The Baltimore Development Corporation, the city's quasi-public development arm, over the past year and a half awarded six contracts totaling $2.3 million to demolish buildings without publicly advertising the work, documents have revealed.
Each of the six contracts was worth more than $25,000, the amount that is supposed to trigger public notice when work is requested by city agencies. Instead, the BDC asked companies for their prices, and, in the case of two contracts - including one for $1.5 million - did not award the work to the firm offering the lowest price. The BDC was in the process seeking a seventh contract - this time for warehouses occupied by a nonprofit - when The Baltimore Sun reported on the practice last month.
The list of contracts includes four that were not known publicly. It is the first full accounting of demolition work initiated by the BDC, which in theory is supposed to only make recommendations about development to the mayor and City Council, not actually engage in public works.
At the request of Baltimore Mayor Sheila Dixon, the BDC has halted the practice of bulldozing buildings, including rescinding a $1.5 million contract that had been awarded to knock down eight buildings on a downtown block. The BDC also curtailed the search for a firm to demolish a cluster of warehouses at the site for a garage for the proposed slots casino.
In each instance, the BDC contacted anywhere from two to eight demolition firms and asked them to submit prices on the work. For each contract, the BDC included at least one minority-owned firm in its list.
"I just believe that it is better to have an open and public process," Dixon said. "They should be transparent and be sure that all people get those opportunities" to win contracts.
The mayor said she has faith in the agency, particularly what she called its strong board of directors, and viewed the demolitions as a rare instance where she said the BDC moved "more quickly than they should have without checking things or fully vetting them."
Each of the awarded contracts was approved by the city's housing commissioner, Paul T. Graziano, who said that he had believed the BDC followed the city's procurement rules when he signed off. Though the BDC is technically a nonprofit, its authority to negotiate on behalf of the city comes from the housing department.
The deals were also approved by the city's Board of Estimates, which rarely engages in public debate about spending unless a contractor raises concerns about an award.
Baltimore Development Corporation's president, M. J. "Jay" Brodie, said he believed his organization had the power to award contracts to demolish buildings and thought his agency did not have to follow city processes because it is allowed to circumvent city rules when it contracts with other types of third parties, such as consultants and appraisers. He concedes that he did not check the myriad of agreements and memorandums that govern the BDC.
"I didn't go back and look at the source material which you might argue I should have done myself," Brodie said.
But, even if he had, it is unclear that he could have easily arrived at an answer. Unlike the more recently formed quasi-public agencies like the Parking Authority, the BDC does not have a charter and was not created by a statute, leaving some of its powers and authorities uncertain.
"We all have varying levels of information on what BDC is allowed to do," said Baltimore City Solicitor George Nilson. "There is not an easy way for the law department to look at BDC and simply say 'Here is what you can do. Here is what you can not do.' "
Instead BDC employees share knowledge about the organization's limitations through institutional memory. "For those of us who have worked at BDC, [the rules] passed on from generation to generation," said Deputy Mayor Andrew B. Frank, who worked as a BDC executive vice president before joining Dixon's administration.
BDC critics say that such a fluid understanding of the agency's authority gives it unfettered latitude, particularly because until 2006 it operated outside the state's open meetings rules. M. Albert Figinski, an attorney who is challenging whether the city has the authority to outsource urban renewal authority to the BDC, has called it a "rogue" agency that "is acting beyond the wildest conceptions of their legitimate role."
Figinski wants the Superblock project in the 200 block of W. Lexington St. re-bid in part because the current agreement includes a piece of land not in the initial bid and out of concerns that the developer will tear down important historic buildings.
Dixon disputes Figinski's characterization of the agency, saying that the deals the BDC negotiates are scrutinized by its board, the City Council and the Board of Estimates. Nonetheless, she has asked her law department to review the BDC's authority. Nilson is in the process of gathering all of the documents that govern the agency.