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Friday, January 06, 2017

Litigation Adds $1.5M and 1 Year to NorCo's Bridge Bundling Project

Att'y John Lushis
In October, Northampton County Council voted 7-1 to approve a bridge-bundling ordinance under which 33 of the County's 119 bridges will be conveyed to the General Purpose Authority (GPA) for repairs at 20-30% less than would be paid if the County were to do the work itself. In addition to being cheaper, Executive John Brown has argued that the work will be done more quickly.

County officials expected that the GPA would award the $31.5 million deal to Kriger Construction, located in Dickson City. Work was expected to start right away and take about four years, followed by a 10-year maintenance period. But at their January 5 meeting, Council learned that the project will be delayed at least a year. In addition, it will cost about $1.5 million more than anticipated. The County's annual payment over 12 years will increase $125,000.

"We haven't even started and we have a five percent increase," complained Ken Kraft, who has steadfastly opposed this project from the beginning.

But why? Is it concern over being low-balled or the use of an unqualified contractor, or does Kraft have some other agenda?

In addition to his duties as a Council member, Kraft is also the business agent for Painters Local 1269 DC 21. He is also a member of the Lehigh Valley Building and Construction Trades Council, a consortium of local trade unions. Though the only persons qualified to perform bridge repairs belong to a trade union, Kraft seems to be concerned that other unions will do this work, to the exclusion of Lehigh Valley trade unions.

Though nobody is talking, the County appears to be the victim of a turf war between Lehigh Valley and other trade unions.

One of two lawsuits challenging this deal, filed by Kevin Lott, demonstrates that the Lehigh Valley trades unions are opposed to Kriger's selection as the contractor. Lott is the business agent for the Lehigh Valley Carpenter's Union. He inexplicably withdrew his suit in November.

A disappointed bidder, Clearwater Construction, has filed another suit over the award, claiming that Kriger is unqualified and alleging irregularities in the selection process. Interestingly, Clearwater is represented by the same Allentown law firm that represented Lott.

Judge Craig Dally ruled in October that Clearwater lacks standing. His decision was appealed to the Commonwealth Court, where argument is tentatively scheduled for March. Kevin Lott, a Hellertown resident and trades union organizer, has also sued.

Ken Kraft is the sole Council member to vote No to this ordinance, even though one of the union painting that he represents, would be used by Kriger. Kraft had no comment, but has previously complained that Kriger is unqualified to replace bridges. He is also concerned that there will be cost overruns because Kriger low-balled the project.

Executive John Brown has previously touted this bridge bundling project, arguing in an interview with PCNTV that the County lacks "the capacity to do this" and that it's time to "stop pretending we're going to get to the bridge repair." He has claimed that PennDot sees this "a pilot project that, when successful, they'd like to probably roll it out to the other 66 counties in the state. We're very fortunate that the Federal Highway Administration is taking a look at our project as a model to roll out, potentially nationally."

Mike Bonini, director of PennDOT’s P3 project, has said that Northampton County is blazing a trail for other counties.

Brown told Council that, even with the delay and added cost, the project is in the County's best interest. He noted that Kriger's bid is still tens of millions of dollars less than Clearwater's. "I still stand by the contract," he said, noting that the agreement was written in a way to prevent what he calls "cost creep."

John Lushis, GPA's Solicitor, claimed that the litigation gave Kriger cold feet and that an agreement still remains unsigned, although he expects it will be in place next week. "This litigation has had a very significant impact, and it's not just the litigation ..., but it's been the actions that have occurred behind the scenes by certain people ... ." He called those actions "dishonorable" and "distasteful."

At one point, Lushis confronted Kraft. "You checked me out, I know that. Quite erroneously, in fact."

Lushis went on to say that he was confident that the Clearwater appeal, despite the delay it caused, will ultimately fail.

40 comments:

Anonymous said...

Doesn't Northampton County have a local labor ordinance on the books from the 1990's?

Anonymous said...

