BALTIMORE (WJZ) — Baltimore City has filed a suit against Transdev North America Inc., and Transdev Services, Inc. for a breach of contract Wednesday morning.
The lawsuit says that Transdev overcharged the City more than $20 million for the operation of the Charm City Circulator, the free shuttle service available to City residents, downtown employees, students, tourists and anyone who wants to ride, according to a release from the City.
“This lawsuit reflects the Mayor’s priority to increase transparency and accountability in government dealings,” The release stated.
The City alleges that instead of invoicing the City for hours it actually operated the Circulator, as the agreement for the operation of the Circulator required, Transdev invoiced the City for thousands of hours more for passenger transport.
“Transdev’s overbilling practice resulted in the City overpaying Transdev over $16 million since 2010,” The City stated in the release.
The City said it is seeking compensation for the overpayment.
City Solicitor Andre M. Davis created a subdivision of the Law Department that he said is devoted to affirmative litigation for this type of suit.
“When companies violate their contracts with the City and either overbill or underpay, the Law Department will seek damages to make taxpayers whole,” said Solicitor Davis. “Mayor Pugh has been clear that we have many pressing funding needs for essential programs for our youth, to provide job training and job creation, to remedy vacant properties, and to upgrade basic services for City residents. This lawsuit is wholly consistent with our duty to serve as responsible stewards of tax payer funds and hold accountable companies doing business with the City who fail to live up to their contractual obligations.” – Davis
Transdev is expected to be served with the lawsuit this week.
Transdev released a statement responding to the allegations of overcharging:
“We are extremely disappointed that the City of Baltimore elected to pursue this meritless litigation. This issue began when Transdev won the bid to operate the Charm City Circulator in 2010. The City was required to provide the full fleet of buses but was unable to do so because it selected non-functioning vehicles with unproven technology from a company that ultimately went bankrupt.
Because the City was unable to meet the terms of the contract, Transdev agreed to the City’s request for a new contractual and invoicing structure. For months, Transdev has actively engaged city officials to address their concerns and provide them with the relevant facts and documents, which makes this baseless lawsuit a complete and utterly non-productive surprise.”
The Baltimore City Department of Transportation is working to select a vendor to provide the Charm City Circulator bus service. The new contract will be for three years. Negotiations between the city’s Bureau of Procurement and the new vendor will begin immediately.
The release said it is anticipated the new contract will be awarded by October 10.
The City assured that citizens will not see changes in existing service locations, schedules or hours of operation, as they said they will be utilizing local companies to provide the bus bridge service until a permanent new vendor can begin.
They did note that some of the buses operating after October 11 may be different in size or design from the original Charm City Circulator fleet.