3 companies suspended from Detroit demo work over conflict of interest concerns
Detroit — The City of Detroit has suspended three companies from performing work related to demolition site abatement because of possible conflicts of interest, city officials said Tuesday.
In a letter sent to demolition contractors on Tuesday, the city said it recently became aware that the relationships among three local abatement-related companies might be in violation of the city’s Abatement and Demolition of Residential Properties Agreement and other contracts related to abatement and demolition services.
“If anything pops to our attention along the contractual chain, we’re going to dig into that and we have the right to do that,” said Tim Devine, general counsel for the Detroit Land Bank Authority.
At issue is the relationship among abatement subcontractor BBEK Environmental and air quality testing subcontractors Green Way Environmental LLC and HC Consulting, all based in Warren. Records show the owner of Green Way Environmental LLC is an employee of BBEK Environmental.
The city has referred the issue to the city’s Office of Inspector General for investigation.
Meanwhile, Kevin Woods, the owner of BBEK Environmental, and William Scully, the owner of Green Way Environmental Services, contend that each has no ownership ties to the other businesses.
Before demolishing a building, demolition contractors bring in asbestos abatement companies to perform work. After that, another company comes in to perform an air quality test.
“The contracts we have in place and the contracts that the general contractors have in place down the contractual chain require that the party doing the abatement is independent of the party doing the post-abatement air quality testing,” Devine said. “That’s one of the checks that we do after the abatement is completed before we get on with the knocking down of the structure.”
Scully said that he works for BBEK Environmental as its part-time controller and has no ownership interest in either company. He said he began operating Green Way Environmental in early 2018.
“I think if they follow the rule of the law, it will be rescinded,” Scully said of the suspension. “It’s not fair to (Kevin Woods) to punish him because I’m in business … Where did all of this come about?”
Attorney Rebecca Camargo, who represents both Woods and Scully, said the companies are not in violation. She said that BBEK does not always use Green Way for air quality control.
“When they do use Green Way, they are using a company that is truly a neutral party, fully separate from BBEK,” she said.
Camargo said she is in contact with the city and expects BBEK to be cleared.
“In the meantime, my client is being unfairly targeted and risks losing out on several million dollars of contract work,” she said.
The city has required its demolition contractors to report by the end of the business day Wednesday of any work the companies are currently performing throughout the city.
Devine said he did not yet have a count of how many projects the companies are currently involved in within the demolition program.
Devine said the matter does not pose a threat to public health and safety because a city-hired contractor performs a separate analysis after the abatement work and air quality testing is complete.
The city informed contractors Tuesday that if any of the companies under scrutiny are currently performing work, then the contractor may allow BBEK Environmental, Greenway Environmental and HC Consulting to complete abatement of the site “so long as the post-abatement air monitoring is conducted by an independent third-party.”