Bank files suit on 2 loans

Allfirst says builder of police pistol range owes $1.2 million

Company notified in May

June 16, 2000|By Mike Farabaugh | Mike Farabaugh,SUN STAFF

Allfirst Bank is suing the company that constructed Maryland's new police training center in Sykesville, claiming it has failed to pay off $1.2 million in loans.

The bank's lawsuit named as defendants EnviroServe Inc. and UMS Inc., both of the 7400 block of Buttercup Road in Sykesville, and Mario Reiriz, president of both corporations. EnviroServe was the general contractor for the center.

Allfirst contends that Reiriz signed promissory notes Dec. 17, guaranteeing repayment of loans in the amounts of $1.75 million and $425,000. Interest grows by $272 each day the loan is not paid, according to the lawsuit filed Tuesday in Carroll County Circuit Court.

Attempts to contact Reiriz yesterday were unsuccessful.

EnviroServe was notified by the bank in May that payment was expected, according to the suit.

William Huddles, a Columbia attorney representing EnviroServe in its claim against the Maryland Department of General Services (DGS), said yesterday that he did not know whether the December loans Reiriz made with Allfirst were related to extra work EnviroServe had to perform to finish the firearms center.

Dave Humphrey, a spokesman for General Services, said yesterday that through April 10, EnviroServe has been paid more than $3.8 million on the base contract of nearly $4.2 million.

The $400,000 difference includes money the department withheld as a penalty because it claims the contractor failed to complete the job on time, he said.

"DGS is not involved in any dispute between the bank and EnviroServe," Humphrey said.

General Services accepted the project as essentially completed early last month, Humphrey said. EnviroServe has not billed the state for several hundred thousand dollars, he said. EnviroServe has said the bulk of the extra work and cost overruns are associated with steel bracing to support baffles that cover four pistol ranges.

Department officials said EnviroServe worked too slowly and should never have taken six months to get the extra work done. EnviroServe has said it was slowed by poor design and by changes General Services wanted made before and after construction began.

As a result, both parties have agreed to go before the Maryland Board of Contract Appeals in April to settle the dispute.

Gail Gibson, a spokeswoman for Allfirst, said in a statement: "Our relationship with EnviroServe is confidential, and we are not at liberty to talk about it. We have many different customers in many different businesses. The common goal that binds them all is a desire to be successful and it is in our best interest for our customers to meet their goals."

Some subcontractors, such as Hallco Enterprises Inc. of Clarksburg, say they are entangled in EnviroServe's problems and have not been paid all money owed them.

Ted Hall, owner of Hallco, a painting company with a dozen employees, said yesterday that he is owed about $100,000 for work at the firearms range. His contract with EnviroServe stipulated that he gets paid when the state pays EnviroServe.

"I was paid on the base contract work, but have not gotten a cent for the extra work," Hall said. His company painted the extra steel bracing at the pistol ranges.

"I'm just trying to make a living for my wife and kids, and keep my employees working," Hall said. "I've had to make a deal with the IRS to pay my taxes and with my suppliers, just so I can stay in business."

Until EnviroServe resolves its disputes with the bank and Department of General Services, Hall figures he won't be paid.

"Right now, I'd settle for getting just some of what I'm owed," he said.

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