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News Maryland Sun Investigates

Lead paint judgments against Baltimore inflated by delay

Justice delayed is justice denied, so the legal maxim goes. Judgments delayed, however, can be downright expensive.

Last week, the Housing Authority of Baltimore City announced that it had paid $6.8 million to satisfy outstanding court judgments that the agency had allowed six former tenants to become lead-poisoned while living in public housing as young children.

Those checks, though, represented just the final installment in a series of payments made over the past 13 months to comply with the judgments, which were four to six years old. The total price tag was much higher.

In all, the authority paid $11.3 million to satisfy those six judgments — a 50 percent markup from what the agency would have owed had it paid promptly.

The original judgments totaled $7.5 million when they were rendered, according to the housing authority. But as judgments dating to 2007 went unpaid and interest accrued annually at the rate of 10 percent, the agency wound up paying nearly $3.8 million more.

Housing Commissioner Paul T. Graziano said he always intended to pay the judgments. But he said he wanted to deal with them as part of a "global resolution" to the large number of lead-poisoning lawsuits the agency faces. As of last week, there were 316 other pending cases claiming more than $900 million in damages, authority officials said.

Efforts to deal with all the lawsuits together ultimately proved fruitless, Graziano said last week.

Last year, the authority paid nearly $3.7 million in one of the six cases. For that payment, it used money received in liquidation of insurance companies that had once covered the authority. It made another payment of $866,000 last month from the same source.

But Graziano maintained that he needed federal approval to pay the rest because virtually all of the authority's money comes from Washington — about $250 million this year. The funds the authority used to cover the final payments came from federal funds that otherwise would have helped 700 low-income Baltimore families afford rent in private housing, officials said.

"We never refused to pay these judgments,'' Graziano said. "What I always made clear is I was not authorized to pay. The mayor couldn't authorize me. This was a housing authority issue. The U.S. Department of Housing and Urban Development was the only entity that could authorize payment. They gave us a letter of approval on Aug. 7. We wrote six checks the next day."

A HUD spokesman said a request for permission from the housing authority to use federal money to pay the judgments came in a letter dated Oct. 22, 2012. At that time, according to authority figures, interest was piling up at the rate of $1,635 per day.

Baltimore Sun reporter Luke Broadwater contributed to this article.

tim.wheeler@baltsun.com

Copyright © 2014, The Baltimore Sun
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