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Campaign contributor wins big award for replacing Baltimore’s water meters

A small Pennsylvania company with deep political pockets gets a $25 million contract.

Above: Headquarters of L/B Water Service in Selinsgrove, Pa.

Baltimore has selected a small Pennsylvania company – and large contributor to Mayor Stephanie Rawlings-Blake’s election campaign – to supply water meters to city residents.

L/B Water Service, of Selinsgrove, Pa., was awarded $25 million today by the Board of Estimates to provide new meters after city officials found a low bid of $20.5 million by another company to be “non-responsive” to the city’s technical requirements.

The award was based partly on price and partly on the product advantages it offered the city, according to water bureau officials.

Mayor Stephanie Rawlings-Blake voted to approve the contract with L/B Water, which contributed $6,000 to her election campaign last year, according to Maryland Election Board records.

CEO Fred Steimling said the contract represents the largest in L/B’s history. “We’ve done other large meter contracts, but nothing of this size,” he said today in a brief interview.

A longtime supplier of meter parts to the city, L/B Water put together its successful bid with the help of two vendors who were also generous contributors to the mayor last year – Grant Capital Management and R.E. Harrington Plumbing & Heating Co.

In its bid letter to the city, L/B Water said it had “teamed up with Grant Capital Management Inc. to provide financing for meter procurement should Baltimore so desire” and had recently leased warehouse space from Harrington so that “product inventory and transportation support will occur locally through Harrington.”

The  company took these initiatives, Steimling wrote, to provide “meaningful MBE participation.” As a commodity contract, the award did not require inclusion of minority or women-owned businesses.

L/B Water's bid letter explained its interest in partnering with Grant Capital and R. E. Harrington to promote minority participation. (From bid document, City Comptroller's Office)

L/B Water's bid letter explained its interest in partnering with Grant Capital and R. E. Harrington. (From bid document, City Comptroller's Office)

Before last fall’s election, The Brew identified the Grant firm as one of the top contributors to Rawlings-Blake’s campaign.

The company specializes in the esoteric world of municipal lease financing and has provided $140 million in financing to Baltimore City through several master lease contracts.

Grant contributed $24,000 to the mayor’s reelection on the same day that L/B Water made its donation (Jan. 10, 2011) through the names of its founder, James P. Grant; his wife Judy Grant; his sister Linda Grant; and other relatives and associates.

R.E. Harrington, a leading city sewer contractor, added $4,000 to the mayor’s election coffers on the following day, according to state records.

Contributions Don’t Influence

Rawlings-Blake voted in favor of the L/B  award today at the Board of Estimates. Typically, an elected official on the panel abstains from voting on an item involving a campaign contributor or other potential conflict of interest.

The mayor’s spokesman, Ryan O’Doherty, said he could not comment on the specifics of campaign contributions as a government employee.

However, he added, “campaign donations have not and will not have any effect on the Rawlings-Blake administration’s actions, period. The mayor’s record on ethics, transparency and good government is sound, honest and undisputed.”

Until the mayor’s campaign last year, L/B Water had never before made a political contribution in Maryland, according to state records.

After a brief conversation today, CEO Steimling did not return a promised phone call to discuss the meter contract more thoroughly.

The other companies bidding on the contract did not make any political donations in Maryland last year, a review of the records indicate.

Low Bidder Disqualified

L/B Water became the low bidder after the city disqualified Badger Meter Inc. for proposing to use the ARB meter as opposed to the specified AMI  device.

An ARB (Automatic Reading and Billing) meter allows for remote “drive-by” readings by water inspectors, while the AMI (Advanced Metering Infrastructure) device permits meter readings to be remotely transmitted to a central office.

Rudolph Chow, chief of the bureau of water and wastewater, said his office views AMI devices as  more economical over the long run and will provide the city with superior service.

Today’s award is just beginning of a program by the Department of Public Works to replace 163,000 residential and about 650 compound meters in Baltimore City.

L/B Water will use AMI meters made by Sensus. One of the world’s leading meter manufacturers (along with Badger), Sensus did not bid on today’s contract.

Another leading manufacturer, Neptune, was  awarded a $2.2 million contract today to provide intermediate and turbo/turbine meters, while Mueller Systems was low bidder (at $9 million) to supply fire service meters that use 3- and 7-in. pipes.

Altogether there were five bidders for today’s contracts, with two bidders (Badger and Elster) rejected as non-responsive.

The winning bids were based 60% on price and 40% on technical and service aspects, as scored by a review committee made up of experts, according to city bid records.

The supply contract with L/B Water is expected to last through 2016, while the entire meter replacement program – including new meters in Baltimore County – is liable to continue through 2020.

For information on the company that submitted the low bid for the installation of the new meters in Baltimore, see this Brew exclusive.

With about 100 employees, L/B Water is a private company that was founded in 1970 and chiefly serves rural areas of Pennsylvania with water-works and sewer products and services.

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