Think positive

The million and a half gets added to the nations GDP.

Bernie O'Hare said...

Not sure if there is a local labor ordinance but the GPA owns these bridges, not the county. What I do know is that union labor will be used, and LV Trades Unions are cutting off their noses to spite their faces.

Ken Kraft said...

gauranteed this will cost taxpayers more money in the end, my friend

Has nothing to do with local trade unions Your spin is biased because your mad at me for my last two votes

If you want to report accurately, stop and ask me my intentions, when you guess you make a fool out of yourself

Anonymous said...

unions suck, as well as their leaders. nothing but over priced crybabies. Rather have a sister in a whore house then a brother in the union.

Anonymous said...

And your sister still makes more money than you

Anonymous said...

Where is Nivile they are a approved PEN DOT contractor?

Anonymous said...

Krieger has completed numerous bridge replacements for the Commonwealth of Pa. ( 2 of which are underway in nearby Monroe County and 2 others which they were just awarded to complete). Clearwater is just pissed off they didn't get the work , because they thought they had the inside track on this. They forgot one little detail called "Public Bidding". Project is prevailing wage so Mr. Kraft and his buddies can suck it !

Anonymous said...

Seems like a no brainer. If Kraft is against it, it must be good for the 99% of county taxpayers not represented by him. Shouldn't he recuse himself from the vote? He has a vested interest, no?

Anonymous said...

Yes there is a "local labor ordinance", it has nothing to do with unions but does require county money on projects to go to local workers whenever possible. What is the point of county law if no one bothers to enforce it.

Anonymous said...

Wait until the project starts and they claim there are subsurface conditions for every other bridge. Then you will see what true cost overruns look like. Brilliant choice NorCo!

Jeff Fox said...

IMHO $1.5 million in cost overruns and we have not even begun the project! That does not give me a warm and fuzzy feeling. Lawyers, although necessary in today's world, do add to the cost of any contract, especially government contracts such as this. Delays and lawsuits, especially in this day and age and especially in this new adventure, seem to be “par for the course”. If Kriger has bridge building experience, then it should know that when bidding a contract for this type of work, that costs for the entire time-frame of the contract should be included in said contract. There should be no additional cost for re-bar (as referenced at last evening's meeting). Although the future cost is unknown, that should be figured into the contract. When bidding, some risk must be assumed by the bidder. If the cost of X (re-bar) goes down or stays static, the profit margin increases. If the cost of X (re-bar) goes way up, then margins go down. That’s the way business works. If Kriger has experience, especially with bridges, then it should be aware of the environmental impact studies, permits, habitats, including bog turtles (which were referenced at last evening's meeting), etc... which would be necessary to complete the project, therefore, figured into and included in the cost of the contract and the bid. They should not be caught off guard by this and charge NorCo more money. My instincts, after last evening's meeting, are that Kriger may be utilizing the situation concerning the litigation as well as the text of the contract to their pecuniary advantage. This deal is not off to a very auspicious beginning.

Bernie O'Hare said...

" Shouldn't he recuse himself from the vote? He has a vested interest, no?"

Under the state ethics act, a council member must recuse himself in any matter in which he has a pecuniary interest. So far as I know, he has no private pecuniary interest in this matter. The LV Trades Union Council apparently does, but the state ethics act specifically states that the term "conflict of interest" has no application to a "subclass consisting of an industry, occupation or
other group which includes the public official." So I see no legal conflict, but certainly he is acting on behalf of whatever agenda is being pursued by the LV Trades Unions. I consider that a moral conflict bc his job is to represent all the people.

Bernie O'Hare said...

"unions suck, as well as their leaders. nothing but over priced crybabies. Rather have a sister in a whore house then a brother in the union."

I completely disagree and find it astonishing that so many people have such hatred for a group that basically cleared the way for most of us to have meaningful wages. This is not about unions,it is about one group of trades unions that seem to be pigs. It is one thing to want union labor, but now they are dictating which unions.

