Houston Mayor John Whitmire is calling for better screening of businesses working with the city, citing an issue with contractors going bankrupt before their projects are complete.
In 2020, the city awarded more than $4.9 million to Vortex Turnkey Solutions to repair damaged sewage pipes. The contractor went bankrupt 75% of the way through the project.
City documents state they did not have the manpower or supplies to complete the project, attributing to price increases and a labor shortage brought on by the COVID-19 pandemic.
On Wednesday, the Houston City Council approved paying the contractor a different amount than initially authorized: only paying them for 75% of the work completed, which came out to a little less than $3.5 million.
Because construction was halted, the city then had to push through emergency purchase orders on Wednesday to have subcontractors carryout safety measures like traffic control until they can replace the primary contractor.
Those emergency orders cost more than $1 million. They were pushed through unanimously by the council. The city plans to recover the cost through performance bonds that were in place for the initial contractor.