Federal investigators probing the Baltimore Housing Authority brought criminal charges yesterday against officers of J&M; Construction Co., one of the most prominent contracting firms awarded work under the agency's troubled no-bid repair program.
Company president James. M. Myers, 59, of Fallston, and his son, Terry Myers, 29, of Abingdon, the company's secretary-treasurer, illegally paid about $10,000 in cash to the former manager of the program, according to papers filed in U.S. District Court in Baltimore.
Beginning in November 1991, J&M; won contracts totaling more than $4.4 million to renovate about 180 homes, more than any of the three dozen other companies awarded work in the no-bid program, according to Housing Authority records. The illegal payments were made between December 1992 and October 1993 to Charles M. Morris, who managed the program, said First Assistant U.S. Attorney Gary P. Jordan.
"The investigation is definitely continuing and we expect more charges," he said yesterday.
Efforts to reach J&M; officials were unsuccessful. D. Christopher Ohly, an attorney for the company, declined to comment.
Morris, who pleaded guilty last August to accepting gifts and $22,000 from contractors, is cooperating with the FBI while he awaits sentencing. His conviction is among 10 resulting from the FBI investigation so far.
The program began in 1991 with housing officials expecting to pay $1 million to repair more than 1,000 rundown homes, and ended three years later costing taxpayers more than $25.6 million.
In a statement yesterday afternoon, housing officials, referring to the latest criminal charges, said: "The Housing Authority of Baltimore City welcomes all findings leading to uncovering any illegal activities associated to the Authority's ongoing business of helping low-income families with housing and related needs. It is especially hurtful to everyone involved when a program that results in such an extraordinary benefit to the Authority and so many of its residents is the subject of such activities."
Federal auditors cited the Housing Authority last fall for excessive costs in fixing up homes, paying contractors for work that was never done, and awarding lucrative contracts to companies run by relatives and friends of administration officials, including Mayor Kurt L. Schmoke and Housing Commissioner Daniel P. Henson III. Many of the companies were young and inexperienced.
That was not the case with Joppa-based J&M;, a family-run business that incorporated in 1971. It was among the first companies to become involved in the no-bid project, and it had years of experience doing work for the city.
According to court papers, James and Terry Myers obtained the money from the J&M; operating account and from checks the company issued in the name of subcontractors.
James and Terry Myers were charged with conspiracy to commit federal program bribery. The maximum penalty for that crime is five years in prison and a $250,000 fine.