HUD probes barred contractor Agency to decide if Lanocha got contracts via in-law's firm

January 18, 1998|By John B. O'Donnell and Ronnie Greene | John B. O'Donnell and Ronnie Greene,SUN STAFF

A Baltimore contractor barred from public construction work after admitting that he paid housing officials cash and gifts has re-emerged as a key figure in a new company winning more than $1 million in city work, records show. After a corruption probe, Timothy Lanocha was prohibited for two years from winning contracts financed by the federal government beginning in February 1995.

But since 1994, records show, Lanocha had worked for a new company, Botech Inc., which is headed by his father-in-law. Lanocha's wife, Cristina, provided money to help get it started. And Lanocha himself has had supervisory duties at construction sites.

During Lanocha's debarment, Botech won at least $1.4 million in federally financed work.

The tale of Lanocha Construction Inc. and Botech Inc. offers an insight into rules designed to prevent convicted contractors from continuing to get work that is subsidized with taxpayer funds.

And now, the U.S. Department of Housing and Urban Development is reviewing whether Lanocha and Botech violated the federal rule designed to deny Lanocha government money.

On Jan. 9, after questions from The Sun, HUD asked Baltimore Housing Commissioner Daniel P. Henson III to detail his knowledge of "the relationship, if any, between Botech Inc. and Timothy Lanocha" and to supply a list of all projects awarded to Botech during the debarment.

"We are going to take a look at these issues and look at whether there has been a violation of the terms of the debarment," said Alex Sachs, a HUD spokesman. "We are going to ask the principals involved for details on the relationship between the debarred person Lanocha and the firm."

Henson aware

Henson has been aware of ties between Botech and Lanocha since at least 1995, when an aide alerted him to possible complications in the award of a contract to the new firm. But after a legal review, Henson determined Botech could continue as contractor on the $1 million renovation project.

"The issue of Botech being a Lanocha front has come up for several years," Henson said Friday.

Today, he said, "our information" shows that neither Timothy nor his brother William W. Lanocha Jr., former vice president of the debarred firm, is an owner of Botech. Nor has either been a supervisor on projects financed through Henson's agency, he said.

Asked about Cristina Lanocha's role in Botech, Henson said: "I can't debar everybody's wife."

"They are not debarred," Henson said of Botech. "Either they are the low bidder or the most responsive bidder for work we offered or advertised to the general public. Given the fact that they could post insurance and bonds, we would be remiss if we didn't take them."

The commissioner noted he had recommended Lanocha's debarment.

Denies connection

Botech President Carlos E. "Bob" Oreamuno says there is no connection between his company and Lanocha Construction.

"We're not the same company," Oreamuno said in a brief December interview. "We started out as an honest company and we've continued that way. We've done good work for the city."

Oreamuno declined to comment in detail and did not respond to two letters seeking an interview. Neither Timothy nor Cristina Lanocha replied to a phone message or letters requesting an interview.

In 1995 and 1996, Oreamuno described Lanocha as a Botech employee. But in 1997, he told city officials Lanocha was not an employee, but rather a Botech consultant -- through another firm, AHL Inc.

Asked if the Botech work violated the debarment, Lanocha's lawyer, Herbert Better, responded: "I think that requires an understanding of debarment law. I'm not going to get into that."

The investigation leading to Lanocha's troubles began in March 1993, when the U.S. attorney's office and the FBI began an inquiry into alleged bribes and gratuities paid by contractors to employees of the Housing Authority of Baltimore City.

Paid city engineer

The initial target was John Dutkevich, a housing authority project engineer allegedly paid by several contractors. Authorities said the Lanocha brothers paid Dutkevich $1,400 in connection with work on the Emerson Julian Homes housing project in 1993.

At first, the Lanochas cooperated with the government and were treated as witnesses so long as they were truthful. In November 1993, the brothers testified before the grand jury, where both acknowledged paying Dutkevich. Asked whether they had paid any other official, both stated: "No."

The government developed evidence to the contrary. For instance, the Lanochas provided about $3,000 cash, an air rifle and binoculars to Charles Morris, who administered the housing authority's $26 million vacant house repair program, records show.

In March 1994, a subpoena went to the Lanocha firm, seeking records of payments to public employees other than Dutkevich. The firm had won $3 million in no-bid construction repair work for the housing authority. Two months later, Botech was incorporated.

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