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Perez Trial: City Official Testifies About Developer's Shoddy Work

Jurors in Mayor Eddie A. Perez's bribery and larceny trial got their first taste Wednesday of the kind of decision they're going to have to make in the jury room about six weeks from now.

Opening day in the mayor's felony corruption trial centered on how the mayor and other city departments dealt with Perez confidant Carlos Costa as the contractor struggled to complete the troubled Park Street restoration project — a $5.3 million job whose cost has potentially ballooned to more than $8 million and is still tied up in court.

Costa, whose extensive, deeply discounted work on the mayor's house gave rise to the bribery case, ended up finishing the Park Street job in 2008, 2 1/2 years late, and has sued the city for nearly $3 million in additional payments.

No one disputes that the streetscape project in the busy, densely populated Park Street neighborhood was challenging, that merchants were screaming about disruptions and that delays and disputes between Costa and the city over workmanship and contract specifications had further marred the project.

The question for the jury raised by Wednesday's testimony is this: Did Perez, as the defense contends, leave Costa on the job because the mayor exercised his judgment and chose the least costly option, even though it meant overriding actions that city construction officials were taking to force Costa to improve or face termination?

Or, as the prosecution asserts, did Perez ignore problems that had turned the Park Street project into a nightmare just to keep a friend in the money and continue a pattern of favors?

John McGrane, the city's assistant director of public works, was on the stand all day.

He testified that he wrote a letter on May 8, 2006, to Costa's insurance-bond company about the long-standing problems with Costa on the Park Street project. McGrane asked the company to take action to ensure completion of the job, including pulling Costa's performance bond, if necessary. And he asked the company to meet with city officials about possibly terminating Costa's contract for the project.

The letter, as it turns out, never reached the bonding company. But Costa got his copy in the mail and promptly threatened to sue the city if it didn't withdraw the letter.

Eight days later, on May 16, 2006, Charles Crocini, director of capital projects who reported directly to Perez, wrote a letter to the bonding company rescinding McGrane's call for action. The letter kept Costa on the job.

Crocini had attended a meeting in January 2006 in which city officials agreed that Costa's bond should be pulled and his contract terminated. Crocini had voiced his agreement and was part of the consensus, McGrane testified.

McGrane said he then drafted a memo that laid out three options: firing Costa and rebidding the remainder of the project, a time-consuming and costly process; leaving Costa on the job, which McGrane surmised would mean continued problems; and enlisting the bond company to pull Costa's performance bond and handle the responsibility of completing the project or repaying the city.

Prosecutor Michael Gailor asked McGrane if he found it odd that Crocini would write a letter countermanding precisely what the officials had agreed to do with regard to the disastrous Costa contract.

"Yes, I found it odd," McGrane said. "I was very surprised to see the [Crocini] letter come out saying disregard the letter I had sent."

The prosecution contends that Perez ordered Crocini to write the letter to protect Costa.

But under questioning from defense attorney Hubert Santos, McGrane acknowledged that Crocini, in his letter to the bond company, essentially chose option No. 2 from McGrane's own memo, though McGrane said that the document was only a draft. McGrane also acknowledged that Crocini, a professional engineer who was in charge of the school construction projects, was something of a troubleshooter who had helped mediate issues on another public works job — the building of the new city library.

"Is it fair to say there were no really good options on Park Street?" Santos asked McGrane.

"That's probably fair," McGrane said.

"And someone had to make a judgment call, right? And that's not your job, right?" Santos said.

"It would be my boss," McGrane said.

"And you reported to [former Public Works Director Bhupen Patel] and Mr. Patel reported to the mayor, right?" Santos asked.

McGrane nodded.

The prosecution alleges that in 2005, while the Park Street project was under way, Costa performed $40,000 worth of home-improvement work on Perez's house. The mayor, a Democrat who is serving his third term in office, paid $20,000 for the work nearly two years after it was completed, immediately following his initial questioning by investigators in 2007. During that interview, the state contends, Perez told the investigators that he had already paid for the work.

Perez also is charged with criminal attempt to commit first-degree larceny by extortion and coercion for allegedly allowing political power broker Abraham Giles to maintain lucrative parking-lot deals without valid city contracts. In return, the warrant says, Giles, a former Perez adversary, threw his political weight behind the mayor.

Copyright © 2014, The Baltimore Sun
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