February 28, 2022
Comptroller Peter V.R. Franchot (D) announced a new online portal for tracking state payments to vendors Monday. But a state senator slammed the comptroller for not acting sooner to make vendor payment information publicly available.
Franchot rolled out the new system, Maryland Vendor Information Electronic Warehouse (MD-VIEW), at a Monday morning press conference. The online database will allow users to see when the state makes payments to vendors and contractors.
Franchot said the database is specifically meant to help subcontractors, or businesses that work under vendors and contractors who receive payments directly from the state. He hopes the online portal will end the practice of prime contractors delaying payments to subcontractors by saying they haven’t been paid by the state yet.
“This is a solution to a problem that’s been going on for years,” Franchot said.
Ike Casey, the executive director of the American Subcontractors Association of Metro Washington, said the majority of contractors pay their subcontractors quickly upon receiving payment from the state, but added that the bill would ensure accountability for those that don’t.
“There are general contractors and some prime contractors that pay their subcontractors as quickly as they should, and that’s why this portal is so important,” Casey said.
Del. Darryl Barnes (D-Prince George’s), the chair of the Legislative Black Caucus of Maryland, praised the portal for having “no barriers to access” since the system is free and user credentials and passwords aren’t required.
Barnes is sponsoring legislation to shorten the amount of time the state has to pay for procurement contracts after receiving the proper invoice to 15 days rather than 30 days, and shortening the amount of time before the state owes interest to 15 days from 45 days. Sen. Antonio L. Hayes (D-Baltimore City) is the sponsor of the companion Senate legislation.
“This is what our small business small minority-owned businesses, women-owned businesses and veteran-owned businesses come to look for and expect,” Barnes said.
Calvin Mims, the president and owner of Calmi Electrical Company in Baltimore, said the portal would encourage companies to pay subcontractors in a more timely manner.
“Most small and minority-owned businesses are undercapitalized and one or two payments away from not being in business,” Mims said, adding that he hopes the comptroller’s office would also reach out to small businesses to educate them on using the portal.
Franchot’s announcement comes after a pair of state lawmakers introduced broader legislation to set up a statewide portal for payments to vendors and contractors: Senate Bill 281, sponsored by Sen. Cheryl C. Kagan (D-Montgomery) and cross-filed as House Bill 308 by Del. Brooke E. Lierman (D-Baltimore City) would require the comptroller to set up an online payment processing portal.
The online payment processing portal outlined in the bill would allow any “entity,” including nonprofit corporations or local governments, that is owed money for goods or services provided to the state, to track payments from the state. The portal in that proposed legislation would include notifications for when payment requests are received, approved and paid, and provide contact information for the person responsible for reviewing and approving the payment as well as allow payees to track documents submitted to the state.
That legislation also stipulates that “the unit of state government responsible for making a payment to a payee shall update the changes in payment status tracked through the online payment portal.”
The comptroller’s office argued in a Feb. 22 letter to Kagan and Lierman that their proposed portal is more broad compared to the the payment-oriented portal rolled out by Franchot Monday and “cannot be stood up with existing…resources as it would require — among many other things — significant technological investments to create a portal that essentially can be accessible and updated by all paying agencies” and the comptroller’s General Accounting Division.
Lierman, a candidate for comptroller who has emphasized transparency on the campaign trail, said Monday she felt the legislation was no longer necessary given Franchot’s announced new portal.
“I think most likely we will now not need to pursue state legislation,” Lierman said. “This was always something that could be done administratively, and I’m thrilled to see that it is. I think there’s always room for adjustments as the system rolls out.”
Kagan, however, said it was “politically convenient” for Franchot, who is running for governor this year, to roll out the portal now. Kagan is supporting Wes Moore, one of Franchot’s opponents in the June Democratic gubernatorial primary.
“He’s been in office for 15 years and for 15 years our procurement process has been a failure,” Kagan said of Franchot. “We have needed more transparency and better accountability. So here it is, a few months before his election, and he’s suddenly rolling out a whole new website.”
Kagan, the chair of Maryland’s Next Generation 911 Commission, said she was having conversations with the comptroller’s staff about a procurement portal last year after the director of a 911 center called her because a vendor had been waiting months for a payment. She also criticized Franchot for launching his portal without consulting other state procurement agencies.
In a statement, a Franchot spokesman acknowledged the conversations but said the comptroller wanted to prioritize setting up a portal to track contractor payments.
“As stakeholders noted during the press conference, the Comptroller’s Office has held ongoing discussions about the need for this portal with subcontractors for several months, preceding the Senator’s introduction of her legislation, which — as we have repeatedly pointed out — seeks to create a significantly different portal than the one announced today,” Alan Brody, the comptroller’s press secretary, said in the statement.
Kagan said late Monday that she would withdraw her legislation.
“Rather than creating yet another site for the State to pay for and manage, I am writing to withdraw SB281,” she wrote in a memo to Senate Education, Health and Environmental Affairs Chair Paul G. Pinsky (D-Prince George’s). “I am hopeful that next year, in collaboration with Del. Lierman (as our new Comptroller?), we will have an effective, transparent system available for Maryland vendors.”