Published: June 18, 2009 08:09 pm      

Federal grand jury looks into paving bids

FRANKFORT — A federal grand jury is looking into bidding practices on road paving projects in Barren and Metcalfe counties in southern Kentucky to determine if any wrongdoing has occurred in the awarding of contracts.

Officials from both counties were recently subpoenaed to appear before the grand jury in Bowling Green, and did so.

They said they were asked if they had knowledge of any agreements for bidding between the only two companies that do road work in the counties: Glass Paving and Stone of Glasgow, and Scotty's Contracting and Stone of Bowling Green.

Greg Wilson, judge-executive for Metcalfe County, said the owner of Glass told him the two companies "had some kind of deal" whereby Glass would not bid in Metcalfe County, but he had no additional details about the arrangement.

Wilson and his counterpart in Barren County, Davie Greer, said Glass is often the only bidder for paving work in Barren County, and Scotty's is often the only bidder for projects in Metcalfe County.

Owner Larry Glass said he told a state investigator that his company sold a quarry to Scotty's last year, and the terms of the sale included a non-compete clause for providing stone. He said the clause is common and legal whenever a business property is sold.

Charles English, an attorney for Glass, said he is aware of inquiries into the company's bidding practices, and that Glass "has endeavored to cooperate ... and will continue to do so." He said Glass is a "good corporate citizen that conducts its business responsibly and according to its obligations."

Rodney England, the chief financial officer for Scotty's, declined to comment.

It is not known specifically what triggered the federal grand jury inquiry into the awarding of paving contracts by Metcalfe and Barren counties, but there is a history of scandal involving highway construction projects in Kentucky.

Joe Prather, the state's transportation secretary, said he could not comment on the federal grand jury inquiry.

Prather promised to clean up the awarding of contracts in Kentucky after his predecessor, Bill Nighbert, was charged with federal bid-rigging in a case involving contractor Leonard Lawson and one of Lawson's employees. Nighbert is accused of helping to provide Lawson with confidential bidding information so he could win contracts.

Glass said he was invited to an interview with state transportation official David Bragg in Bowling Green, but that Bragg did not indicate he was with the department's office of inspector general. He said Bragg told him he was doing market analysis.

“But when I got there, it was obvious he was after something else," said Glass. "All the questions were why doesn't Scotty's bid on work in Barren County."

Glass said companies often can't submit competitive bids in counties where they don't own a quarry or asphalt facility near the project. "Hauling (distances) on projects determines who bids and who doesn't," he said.

Barren County Magistrate Tommy Matthews said he also testified before the grand jury. He said he had no knowledge of illegal bidding practices on paving work, but that he previously had questioned why the county sometimes receives a sole bid on a project.

Greer, the Barren County judge-executive, said even when Scotty's bids on paving work in her county, the bids are usually higher than those submitted by Glass.

She said recently the county awarded bids for stone on a paving project to both Scotty's and Glass because of the strategic location of their quarries to the construction work. She said the arrangement allows road crews to access the quarry nearest to the construction site at the time, saving time and hauling costs.

RONNIE ELLIS writes for CNHI and is based in Frankfort. Reach him at rellis@cnhi.com.