The $1 Million Mistake
The BMHA guy who was arrested last summer? In the end, that cost us big
Remember last summer, when a 20-year employee of Buffalo Municipal Housing Authority was charged with extortion, bribery, and witness tampering?
John Fischer, the agency’s capital improvements administrator, was accused of bullying a contractor to do a free roofing job for a friend in Sanborn in exchange for continuing work with BMHA. The contractor, Michael Hayes, contacted the FBI, and Fischer was subsequently charged by the US Attorney and dismissed from his job.
One consequence to the case was resolved last month, and it cost BMHA about $1 million.
Hayes’ company had won a bid for three roofing jobs at BMHA propoerties: the Jasper Parrish Homes, Shaffer Village, and the Ferry Grider Homes. The contract was worth about $1.8 million. But Hayes was sorry he’d bid so low when his workers began to tear off the roof at Ferry Grider and discovered asbestos, which turned the job into a costly nightmare.
Hayes asked for a change-order that would add $200,000 to his contract, to cover asbestos remediation. But BMHA’s board decided it would prefer to bid out the asbestos remediation. Here’s where Fischer put the screws to Hayes, apparently: Fischer told Hayes that if he wanted his company to win the asbestos contract, he’d have to do some free work for Fischer’s friend in Sanborn. Hayes called the FBI, and an investigation ensued.
When Fischer was arrested, the FBI and the US Attorney suggested that the investigation was ongoing. They wanted to determine whether other contractors had suffered similar treatment.
The board of BMHA responded by suspending all of Hayes’s contracts. They wanted to wait to see where the investigation led.
This, of course, upset Hayes, who felt he had done nothing wrong. It was likewise no good for the Ferry Grider homes, where demolition had already started. Eventually, BMHA awarded a $1.2 million contract to Landmark Construction to perform the work at Ferry Grider.
American DND, the company with which Hayes is affiliated—and which made a $1,000 donation in January to Byron Brown’s campaign fund—hired legal counsel and suggested it might sue. Last month, on advice of its legal and capital projects team, BMHA’s board reinstated American DND’s contract for the Shaffer Village and Jasper Parrish Homes roofs—at $2 million, the original $1.8 million plus $200,000.
So the three roofs, originally bid out at $1.8 million to a single contractor, are now being completed by two contractors at a cost of $3.2 million.
Call it a corruption tax.
BMHA’s executive director, Dawn Sanders, did not respond to phone calls seeking comment. Hayes could not be reached through American DND.
—geoff kellyblog comments powered by Disqus
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