December 7, 2022

Texas firm that built NYC’s doomed migrant tent camp overcharged city more than $130K: audit

The Texas construction company hired to build Mayor Adams’ since-shuttered migrant tent camp overcharged the city more than $130,000 as part of a separate contract related to COVID-19 vaccination sites, according to a new audit from Comptroller Brad Lander’s office.

The $136,468 in overpayments happened because the company, Galveston-based SLSCO, on several occasions double billed the Department of Emergency Management and used inflated rates for operating city-run vaccination sites, Lander’s team found as part of the audit.

The brunt of the overpayments — $129,000 — were issued by the city because SLSCO charged the city for administering 150 COVID shots per day at its pop-up sites in June and July 2021 even though the capacity was 100 doses, according to Lander.

In addition to the overpayments, the contractor received $23,861 in payment from the city without providing proper documentation for the expenses, Lander found.

The sleeper unit at the Randall's Island Humanitarian Response and Emergency Relief Center is pictured Oct. 18, 2022 in New York.

Spokespeople for Adams and the Department of Emergency Management did not immediately return requests for comment Wednesday, and neither did a spokeswoman for SLSCO.

But Lander wrote that the Emergency Management Department informed his office this past September that it would ask SLSCO to reimburse the full amount of overpayments uncovered by the audit.

As to the other issue, the department agreed to request missing documentation from SLSCO for about $10,000 of the undocumented spending, according to Lander.

The remaining chunk of uncorroborated costs related to a “flat rate set-up fee” that the department told Lander it did not need documentation for. Lander begged to differ.

“NYCEM’s disagreement notwithstanding, the auditors recommend that NYCEM enforce the terms of the License to Use Agreement and ensure that the amount is included in the Licensor’s first invoice, with supporting documentation,” his report stated, using an acronym for the department’s name.

The revelations about SLSCO’s overcharging comes as questions remain about how much Adams’ administration has paid the company for building and breaking down its controversial migrant tent camp on Randalls Island.

The tent facility, which had capacity for 1,000 people, was ordered closed by Adams last week after having stood mostly empty since opening in mid-October due a drop in Latin American asylum seekers arriving in the city as part of a wave of migrants coming up from the southern border that started this spring.

Emergency Management Commissioner Zach Iscol told reporters during a tour of the facility last month that his agency had shelled out $325,000 to SLSCO just for building the Randalls camp. Iscol said the department paid SLSCO another $325,000 for first building the camp in the parking lot of the Bronx’s Orchard Beach before having to dismantle it and move it to Randalls due to flooding concerns.

Lander and the City Council have for weeks pressed Adams to provide receipts for the total price tag for the migrant tent operation. But so far, Adams’ team has balked at those requests.

A Lander spokeswoman said Wednesday that her office still had not received any contract the administration has issued to SLSCO for the tent camp job.

The Council is expected to hold two days of hearings next week on the administration’s migrant crisis response, with testimony expected from officials from the Emergency Management Department and other agencies. Council Speaker Adrienne Adams (D-Queens) is expected to chair the hearings, according to a source.

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