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When Eagle Maintenance Services recaptured the District’s recycling contract in May, even though it had botched the city’s recycling in 1993 and 1994, the message to rival firms was as clear as a mob hit. No matter what, Eagle—the only home-grown, minority-owned competitor for the contract—can count on the city’s business.
But given Eagle’s performance during the first two months of its new contract, the firm certainly doesn’t deserve the D.C. government’s favors.
According to city officials and Eagle’s bid proposal, the North Capitol Street firm beat four other companies to the contract by offering the low bid and enough promises to the D.C. government to fill a dumpster. Eagle vowed to do everything but stop global warming, including hiring laid-off Department of Public Works (DPW) employees, giving job preference to D.C. residents, awarding 75 percent of its subcontracts to “small and disadvantaged businesses” (whatever that means), and pouring 21 percent of its recycling profits back into District coffers. The bid-ranking sheets show the competition wasn’t even close. DPW officials ranked Eagle’s bid more than 22 points ahead of the second-place firm, Browning-Ferris Industries.
Nearly halfway through the four-month emergency contract, however, city officials say Eagle has yet to pay a penny to the city. (“But we are confident that Eagle Maintenance will live up to the agreement, and we look forward to receiving a check shortly,” says DPW spokeswoman Linda Grant hopefully.) The collection of recyclables is being handled by subcontractor Waste Management Services, which is hardly a “small or disadvantaged” firm: It’s the largest waste-collection business in the country. Eagle is also hiring day workers out of Maryland halfway houses and shelters. Losing competitors contend that Eagle is paying the homeless and halfway-house residents low wages and no benefits so as not to exceed its low bid.
Eagle’s reliance on this unusual employment pool came to light last week after a Waste Management Services employee was injured when a worker hired from the Save the Seeds Ministry mission in Indian Head, Md., pulled the wrong lever on a trash truck.
Eagle President Richard Tynes Jr. claims that all the workers he hires from the Indian Head mission and other places in Maryland are D.C. residents.
“Just because he’s in Maryland doesn’t mean he’s not a District resident,” says Tynes, who asserts that he also hires from D.C. homeless shelters and halfway houses, as well as through the D.C. Department of Employment Services. Tynes refuses to discuss wages, but says that Eagle employs between 38 and 110 workers, depending on the season.
The Rev. Tim Glover, who directs Save the Seeds Ministry, confirms that “three-fourths of our residents are from D.C. Guys in D.C. are having problems. They come here to get some help, then they go back home.”
Tynes also claims he’s hired most of the former D.C. workers who have applied to Eagle, but says he doesn’t know how many ex-DPW employees are working for him.
Another sore point, particularly with D.C. Councilmember Harry Thomas, is that Eagle and Waste Management continue to store and sort recyclables at a controversial Queens Chapel Road NE facility in Thomas’ Ward 5. The council has been trying to close the site for several years, but has lost several court battles with the facility’s owner, Northeast Distribution Center. Thomas is annoyed because Eagle’s proposal indicated that the firm would rely principally on a Maryland dump instead of the one in his ward.
Tynes says that when Eagle finishes remodeling and expanding its North Capitol Street plant, it will handle all recycling there. But that construction won’t be finished before September, around the time the emergency recycling contract runs out.
Of course, judging from the way the city has sucked up to Eagle so far, the firm will be collecting recyclables long after September. The city suspended its two-year-old recycling program in April after losing an estimated $2 million because Eagle had been unable to resell the old newspapers, glass bottles, aluminum cans, and plastic jugs at a profit to the city. And the city’s Contract Appeals Board ruled that Eagle had been awarded the $5-million-plus contract illegally when the recycling program began in 1993. According to the board, Recycling Solutions Inc. (RSI), a Prince George’s County company, deserved the 1993 contract.
So when Eagle won the five-way competition for the emergency contract for the remaining months of fiscal 1995, rivals shook their heads in amazement and walked away. When the fiscal 1996 recycling contract comes up for bidding in a few months, Eagle could well be the only participant.
RSI, which finished a distant third in the competition for the current emergency contract, says it no longer wants the headaches of doing business with the District government. “Our families have a long history of providing services to the District and have regularly sought District contracts,” says RSI President and co-founder Alan Bortnick. “My experience with the D.C. recycling contract, however, seriously tests our commitment to the District.”
