ProCAP Fallout: Businesses Owed $400k
Wednesday, December 28, 2011
A small business owner who was contracted by the Providence Community Action Program (ProCAP) to perform 20 weatherization projects –including work on a City Councilman’s home - beginning last spring is saying he may be forced out of business if he isn’t paid soon.
Victor Mendez, whose company Victor General Contractor employs four workers, is owed $58,944.44 for projects completed between April and October. During that time span, the taxpayer-funded nonprofit organization became the target of a federal investigation into how its funds were spent and later learned its state funding was in jeopardy due to concerns over mismanagement within the organization. This month, ProCAP filed for receivership, laid off 20 employees and terminated the contract of former executive director Frank Corbishley.
Mendez is not alone. According to ProCAP spokesman Bill Fischer, “approximately $400,000” is owed to more than a half dozen contactors. As of the receivership filing, Fischer said the organization was about $2 million in debt and had been using funds designated for weatherization projects to cover payroll expenses.
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“We Will Close”
Mendez said he was promised numerous times in recent months that he would be paid so he continued with the weatherization projects on the homes. He said he was forced to borrow money to purchase some of the equipment needed for the work and he is now struggling to pay back the loans.
“I feel terrible. I feel that I can't do anything and I do not know what to do,” Mendez said. “I need the money right away or we will close. I can't do nothing about it. I owe interest and I still have to pay my employees."
Mendez said he has consulted with a lawyer, but the decision to file for receivership has thrown everything into flux. He said he has tried to contact the Mayor’s office and the state, but no one has been able to help him.
“[ProCAP employees] kept saying ‘you’ll be paid next week, you’ll get it soon’ but I never got any money,” Mendez said.
Worked on Councilman’s Home
The cost of the work Mendez’s company performed on the 20 homes ranges from $80 at two properties up to $5,389 for the most expensive project. Among the properties his company helped weatherize was the home of the city’s youngest Councilman, Davian Sanchez.
Records show Mendez’s company charged $3,461 for a variety of projects at the Councilman’s Wesleyan Ave. home on Oct. 13. Sanchez, who earns $18,765 annually as a Council Member, lives with his mother, whose name appears on the invoice. Sanchez said his family has received heating oil in the past and said he only knew of the work Mendez was doing “when they arrived.”
“We applied like any other resident like we have for years,” Sanchez told GoLocalProv. “In case you don't know, we ain't rich. My mom and I do need assistance or else we won't have heat for part of the winter.”
Concerned for the Little Guy
In the meantime, Mendez said he can’t do other work because he doesn’t have the funds to purchase the equipment he needs. Now another Councilman is hoping to step in to see what he can do about making sure any contractors are paid what they are owed.
Last Thursday, Wilbur Jennings, who represents the 8th Ward, sent a letter to court-appointed receiver Thomas Hemmendinger to bring Mendez’s situation to his attention. Jennings says he believes new leadership can turn the organization around, but he hopes all contractors will eventually be paid.
“The only thing that I can say is the fact that I know this gentleman has a very productive business and he told me he has done a tremendous amount of work for ProCAP,” Jennings said. “I think it's more than fair for the receiver to see that these contractors get paid.”
Jennings continued: “I’m very concerned about the little guy, the little contactor, the little business owner that seems to always get the short end of the stick in these situations. These contractors have employees and they they've got to put food on their table so this is a lose-lose situation. If they don't get paid, then they may be out of work.”
“I Need to Be Paid”
Fischer said ProCAP is sympathetic to the situation many small businesses contracted to do work with the organization are going through. But he also noted that exercising the full protection of the court was the best way to ensure that the organization will keep its doors open.
If ProCAP had been forced to close, “then the contractors never would have gotten paid,” Fischer said.
For now, Mendez, whose company’s tagline is “We Make it Right,” is forced to wait for the new leadership to make things right at ProCAP.
“I just need to be paid,” Mendez said. “I want to keep my business.”
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