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Was developer of housing agency project properly vetted?

Originally Published in the Capital Gazette

Government Transparency

by Capital Gazette Editorial Team

MPPI IN THE NEWS

The recent decision by the state to reopen the bidding for moving one of its agencies to Prince George’s County raises serious questions about how officials choose contractors.

Last year Gov. Martin O’Malley announced that he was going to move the Department of Housing and Community Development from its Crownsville facility to a new office-retail-residential complex in Prince George’s County. The governor said the move would concentrate development near the New Carrollton Metro and MARC stations and stimulate the economy in Prince George’s — a county that’s politically important to him.

Financially, the move never made sense. The state was proposing to pull 300 employees out of a serviceable building it owns in order to rent a property for $3.2 million a year — about $1.7 million more annually than it costs to operate the structure in Crownsville. And then there would be moving costs, estimated at $3 million. Even the union representing DHCD employees saw no reason for the move.

We and the county legislative delegation demanded to see the state reports supporting the assertions that this move would ultimately make money. And we asked for records showing who had bid on the project. Our requests were initially denied, but now that we’ve filed a Public Information Act request we expect to see some documents in a couple of weeks.

The recent decision to reopen the bidding, however, hints at why the state hasn’t been eager to provide us with the documents.

The bid was awarded to developer Carl S. Williams. According to the Maryland Public Policy Institute, one of Williams’ projects resulted in a 2008 foreclosure sale of $5.5 million. He had been rejected when he applied for a loan from the DHCD. And, according to reports in The Washington Post, Williams owed the state more than $124,000 in back taxes, penalties and interest.

Perhaps none of this is relevant to this bid, but it raises questions: Did the information brought to the public’s attention by the media cause the state to rebid the contract? Was Williams properly vetted? If the state knew about his background, was an effort made to at least settle previous issues before awarding him a new contract?

Williams’ problems aren’t unusual — failed projects and cash-flow problems are a part of his business. But these problems should have played some role in the state’s decision.

The state is playing with millions of dollars of taxpayer money on a project that makes sense politically but not financially. That forces us — and Del. Ron George of the county delegation — to pay to see documents justifying the state’s case and explaining its change of mind. Yet the state doesn’t think it needs to explain its behavior. Arrogance like this has no place in government.

Something smells here and the governor owes us a better explanation than his office has given us so far. Taxpayers should demand it.