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Law firm criticizes Martinsville's handling of no-bid, no-contract construction deal

Attorney critical of city response to inquiries
Posted: 5:15 PM, Nov 21, 2018
Updated: 2018-11-22 04:46:55Z

MARTINSVILLE, Ind. – One year after a Call 6 Investigation into a no-bid, no-contract deal that cost the City of Martinsville half a million dollars, a law firm has announced the findings of its investigation into the matter.

The Martinsville city council released a three-page analysis Wednesday from Bloomington attorney William Beggs of law firm Gunger & Robertson.

The city paid Roberts Construction $564,130 during 2017 without a bid and without a contract to perform sidewalk improvement, concrete work, and vegetation excavation.

Call 6 Investigates investigation found taxpayers had paid Roberts Construction $662,310 since 2016.

PREVIOUS |  CALL 6: Martinsville paid $662K in construction claims with no bid, no contract

“We were made aware of no evidence of a bidding procedure of any kind, of a quote procedure of any kind, of the solicitation of at least three quotes for work eventually performed by Roberts, of the availability of plans and specifications for review by bidders, or that there was any open and public awarding of work to Roberts,” Beggs said in his report to the council.

Beggs said doing so put the city at a financial risk.

“Some of the effects of these deficiencies were that Martinsville had no written contractual remedies in the event of non-performance, and Martinsville had no evidence of insurance or any assurance of ability to satisfy damages in the event of claims,” said Beggs. 

Beggs also said the city council’s concern over the matter prompted the City of Martinsville to improve its policies and procedures in a city report released in May.

READ | Martinsville failed to follow public purchasing laws for years

Beggs report criticized the city administration for not responding to council’s questions about Roberts construction dating back to mid-2017.

“We conclude that it is regrettable that the City administration was not forthcoming with responses to requests for information about sidewalks that started as early as the summer of 2017,” said Beggs in his report. “It seems to use the better course would have been to address the requests, identify the non-compliances early, and correct them promptly so as to dispose of this problem much sooner and without the Council being left with no choice to take the action it eventually took.”

Beggs said he did not find any evidence that Martinsville was charged for work that was not performed nor did he find complaints about the quality of work.

The report ended with a recommendation for the city to follow the procurement practices outlined in the city report released in May.

The city review suggested Martinsville make numerous changes including establishing rules for purchases of services, setting up specification policies, and designating city departments as separate purchasing agencies.

Call 6 Investigates worked to get several responses to Beggs’ report released Wednesday.

Council members Kris Fuller and Eric Bowlen were the most vocal about seeking an investigation into what happened with Roberts Construction.

“The goal when the Council brought this issue to light and began this investigation was to make sure that State law was being followed and to protect taxpayer money by encouraging open, transparent, and fair competition for those projects involving taxpayer money,” Kris Fuller told RTV6.  “As a Council, we made a decision to make sure things will be done fairly and correctly in the City of Martinsville and going forward we will continue to have a watchful eye to assure that occurs.”

Council member Eric Bowlen said the law firm’s report confirmed the city failed to meet minimum the state’s minimum requirement in the procurement process.

“We feel that the administration would have continued not meeting the requirements had we not, as a council, raised the red flag,” said Bowlen in a statement to RTV6. “A local municipality can make their own procurement process tighter than Indiana Code. However, they cannot make it looser than Indiana Code. In this case, the administration was making it looser, and the council wanted this addressed and stopped.”

Call 6 Investigates also contacted city attorney Anne Cowgur with Taft Stettinius & Hollister, who said she did not want to rehash issues that had been discussed for more than a year.

“The report acknowledges that Mr. Beggs was retained to in connection with investigating purchasing policies and procedures followed by the City with respect to Roberts Construction,” said Cowgur in a statement to RTV6. “However, in the end, the letter is more of a report on the report of the City Attorney and a recommendation that the City follows the policies and procedures outlined by its City Attorney in that report.  To the extent that Mr. Beggs opined that if the Council had not insisted on an investigation the Council had no reason to believe the City administration would have instituted any changes, this is inconsistent with the reality that the new City Attorney (having just replaced the resigning City Attorney a year ago when these issues were first raised), had already begun to identify the need for changes from long-standing practice in multiple areas.”

The city council hired Bunger and Robertson at $295/hour to investigate whether the city followed proper procedures and laws.

Call 6 Investigates requested information on how much the city paid the law firm to investigate the matter.

In a statement released in May , Mayor Shannon Kohl said the city inherited many practices that had no written policy.

“In the early fall our City was dealing with many issues, including issues with our then-Parks Director, the parking structure, contracts to be renewed, and as you are at this point well aware, the questions regarding the sidewalks program,” said Kohl in a statement to Call 6 Investigates in May 2018. “As our new City Attorney was helping to address these issues, the frequent refrain was the lack of any written or otherwise established policy or procedure.  That is why I asked our City Attorney to advise me, the council and our department heads concerning the appropriate policies and procedures for moving forward.”

The city initially halted work with Roberts Construction,  but the company is back to work in the City of Martinsville.

Records show Kohl’s former brother-in-law and the president of Roberts Construction, James Roberts, donated $1,000 to Kohl’s mayoral campaign in 2015.

Kohl said she was the one who asked Roberts for the donation, and emphasized she called numerous companies at the time seeking $60,000 in campaign contributions.

The city’s 70-page report said any allegations regarding a conflict of interest are “reckless and unfounded.”

“It is nothing more than a bald and uninformed attempt to discredit you and your office, made even bolder because the former City Attorney signed the claims and the council approved them, until it became disadvantageous,” read the report addressed to Mayor Kohl. “It is apparent on the face of the law that there is no conflict of interest.”

Read the full 70-page city report here .

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