RSI attorney Robert Dustin called for a congressional investigation into Eagle and DPW during a July 12 House hearing on D.C. contract problems. “All of these facts suggest the need for an in-depth investigation of the relationships between senior DPW officials and Eagle Maintenance, and close scrutiny of the decision-making processes at the Department of Public Works,” Dustin told the House D.C. Appropriations Subcommittee.
Meanwhile, Eagle showed its political acumen again after a group of its former employees, all Latinos, filed suit against the company in D.C. federal court July 7, claiming Eagle illegally denied them overtime pay. The company hired attorney Paul Pascal to defend it. Pascal is the father of Craig Pascal, who works for Councilmember Thomas. Attorney Pascal and Eagle offered to pay the overtime claims the day the lawsuit was filed, but the workers rejected the last-minute offer.
BRIMMER’S HIGH WIRE ACT
Before the D.C. financial control board conducted its first public hearing July 13, House Speaker Newt Gingrich (R-Ga.) already was grumbling privately about the slow pace of the board under Chairman Andrew Brimmer. But the board seems to have wiped away those doubts after its first meeting. Brimmer and his four colleagues impressed Republicans with their demand that the mayor and the city council cut 2,000 workers and eliminate 3,600 vacant positions.
And when Brimmer made his first trek to Capitol Hill last week to report to the House D.C. Appropriations Subcommittee, he assuaged congressional Republicans again. Brimmer vowed to force the city to obey the order to slash 2,000 workers from the payroll, a tough stance that won him gentle treatment from the subcommittee. Most of the several dozen questions prepared for Brimmer went unasked, and only Rep. Henry Bonilla (R-Texas) played tough inquisitor, asking Brimmer to outline his plan for the board’s first 100 days. Brimmer successfully sidestepped the issue, saying, “I don’t live on timetables like that.”
Subcommittee Chairman James Walsh (R-N.Y.) seems content to give Brimmer a brief honeymoon—at least until Aug. 15. That’s the deadline for the board to approve or reject the mayor and council’s 1996 budget. If the board rejects the plan, or if Walsh feels that Brimmer and company have been too lenient with the city, then Walsh’s subcommittee will write the District’s budget for next year.
Subcommittee staffers already are gearing up to do in one month what the mayor and council have not been able to do in seven—devise a realistic budget for fiscal 1996, which begins Oct. 1.
If Congress does assume budget-drafting authority, Brimmer and his control board colleagues could find themselves in real hot water. Critics will demand to know why District residents are paying for the board’s downtown office space and its 35 staffers when Congress is doing the real work of cutting the budget.
PEEBLES’ BAD LUCK
Downtown developer R. Donahue Peebles is having a bad month. First, his attempt to collect a $3.6-million finder’s fee on the 1991 deal that gave the city 1 Judiciary Square suffered another setback last week when a D.C. Court of Appeals panel ruled against him on a technicality. The judges said Peebles was not entitled to the fee because he had neglected to get a D.C. real estate license. (FYI: Obtaining a real estate license in the District is only slightly tougher than getting your driver’s license renewed.)
And this week, the Washington Business Journal reported that Peebles was about to land a sweetheart deal from his old political mentor, Mayor-for-Life Marion S. Barry Jr., that would give the developer a 99-year lease on valuable Pennsylvania Avenue NW property. That story is untrue, Peebles says, and he has demanded a retraction. “I have never submitted a proposal to the city, nor have I had any discussions,” Peebles says, disputing the Journal article.
But no one doubts that Peebles hopes to a get a piece of the deal on the 6th and Pennsylvania property if he can. The mayor is trying to rush emergency legislation through the council to negotiate a 99-year lease on the building that now houses the city’s Department of Employment Services. The site is considered one of the city’s most valuable tracts, and Peebles says he is interested in competing for it when the city puts it up for bids.
But don’t expect the mayor to welcome a Peebles offer. Since returning to power, Barry has shown no inclination toward reconciling with his former protégé. The developer benefited handsomely from his Barry connections during the ’80s, but he backed At-Large Councilmember John Ray over Barry in last year’s bitter mayoral contest.
The Barry administration is already dissing Peebles in its arena plans. The city is preparing to move employees out of its buildings on the 600 block of H Street NW to make room for the new arena. But officials have ignored Peebles’ proposal to lease space in two buildings he controls—one at 801 North Capitol St. and the other at 1121 Vermont Ave. NW. He claims his deal would save the city millions over a competing proposal. But in the case of Peebles, anyway, Hizzoner seems unwilling to forgive and forget.