side. That contract was held
> for further review as Ferguson had never done business before with
> water department, records show.seat
> That changed when a friend became mayor.
> Ferguson and Kilpatrick met in 1996, soon after Kilpatrick won a
> in the state House of Representatives, when Ferguson's companyhelped
> plow snow for some elderly residents in Kilpatrick's district for noleast
> charge, Ferguson said in previous published interviews.
> Kilpatrick stuck with his friend when Ferguson was convicted of
> pistol-whipping an employee, visiting the contractor in jail.
> Most water department jobs awarded to Ferguson were bid on by at
> a half-dozen other companies, records show. Ferguson has earned athe
> reputation for doing good work for the city, said Darryl Latimer,
> water department's contracts and grants general manager.he
> "A lot go after bigger jobs," he said. "His niche is excavation ...
> and he's good at it."
> Hayes has a different opinion. The veteran Detroit contractor said
> had steady contract work with the city for 40 years, but is nowmake
> defunct. He accused Ferguson of underbidding competitors only to
> more money later through change orders.me, 'Old
> "He (Ferguson) put me out of business," Hayes said. "He told
> man, it's time for you to go.' "former
> Friendship defended
> Peter Henning, a law professor at Wayne State University and a
> federal prosecutor, said the amount of contracts given to a friendof
> the mayor "raises questions," but cautioned against drawingconclusions.
> "Friendship is not a conflict of interest," Henning said.
> Kilpatrick doesn't have any influence over the awarding of city
> contracts, mayoral spokesman James Canning said in a statement.change
> "Contracts are granted in accordance with the city of Detroit
> purchasing ordinance and require the approval of both the Board of
> Water Commissioners and City Council," Canning said.
> But not always.
> At least $4.8 million in contract change orders given to Ferguson
> never received City Council approval, city records show. Those
> orders were approved by Kilpatrick under emergency powers grantedthe
> mayor as special administrator of the water department under anorder
> from U.S. District Judge John Feikens. As special administrator,AID=/20080609/METRO/806090379
> Kilpatrick had the power until 2006 to award contracts to anyone the
> mayor "deem(s) necessary and appropriate."
> You can reach Robert Snell at (313) 222-2028 or rsnell@...
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