A $164,000 Deal?
By Eileen Welsome
ALBUQUERQUE—Buried in the files of City Hall is a weird agreement involving architect Marc Schiff, a central figure in the Metro Court kickback scandal.
The agreement, which is undated, describes a transaction in which the city of Albuquerque erroneously paid Schiff and his firm, Design Collaborative Southwest, roughly $164,000 for construction costs associated with exhibits at the Balloon Museum. The architectural firm then passed the $164,000 to Gerald Martin General Contractor, the firm that actually did the work. (The $164, 000 payment actually consists of two checks for $71,521.70 and $92,432.12 written by Marc Schiff during the first two weeks of December 2005, city records show.)
No one could explain how the error occurred or how it was discovered. But in May of 2006, a new supplemental agreement was hammered out in which the city acknowledged the mistake. Although one city staffer suggested that DCSW return the money to the city and that the city then issue a new check to the Gerald Martin construction company, that suggestion wasn't followed. Instead, city officials -- after the fact -- drew up the agreement to reflect what had happened and that the funds ultimately went to the right company. The arrangement, as one construction official put it, "eliminated the need to trade checks."
The agreement is signed by the city's chief administrative officer, Bruce Perlman, Gerald Martin, the head of the Gerald Martin construction firm, and Rich Braun, president of Studio Southwest Architects, the successor to DCSW. (Marc Schiff's name is typed on one of the signing pages, but it's crossed out and signed by Braun.)
"We got paid from the city. And we paid Gerald Martin. The city realized they had not processed that properly and wrote that agreement to correct that," said Rich Braun, president of Studio Southwest Architects, the successor to Design Collaborative Southwest.
Some former and current city officials who have reviewed the agreement questioned whether it violates city purchasing regulations. When asked if purchasing regulations were indeed violated, Greg Smith, an assistant city attorney, said it was an "interesting question." He added that there was nothing "nefarious" about the contract and that it was simply an effort to set matters straight.
Mayor Martin Chávez, a longtime supporter of Marc Schiff, did not respond to requests for an interview. His CAO, Bruce Perlman, also did not respond. In a formal response to a public records request, the Mayor's Office said it had no e-mails or documents related to the agreement. A similar request to the city's Legal Department yielded only a couple of e-mails.
The agreement was developed in the spring of 2006, during a period in which the FBI investigation into the Metro Court matter was ongoing but a year before indictments came down alleging that public officials and state employees had pocketed $4.2 million during the construction of the $82 million Metro Court complex. Marc Schiff, in a plea agreement, has admitted creating inflated invoices on his home computer, then kicking back funds to such prominent individuals as former state Sen. Manny Aragon, a Democrat from the South Valley.
Rich Braun said the architectural firm learned of the investigation in February of 2006 when they were contacted by FBI agents. The firm knew nothing about Schiff's involvement in the kickback scheme and gave the federal agents whatever they asked for, Braun said. They were also told not to talk about the case until the indictments were made public. "Our firm has been through a lot of trying times because of what one individual did inside the firm. The firm has never been under investigation," he added.
Greg Smith, the assistant city attorney, said he knew nothing about the FBI probe until it was made public on March 29, 2007. "I don't know if anyone in the city knew anything about it."
