Schmoke in-law got no-bid jobs totaling $327,001

June 24, 1994|By Eric Siegel | Eric Siegel,Sun Staff Writer

The brother-in-law of Baltimore Mayor Kurt L. Schmoke received contracts worth $327,001 from the city's public housing authority last year as part of the agency's emergency no-bid repair program.

John A. Palmer received the funds to renovate 20 units and several hallways in a public housing development in South Baltimore through his contracting firm, J. P. Construction Co., Housing Authority officials said.

Mr. Palmer is the husband of Deborah Locks Palmer -- the younger sister of Patricia Locks Schmoke, the mayor's wife.

The Palmers live on the same block in Northwest Baltimore as the Schmokes, in a home they built on land given to the couple by the mayor and his wife. The houses are separated by an undeveloped parcel of land owned by the Schmokes.

FOR THE RECORD - The spelling of C. William Struever has been corrected for the archive database. See microfilm for original story.

Mr. Schmoke and Daniel P. Henson III, executive director of the Housing Authority of Baltimore City, said in separate interviews this week that they saw no problem with a relative of the mayor's having received money under the $23 million no-bid program. The program is under investigation for possible corruption by a federal grand jury and is the subject of an audit by the Office of the Inspector General of the U.S. Department of Housing and Urban Development.

"There clearly is no conflict here," Mr. Schmoke said in an interview yesterday, adding: "There is no benefit for me and my wife from John's contract with the Housing Authority. I did not have anything to do with John's getting a contract, contacting anyone on his behalf or influencing anyone."

Mr. Henson, a longtime political confidant of Mr. Schmoke's, said he was aware that Mr. Palmer was related to the mayor by marriage but did not see that as a reason to keep him out of the program.

"Do you exclude a guy because there's that relationship?" Mr. Henson asked. "I think the relationship doesn't come close to meeting the appearance of a conflict of interest, unless you can show he gave the mayor a kickback," he added.

Mr. Palmer said this week that he had never done any work for the city before being awarded contracts under the authority's no-bid repair program.

Mr. Palmer said he did not discuss his participation in the program with Mr. Schmoke beforehand and his relationship with the mayor had nothing to do with his selection.

"I came in when they needed some people. And they gave me a chance. It was just sheer luck," Mr. Palmer said.

Mr. Palmer's company is the third firm owned by relatives of city officials to have received money under the no-bid repair program.

In April, The Sun disclosed that two companies -- one owned by the parents of Housing Authority board member Larry Jennings Jr. and the other owned by Mr. Jennings' sister -- had received contracts under the program created to reduce the vacancy rate of units owned by the agency.

Mr. Palmer's company was one of 26 minority-owned contractors to participate in the Housing Authority's no-bid repair program. Many of the 26 were small home improvement business that had never beforedone work for the government. Together, they renovated 579 units at a cost of $11.5 million, or about $20,000 per unit.

The 26 firms were among 32 companies selected to rehabilitate 1,136 units in Housing Authority developments and in sites scattered throughout the city. Of the 32 firms, 11 received more money under the program than did Mr. Palmer's, Housing Authority figures show.

In an interview last month, Mr. Henson said he was particularly proud of the number of minority-owned firms in the program.

"I don't think that there's ever been an effort in this town at least to utilize minority contractors on a program like this to the extent we tried to do," Mr. Henson said. "I think that's an important side benefit to the program."

Mr. Henson launched the no-bid repair program in spring 1993 to reduce the authority's 2,400 vacant units, out of a total of about 18,000.

To speed up the repairs of the vacant units, many of which were being trashed and vandalized, Mr. Henson declared a housing emergency. That declaration allowed the agency to bypass normal procurement rules and offer jobs on a no-bid basis. The last of the contracts were awarded in December.

The program reduced the number of the authority's vacant units to 1,600, Mr. Henson said.

But it also drew the attention of federal prosecutors, who in March subpoenaed the records of eight companies involved in the program as part of a probe into possible corruption in the Housing Authority.

Six of those companies were among seven contractors that in late March and April received letters from the Housing Authority asking them to correct deficiencies in units they repaired under the program. The deficiencies were discovered by HUD inspectors as part of a broad audit of the city Housing Authority.

Mr. Palmer's firm is not among those whose records were subpoenaed, or that received letters from the Housing Authority.

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