New Orleans city officials have vowed to ban the contractor from future work over the Treme construction dispute, but some say they have been unfairly vilified and scapegoated, while others question whether the city can legally enforce such a ban.
The owner of Commando Construction Industries claims the company is being blamed for delays the city actually caused.
“It is unfortunate that the administration has attempted to scapegoat Commando Construction, but the record is clear that the city’s poor design and the Sewer Department’s failure to shut off the water valve allowed work to be completed on the Treme B project before stalling,” Kelly Commando said in a statement. “We share the frustration of our residents that the city has allowed this issue to go unchecked for nearly two years.”
Mayor LaToya Cantrell’s administration agreed to pay the command center $8 million in FEMA funds to repair roads and infrastructure on a 40-block block of Treme Lafitte starting in late 2020. But progress stalled when command center crews reached the final section of the project at St. Peter and North Villere streets last year, when the city realized more work needed to be done outside the original project scope.
At a city council meeting on Sept. 5, officials said they had been negotiating with the command center for months about changing the plans to include the additional work, but they reached an impasse and the contract was terminated in May.
Since then, St. Peter Street has become impassable and overgrown with weeds.
Complaints from residents living near the partially demolished road brought it to the attention of City Councilman Freddie King, who voted unanimously to declare it an “immediate threat” earlier this month, clearing the way for Mayor Cantrell’s office to put the remaining work, which will cost the city about $1.5 million, out for emergency bids.
The commander says that price is more than her company was asking for to complete the job.
“It doesn’t make economic sense for the city to spend $1.5 million when we could have agreed to a plan change with Command Construction for a fraction of that cost,” Commander said.
At the City Council meeting, Joe Surette, the city’s deputy chief operating officer for infrastructure, said the company would not be able to win new contracts because of the Treme project.
“We are going through the process to ensure that the contractor will not do any more work for the city,” Surette told council members.
Weeks have passed and the city has not backed down on its claims, but Commander, industry experts and a review of the laws governing public works contracts have made it clear that Threatt may not be able to keep his promise to keep Commander out.
“Cities and public entities don’t have the discretion to deliberately and purposefully decide who they do business with,” said Scott Hedlund, an attorney who has practiced construction law for nearly two decades. “I think the logic is that we’re spending taxpayer money on the public interest, on construction, on things that the public entity needs, and we don’t want that public money to be spent on any kind of favoritism or cronyism.”
The law says city officials must accept the “most responsive and responsible bid.” By the law’s definition, a command center is considered “responsive” as long as it submits required documentation on time, and is “responsible” as long as it holds the proper licenses and is in good financial standing.
This could mean that if Command receives a contract with the lowest bid in the future, the city would have to work with the company again unless it is found not liable. That decision would have to be in writing, and Command would have the opportunity to hold a hearing before the city could hire another contractor.
The company can also sue if the command disagrees with the city’s findings.
“There’s certainly no law that says you can’t accept a bid from someone because you don’t like them or because you think they’ve done bad work in the past,” Hedlund said.
Hedlund said the city may have the power to sue if the contract was terminated for reasons allegedly attributable to the division, but he said if the contract was terminated for convenience rather than for cause, that’s unlikely to be used against the company for future projects.
Andre Kelly, a spokesman for the Louisiana General Contractors Association, also questioned the ban, saying he understood the city needed to reprimand companies for shoddy work, but that it had to do so within the bounds of the law.
“The municipality cannot reject a company if they’re licensed, insured and meet all the requirements,” Kelly said. “If a properly licensed company submits a bid, they can’t reject the contract.”
City officials did not respond to requests for comment on the commander’s claims and assertions that the ban is unenforceable.
Commander, who employs about 170 people, said both the termination of his contract in May and the allegation that he would be barred from future work came as a surprise to him, as he felt he had a good working relationship with the city, having completed about $75 million in projects in the past four years alone.
Commander said the dispute will only make it more difficult for the city to find contractors in the future and increase businesses’ concerns about issues such as late payments. Commander said the city has owed her company nearly $1 million for months and that in the past it was owed as much as $4 million, an amount that is unmanageable for many businesses.
“It’s no secret that a lot of contractors don’t want to work for the city of New Orleans because of issues like this and the city’s inability to pay its bills on time,” Commander said.
