Grand jury seeks S&WB records -- Times Picayune June 29, 2006

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June 29, 2006 Thursday

SECTION: NATIONAL; Pg. 1

LENGTH: 1587 words

HEADLINE: Grand jury seeks S&WB records;
Subpoenas involve board member, firms

BYLINE: By Gordon Russell, Staff writer

BODY:


Federal investigators are examining the connections between longtime New Orleans Sewerage & Water Board member the Rev. Benjamin Edwards Sr. and six companies that may have received S&WB contracts, according to two grand jury subpoenas sent to the agency.

The subpoenas seek records of any contracts, payments and correspondence involving Edwards or the companies. But the most detailed requests in the orders revolve around Edwards, a 9th Ward pastor whose 16-year tenure on the board has been marked by repeated controversies over his involvement in the agency's contracting practices.

The first subpoena, dated March 20, seeks Edwards' personnel file and confirmation questionnaire as well as memos he has written or that mention him. The government is also seeking "payments to" Edwards, and records of any work the water board has done on behalf of his church, Third Shiloh Missionary Baptist Church, and a nonprofit he runs, Third Shiloh Housing, according to the documents.

Edwards said he had not been subpoenaed and denied any wrongdoing. He said that, as one of 14 water board members, he has no power to grant contracts and he scrupulously avoids having any business relationships with companies that do business with the board.

"I don't know why someone would think I have the power to award a contract," he said. "That's not how it works. They give me a lot of credit, but I ain't that powerful."

Both subpoenas also requested information from the board about Management Construction Consultant Inspection Inc., or MCCI, a company that, according to state records, was not formed until three months after it began doing work for the water board last year. One of the company's principals, Bishop O.C. Coleman of Greater Light Ministries, is a minister who is friendly with Edwards. Coleman is named in the second subpoena, as is his church.

Coleman, who has previously said he did nothing wrong, refused to answer questions on the subpoenas.

The second subpoena, dated May 19, was issued by the federal grand jury days after The Times-Picayune reported on two contracts worth a total $2.5 million that MCCI received in the weeks after Katrina. The company was hired by S&WB's prime contractor Montgomery Watson Harza to help it inspect damage to the city's sewer and water systems after the storm, according to S&WB records.

The second subpoena traces the links mentioned in the newspaper story. But the first subpoena makes clear that investigators had opened a probe into Edwards and his links to various contracts, including one involving MCCI, well before the article was published.

Officials from Montgomery Watson, a national engineering firm, would not respond directly when asked whether the company had received a subpoena. Rather, the firm issued a statement saying it was "proud of the hard work and dedication our team demonstrated" in the wake of the storm.

Coinciding donations

Both Coleman and Edwards donated generously to the same candidates in the recent city elections -- often on the same day and in the same amount.

In one case, both listed the same address: 4948 Chef Menteur Highway, an abandoned bank building near Louisa Street that MCCI named as its headquarters when the company incorporated.

While Coleman and Edwards gave to many politicians, Mayor Ray Nagin was by far the biggest beneficiary. MCCI gave the Nagin campaign $10,000, while Edwards kicked in another $5,000.

On his own, Edwards also spent what he estimated to be more than $200,000 trying to get the mayor re-elected. Most of that money, an "independent expenditure" that as such was not subject to state limits on political contributions, went to pay for billboards with Nagin's likeness and campaign slogan in various evacuee hubs, including Atlanta and Houston, according to Edwards. He said he also paid for radio ads in out-of-state markets supporting Nagin.

Nagin has said he was not involved in MCCI getting the sewerage and drainage contracts, and that he was not even aware the company had gotten the jobs until a reporter asked about it in May.

Questions about MCCI

After Katrina, MCCI received emergency subcontracts from city agencies, one dealing with the water system, one with sewerage and one with drainage, according to S&WB and city records.

In each case, Montgomery Watson served as the prime contractor.

Details on MCCI's part in the drainage contract are sketchy. The main contract was worth about $24 million, but city officials have not provided details about subcontracts, saying they deal only with prime contractors.

