State Government
Falcon paid janitors less to secure contracts
10:01 AM EDT on Friday, October 17, 2008
Falcon Maintenance Company was aggressive — and often successful — in its pursuit of state janitorial contracts.
And according to information submitted to the state by Falcon’s owner, Vincent D’Elia, the company paid lower hourly wages to its janitors than almost all of the other companies that sought the contracts — sometimes less than half what other companies paid their workers.
Falcon was one of two contractors that employed 31 janitorial workers who were arrested in July during raids at the state courthouses. The U.S. Attorney’s office yesterday announced that D’Elia faces a criminal misdemeanor charge of knowingly hiring undocumented workers.
Over the past week, five reporters from The Providence Journal have been reviewing all of the state contracts for janitorial work that were awarded by competitive bid in recent years.
In bids for the 24 state contracts held by his company, D’Elia led the state to believe he was paying payroll taxes and workers’ compensation insurance for his employees. In papers contained in the bid files, D’Elia documented little profit on the state contracts that he won. For example, on one three-year contract that Falcon won in 2006 to clean the Benjamin Rush Building D’Elia wrote that he would make a 3-percent profit –– a little more than $1,000 a year.
When the state waited several weeks to award that contract after the bidding deadline, Falcon contacted state officials to ask what the status was, warning that it would have to lay off an employee if Falcon didn’t get the work.
(That contract was among the many that were revoked from Falcon in July after undocumented workers were arrested as they performed janitorial work at state courthouses.)
In winning a three-year contract to clean the Rhode Island National Guard’s “Property & Fiscal Office” at 330 Camp St. in Providence at a cost of roughly $5,500 a year from October 2005 through 2008, D’Elia promised to provide one janitor on Tuesdays and Thursdays for up to five hours per week.
He told the state he would pay the worker a minimum wage, $6.75 an hour. He also signed a “certification and disclosure” statement in which he promised that he would “maintain required insurance during the entire course of the contract.” On this particular contract, he told the state he stood to make a $1,200 annual profit after paying $1,755 in wages to the janitor, plus $458.94 in unemployment and other payroll taxes and insurance, and $140.40 for supplies.
This military contract was one of Falcon’s bigger money-makers, according to the cost worksheets the state requires of bidders.
On a $15,500 contract awarded to clean a Department of Labor & Training office in West Warwick, Falcon projected only a $244 annual profit after paying wages, taxes and insurance.
On another three-year contract it was awarded in April — since rescinded –– to clean the Division of Motor Vehicle’s Operator Control offices, for $14,973.24, D’Elia wrote that he would make $97.24 profit per year. The contract required him to provide one janitorial worker for 10 hours a week who would be paid $7.40 per hour. (Under an emergency contract issued to Excel Maintenance in August, after the state terminated Falcon’s contract, the state is paying almost $200 more a month for cleaning the Operator Control offices.)
One of the biggest contracts D’Elia held with the state was for cleaning the main Department of Administration building at One Capitol Hill. In papers submitted to get that contract, D’Elia said he would pay seven part-time janitors $7.40 an hour. On the worksheet he provided the state, he anticipated a $5,629 annual profit after paying $40,404 in salaries, plus $10,565 in taxes and insurance.
Most, if not all, of its state contracts required Falcon to provide the branches of state government for which it worked — including the National Guard — “the name, Social Security number and date of birth for all employees involved in the work.” The National Guard has refused to provide the names of the individuals assigned by Falcon to work in its buildings.
Most recently, Rhode Island National Guard spokesman Lt. Col. Denis Riel advised The Providence Journal to file an information request with the federal government for the names of the people working in its buildings under state cleaning contracts. Other than acknowledging receiving the request, the National Guard has provided no response. Some other state agencies have responded to requests for the employees’ names.
––With reports from staff writer Amanda Milkovits
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