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PennDOT upholds GOH contract suspension

Filing of criminal charges is sufficient grounds under Pennsylvania Department of Transportation regulations to suspend a contractor, the agency says.

That was the response received Wednesday when asked why Glenn O. Hawbaker Inc. was temporarily suspended from bidding or participating in contracts prior to the resolution of criminal charges against it.

“PennDOT will not comment on the pending criminal prosecution and does not make determinations as to criminal guilt or innocence,” spokesperson Alexis Campbell added.

PennDOT’s April 19 notification to Hawbaker applies to state supervised or funded highway construction work, she said. It does not affect contracts in effect before that date, she said.

In general the suspension also would apply to local projects that have PennDOT oversight or funding, she explained.

“If it is a local job with no PennDOT or federal money or oversight, then the suspension would not apply,” she said.

“However, other entities, such as municipalities, may have local processes to determine whether a bidder is qualified.”

PennDOT suspended Hawbaker after the state attorney general’s office on April 8 charged it with four counts of theft tied to state and federal prevailing wage laws.

It is accused of stealing more than $20 million from employees by not abiding by federal and state regulations that set compensation rates for employees working on government construction projects.

Hawbaker, one of the state’s biggest road and bridge construction firms, is charged with underfunding employee retirement plans by $15 million in the last five years, the limit the criminal charges can cover because of the statute of limitations.

Money that should have gone into the retirement accounts of line workers was siphoned into the accounts of executives, Attorney General Josh Shapiro said in announcing the charges.

The State College firm also used phony billing, claiming inflated costs for health care expenses so it could appear to be meeting the prevailing wage requirements while actually pocketing the difference between what it claimed and what it actually paid, Shapiro said.

In a statement issued after being charged, Hawbaker said it cooperated with the AG’s investigation and pledged “to work constructively” to reach a swift resolution.

“While we believe that we have always acted in accordance with all state and federal laws,” in an abundance of caution the company said it immediately changed its prevailing wage practices.

The charges are in Centre County court after Hawbaker waived its right to a preliminary hearing.

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