To supply workers to help analyze the state of the sewer and water systems, MCCI billed $2.5 million. Records show the company charged taxpayers $90 to $106 per hour per worker, mostly to take off manhole covers to visually assess damage. The firm billed somewhat less for its work on the water contract, which also involved taking account of damage.

Many of the company's invoices were signed by a "B. Edwards," the documents show. Benjamin Edwards has said it is not his signature and that he did not work for MCCI. Two MCCI employees said they were paid about $20 an hour.

One worker, Darold Hughes, said he was not familiar with Benjamin Edwards, but that he had been hired at the firm by a Bruce Edwards.

The other worker, who spoke on the condition of anonymity, said that "B. Edwards" was Bruce Edwards, Benjamin Edwards' brother. His account was confirmed by a source close to the investigation.

Benjamin Edwards said he has a brother named Bruce Edwards but he is not involved in MCCI. A phone number and address for Bruce Edwards were not available, and Benjamin Edwards declined to provide a way to contact his brother.

Coleman said he does not know the identity of the "B. Edwards" who signed his company's invoices.

How MCCI came to be hired -- given that it didn't exist on paper at the time it got the contract -- remains unclear. The firm has no office or telephone number listed in local directories.

Hughes said he signed up to work for the company by visiting the S&WB's offices near Carrollton and South Claiborne avenues, where willing workers could fill out job applications.

Other links to firms

While the grand jury's second subpoena appears aimed at ferreting out links among Edwards, Coleman and MCCI's work, there is also a reference to JLJ Construction, a company that does not appear on any of the S&WB contracting documents reviewed by The Times-Picayune.

It's not clear what role prosecutors think the company might have played, if any, in the MCCI work. But the firm and its owners, James L. and Daisey Mae Jones, are listed in the first subpoena, issued in March. That subpoena also mentions Edwards and MCCI.

The March subpoena contains notable echoes of a story published in Gambit Weekly in 2001, which detailed several instances in which Benjamin Edwards intervened in contracting matters on behalf of certain firms. One of the companies for which Edwards lobbied on multiple occasions, according to Gambit, was Exceptional Temporaries, which provided workers and tools to the board for specific jobs and is listed in the subpoena. Edwards did not comment for the Gambit story but has in the past denied doing anything inappropriate.

Edwards also stuck his neck out for JLJ Construction, which received more than a dozen water board subcontracts, Gambit reported -- including one to clean up lots owned by Edwards' nonprofit.

The Joneses could not be reached for comment.

The March subpoena also requests documents from three other firms: Fleming Construction, Prosperity Consultants Management and Prosperity Management Co., none of which were cited in the Gambit piece.

Jack Fleming, vice president of Fleming Construction, said his firm had not received any subpoena and he has "no clue" what prosecutors might be investigating. He said his company had done work in the past for the S&WB, but not since Katrina.

Randall Moore of Exceptional Temporaries said his firm had not received a subpoena. He said the firm had worked as a subcontractor for Fleming Construction several years ago.

Efforts to reach the director of Prosperity Consultants Management, based in Monroe and organized in January, were unsuccessful.

It's not the first time investigators have examined Moore. He pleaded guilty to a single federal felony charge last year for his role in a kickback scheme involving a massive energy contract at City Hall. He agreed to cooperate with prosecutors in that case, in which several defendants are set to go to trial in September.

Benjamin Edwards was originally appointed to the S&WB by former Mayor Sidney Barthelemy and was retained by former Mayor Marc Morial. Nagin has not reappointed Edwards, but has allowed him to continue serving although his term expired in late 2003.

Edwards has long been a staunch advocate for minority-owned businesses getting a fair slice of the S&WB's work. He said he suspects his outspokenness is what sparked the current federal probe.

"Every mayoral administration, someone decides to do an investigation of Ben Edwards, whether it's Gambit, The Times-Picayune or the U.S. attorney," he said. "I'm a person that stands on morals. I believe it's incumbent to do business with disadvantaged companies that are local and pay local taxes, that's what it is.

"I'm not going to change from my position. And it's clear that's what it's about. It's pure politics."

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