Article from WMAR has some additional info.

From the article: "We acknowledge that we have not always, Metra has not always paid within the seven-day requirement," said Venroy July. "But we need some context here. We all know Baltimore City does not always pay its contractors on time."

Ahhh the good ol' whataboutism in play

The have quite an interesting company name...

> Minority and Women's Business Opportunity Office found Metra repeatedly failed to pay subcontractors on time. The office's chief, Christopher Lundy, said in one case, payment came more than a year after the work was finished, and only happened after the city got involved.

Oh cool, now do Hopkins

Are you thinking of the Chicagoland commuter rail system...?

There might be some validity to this point, as the city's been known to have issues paying its contractors on time.

>"Metra acknowledges that subcontractors are entitled to timely payment on work that has been completed, and while it does not excuse its own late payments, prime contractors are similarly entitled to timely pay for work completed for the City," July wrote. "The City’s continuous failure to make timely payments impacted Metra’s cash flow and availability of capital, and its ability to make timely payment, particular during and on the heels of the Covid pandemic."

If that were the direct cause, then the lawyer should have identified that as the direct reason. According to the article, the only "justifications" Metra gave were "Covid, accounting errors, and misunderstanding costs."

So what? The City should continue letting Metra paying contractors late? Also, Metra shouldn’t be involved in this contract if their cash flow is so heavily dependent on just one customer, the City.

I don't know anything about how this specific contract was phased, but typically you rely on contract funds to pay your job costs (materials, subs, etc). You can use a bank line to bridge a delayed payment from the owner, but it isn't reasonable to maintain enough liquidity to self-fund your backlog.

For smaller companies, sure. But Metra has a $150m contract with the City. They should have enough cash reserves to pay small business owners.

If a company has >25% of its receivables or revenues from one customer, then that’s not ideal. If that was the case here with Metra, then the City should look for another contractor that isn’t so dependent on the City’s contract.

Twotenny!!!

If I do X thing which is wrong it doesn’t make you doing X right.

Hopkins have a reputation for not paying out?

They changed up their claims department (outsourced it maybe? not entirely sure) along with the entire customer service department on September 1st last year and many providers have been unable to get paid for services rendered, negotiate rates, or even use their billing system since then.

Their phone system even has an automated message set up for it... "If you're calling in reference to claims prior to September 1, press 0. For dates after September 1st, press 1".

Seems the city needs to pay a company to pay their bills on time. Where have we heard this before?

Like the companies which manage 401K accounts or insurance claims, every day they get to hold on and invest that money is more profit for them.

I know city contractors owed over a million dollars all in relatively small repair bills. The bills are over 12 months overdue.

>So what? The City should continue letting Metra paying contractors late?

Well that does not bode well

Within the local underground utilities contractors, Metra is known for not paying anyone and screwing over the small subcontractors. They had this coming for years.

The $150M in the article is not accurate and is probably their "pre-qualification" amount with the City. They probably have closer to $50M in contracts spread across a number of jobs.

The biggest reason they've been disbarred is because they lied to the City repeatedly while the City was investing the MBE/WBE claims. The 7-day payment clause was just the most convenient way for the City to disbar them.

They should also have been required to carry a payment bond to ensure that subs get paid regardless of financial circumstances affecting the prime.

Correct. If you read the documents on the City’s BOE page, it says Metra has a total of $152m in contracts with the City over the past 6 to 8 years. I think the writer of this article made a mistake. The contract they were discussing at the meeting was only like $4m.

[deleted]

that's what the office's chief said. But what are the real facts? Could be city got involved by actually Paying what they owed, then the subs got paid. This is what happened.

As someone who deals with federal government contracts, I regularly see pay-when-paid provisions within. That means our time to pay a subcontractor or vendor starts once we receive payment from the prime contractor or government. Big projects whose timeline spreads across months are billed monthly based on progress, the government agrees with the schedule of values and progress on each line item, and then issues payment. The subcontractors' work would be included in that billing, so there would be enough money to cover everybody's expenses for the last month. A contractor generally doesn't bankroll the whole thing out of pocket when payments are delayed from the government.

That's federal. Municipal would have different laws and the city itself might have specific provisions in their contracts. But if the 7-day deadline starts when Metra receives payment from the City, and Metra is being kicked out for not meeting their sub payment deadlines, then that means that the city paying them late has nothing to do with their own late payments to subs.

Good point. Well-explained...snarklessly, at that. 👌🏾