THE PAPER TRAIL Cardi repeatedly failed to disclose a $35,000 fine for wetlands violations on state bidding forms. But the real problem is that the state’s narrowly-tailored question doesn’t even require companies to report many kinds of environmental transgressions — like Cardi’s $251,546 fine for hauling soil laced with carcinogens to a middle school construction site. The Massachusetts Department of Transportation’s “prequalification” process, by contrast, requires prospective contractors to disclose a wide swath of environmental and workplace safety violations.
>> READ: Road contracts associated with Cardi Corporation construction <<
In April 2005, the federal government accused All States Asphalt of Sunderland, Massachusetts of forging drivers' logs in a bid to get around regulations limiting the number of hours truck drivers can operate vehicles.
All States, a regular contractor for the state of Rhode Island, pled guilty to a single count of making a false statement, and agreed to pay a $168,000 fine, serve two years probation, and implement a new safety regime.
All States, at least, discloses the crime on bidding forms. But a Phoenix examination of dozens of road contracts suggests that's more the exception than the rule. Highway construction firms, required to disclose a rather narrow band of abuses, aren't even doing that.
At least eight times between June 2007 and January 2009, for instance, Cardi executives declared — under pain of "suspension, debarment and/or prosecution for fraud" — that the firm had never been fined more than $5000 by DEM for a violation of Rhode Island wetlands law.
In fact, DEM fined the company $35,000 in March 2007 for wetlands violations in connection with a job on Route 403. Only in June 2009 — after Cardi had repeatedly answered "no" to the wetlands question — did that penalty get reduced to a $4000 fine and $31,000 worth of work on a wetlands restoration project. Cardi did not return calls for comment.
Paul DeAngelo of DeAngelo Brothers, Inc., a Pennsylvania construction firm that has done millions of dollars of work for Rhode Island's Department of Transportation, was sentenced to 18 months in federal prison in 1994 for his involvement in a cocaine ring.
But on multiple occasions, under pain of "suspension, debarment and/or prosecution for fraud," DeAngelo has answered "no" to a question on Rhode Island state bidding forms asking whether "your firm (or any principal)" has "been subject" to "indictment" or "criminal conviction." DeAngelo did not return calls for comment.
Executives with Sealcoating, a Massachusetts paving company that pled guilty in 1995 to fraudulently obtaining federal contracts intended for minority-owned businesses, repeatedly answered "no" to the same question.
Elizabeth Wuori, president and co-owner of Sealcoating, couldn't offer an explanation for why she hadn't disclosed the firm's guilty plea. "We try to pay attention to those details," she told the Phoenix. "And I thought we were doing a pretty good job of it."
Hynes, the state's purchasing agent, said the companies' failure to disclose is "very concerning." "They should be disclosing that, absolutely," she said. "That's a signed affidavit." She added that the omissions could "jeopardize . . . the award of a contract."
But ultimately, she said, the state depends on contractors to self-report — and to police each other. Her department, she said, simply doesn't have the resources to verify what contractors write on the forms.