Collins firm backing out of contract with county
Appearance of conflict cited on Volland issue
Published: March 03, 2009, 12:30 am
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Erie County Executive Chris Collins said Monday that one of his companies, Volland Electric Equipment Corp., will back out of an up to $90,000 county contract to repair small motors for the county sewer system.
Collins also said he will ask any company he owns whole or in part to refrain from bidding on county work.
“Even the appearance of a conflict of interest under the law is something I cannot allow,” Collins said in a statement, in which he also complained that the Volland matter had allowed “career politicians” to distract the government.
Legislators were crying foul about the Volland contract, and other questions had emerged. For example, the county executive’s Purchasing Division was awarding the contract to Volland even though its hourly labor rate was $15 higher than its nearest competitor’s.
Volland’s president and chief executive officer, Chris Graham, said earlier Monday that his company was already at work for the county, even though the contract was still awaiting approval from the county’s state-appointed financial control board.
“This was a sealed-bid project. We bid it fair and square,” Graham said before the Collins announcement. Graham had said that Volland should not be barred or restricted from county work simply because Collins is an owner.
But Collins said he had spoken with Graham’s father, also an owner, and persuaded him to remove Volland from county work.
Collins owns a minority stake in Volland Electric Equipment, and he served as company treasurer until he took office as county executive.
The value of his investment in the company and its real estate exceeds $300,000, according to his most recent personal financial-disclosure statement, a document that government leaders file to help flag potential conflicts. In it, Collins mentions Volland as a potential bidder on government contracts.
A Collins spokesman, Grant Loomis, has stated that Volland’s higher labor rate — $47.50 an hour — would rarely come into play as Volland repairs motors for the sewer system. But the head of the company that held the contract last year — and was outbid by Volland for 2009 — said the labor rate comes into play all the time.
Armor Electric owner Thomas Pawlak said that under the county’s system, he based nearly all estimates for as-needed repairs on labor and materials. He was intending to charge the government $32.50 an hour for labor this year, $15 an hour less than Volland.
The Purchasing Division had asked bidders for their price to fix each of dozens of select motors — the same process used when the work was last bid, in 2005. On the value of those dozens of jobs, Volland beat Armor’s bid by less than 2 percent.
But Volland would have had to adhere to those bid prices only when repairing those exact motors. Pawlak said the vast majority of the motors that Armor Electric repaired for the county over the last three years were not among the motors for which the county sought bids.
So Pawlak would then work up a new repair estimate, based on his labor rate and the cost of materials.
Volland’s Chris Graham said he would have used the same method, with his higher labor rate. But he predicted he could have performed repairs quicker and with less markup on materials.
Pawlak had argued that companies Collins owns should be barred from county business because of the advantage that the county executive and his appointees could give to those companies if they wanted.
mspina@buffnews.com
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