US expands inquiry into DiMasi friends
State building contract at issue
Federal investigators have broadened their inquiry into the business dealings of friends of former House speaker Salvatore F. DiMasi, reviewing a $1.4 million state contract awarded to a company co-owned by Richard Vitale to manage a signature state building in downtown Boston, according to two officials.
Authorities have subpoenaed phone logs from DiMasi's former State House office, and, according to one of the officials, they are looking to see whether DiMasi or his subordinates exerted any political influence on the state contract award.
The three-year contract to manage the state Transportation Building was awarded in 2006 to Genesis Management Group LLC, which was formed by three partners, including Vitale, who was DiMasi's close friend and accountant at the time.
Just months after Vitale and his partners incorporated Genesis, it knocked out a company that had held the management contract since 1992. Genesis submitted the low bid, but according to the bidding rules, the state had discretion and was not required to award the contract based on price alone.
DiMasi's lawyer, Thomas Kiley, said he had no knowledge of the contract or the investigation and would not comment.
Vitale's lawyer, Martin Weinberg, said there was nothing irregular in the Transportation Building contract, which was granted by the state Division of Capital Asset Management.
"There was absolutely no legal or ethical wrongdoing in the selection of Genesis to manage the Transportation Building," said Weinberg. "Genesis and Paul Grant [one of Vitale's partners] have wide experience and enormous competence in managing business properties."
Division officials said neither the speaker nor anyone on his staff lobbied the division on the company's behalf. Agency spokesman Kevin Flanigan said Genesis has done a good job managing the building.
Grant and the third Genesis partner, Thomas Neve, did not respond to requests for comment.
Genesis receives a management fee of $70,000 a year and nearly $400,000 to cover salaries of Genesis on-site property management staff. Besides the salaries and fees, the company has the authority to put out bids and award maintenance, operations, and repair work using an annual budget of more than $7 million.
Genesis landed the contract at around the same time that Vitale was helping special interests win favorable treatment on Beacon Hill.
Vitale has been indicted by the state on charges that he secretly used his friendship with DiMasi to help the Massachusetts Association of Ticket Brokers win House passage of a bill that would remove the state's cap on ticket prices.
Vitale also received $600,000 from a sales agent for the Burlington software company
Also under scrutiny are payments involving Cognos lobbyist Richard McDonough and the firm's sales agent, Joseph Lally, both of whom also had close ties to DiMasi.
Investigators are also reviewing a 2007 bid by Genesis to operate the Moakley federal courthouse in Boston, where Grant had previously worked, the official said. That bid was not successful.
The division put out the request for proposals to manage the eight-story Transportation Building in March 2006. The building, encompassing 900,000 square feet at the corner of Charles and Stuart streets, houses the Executive Office of Transportation, the Massachusetts Turnpike Authority, the Massachusetts Bay Transportation Authority, the Massachusetts Highway Department, a retail and restaurant complex known as CityPlace and a two-level parking garage.
Although he has been involved in some large-scale development projects, Vitale has little experience managing real estate.
Grant is a former executive with Urban Retail, which ran several government buildings, including the Moakley courthouse, the Ronald Reagan building in Washington, D.C., and 1010 Massachusetts Avenue, a City of Boston office building. He also was executive vice president and general manager of Copley Place.
Neve described himself in the Transportation Building proposal as "engineer, surveyor, and master developer." In state campaign and finance records, he gives his occupation as "realtor," with an office in Topsfield.
The proposal described Vitale's property management role as "a new venture." With his vast accounting experience, the proposal says, Vitale can "successfully service the client's specific needs for financial accounting, reporting, and tax consulting."
Genesis's bid, one of four, was $138,973 less than the second-lowest bid. In its request for proposals, the division said it would evaluate the bidders "to determine best value for the Commonwealth." Cost was one of eight criteria considered. Others are demonstrated experience, the clarity of the proposal, and the extent to which minorities and women are part of the company.
Among the other bidders were two firms that had specialized in real estate management for more than a century - RM Bradley, which had managed the building since 1992, and Codman Co. Inc. Officials of the losing companies declined to comment on the contract award.
Since 2007, Genesis has also been managing a city building in West Roxbury. Under the $1.49 million contract, it operates a building on Rivermoor Street that houses the city archives and
City officials said they did not know that Vitale was involved and awarded the contract to the company after deciding the only other bidder did not meet its qualifications.
Genesis also manages 495 Business Center, a private office park in Tewksbury.
To help it win the Transportation Building work, Genesis cited Vitale's experience developing real estate - including Manchester Downtown Visions LLC, a mixed-use development including residences, a semipro baseball stadium, retail space, and a hotel along the Merrimack River in Manchester, N.H.
The proposal also cited the work of Vitale's former accounting firm, Vitale Caturano, in managing its corporate headquarters, a 90,000-square-foot office building on Constitution Wharf in Charlestown.
The Transportation Building contract expires in June. It contains an option for three one-year extensions, but Flanigan said the agency has decided not to extend the contract. It plans to issue a new request for proposals that "we hope will allow us to lock in favorable pricing for several years."
Flanigan would not comment on the federal probe.