Anonymous said...

So the GPA now owns county bridges? Is the county's Bridge Division still responsible for maintenance? Is the county's insurance through PCoRP still covering them? GPA's insurance should now be responsible.

Bernie O'Hare said...

"If you want to report accurately, stop and ask me my intentions, when you guess you make a fool out of yourself"

Ken, I have asked you on numerous occasions what your beef is with this deal, and you have not been honest. You have engaged in the personal attacks that Lushis finds so "distasteful" and "dishonorable." I know, bc you have attempted to play me with them. From the beginning, you have tried to sabotage this deal. From the beginning, my question has been why?

1) You claimed Kriger is unqualified as per PennDOT, but there was ample evidence presented that it is, and PennDOT itself so acknowledged.

2) You claimed improper influence but were embarrassed whenever you publicly made accusations. At an open meeting, you claimed that Solicitor Ryan Durkin's father was involved, and that was complete horseshit, as Durkin made clear.

3) I thought perhaps you might be concerned that unions were being cut out,and I would want this to be union bc their people get a decent wage. But I learned that, when it comes to bridge work, the only people who are qualified are members of one or another trades union. So this is not about trade unions, but about a specific trade union. You want the work given exclusively to the LV Trades Union Council.

4) Kevin Lott is one of your trade union colleagues and filed a suit of his own in this matter. The trade union friendly firm in Allentown,which includes one of the Butz boys, has been involved in both the Lott lawsuit and the Clearwater suit. This has been a turf war, pure and simple.

5) Your turf war has cost the County $1.5 million and is delaying work on bridges in need of repair by a year. You have done a grave disservice to the county you ostensibly represent.

6) How you voted concerning Allen and Weaver is completely irrelevant to me. I do not think like you. You could have voted No in those instances and I would still be writing what i wrote.I have an obligation to tell my readers who, where, why, when and how. I have tried to explain, as fully as my limited abilities allow, the why. It certainly appears to be some sort of turf war. I don't have to taste dog shit to know dog shit when I see it.

Bernie O'Hare said...

2:04, the GPA owns the 33 bridges bundled for this project. There will be four years of construction and ten years of maintenance. The county is footing the bill. I am unable to answer your insurance question.

Anonymous said...

So only 33 out of 109 bridges are owned by the GPA. They better have seperate insurance on them!

Anonymous said...

Ken is right on this one. How can an Authority that has no employees own all these bridges? This entire bundling is more bungling than it is worth. Another example of if it worked good in the past fix it anyway.It is not beyond the County`s ability as much beyond the ability of the elected administrative people in office presently. Blazing a trail? You kidding me...?

Jeff Fox said...

FYI...According to the approved and archived county council minutes: on October 6,2016, Mr Kraft voted to abstain from the vote on the resolution approving the service agreement for the P3 project. On October 20, 2016, Mr Kraft was the sole NO vote to amend paragraph 17 of the agreement. Mr Kraft was also the sole NO vote on the ordinance conveying the 33 bridges to the NCGPA as pursuant to the agreement.

Ken Kraft said...

Thanks Jeff

Bernie O'Hare said...

Jeff, I get the inconsistency. He initially recused himself and then voted. And Ken,I am still waiting for you to tell all of us honestly why you and your real constituents - the LC Trades Union Council - are opposed to a project that will create trade union jobs. Are you so piggish that it can only be your people?

Ken Kraft said...
This comment has been removed by the author.
Ken Kraft said...
This comment has been removed by the author.
Bernie O'Hare said...

Ken, So you have been against this from the start, and have even done so far as to try to dig up dirt on those involved, even though you fell on your face. Your LV trade union colleague, Kevin Lott, filed a suit. He just happened to use the same Allentown firm that Clearwater uses,which just happens to include one of the Butz boys. your actions here are being dictated by the LV Labor Council, and what's really pathetic about this is that the job will be a union job anyway. Thanks for costing NC taxpayers $1.5 million and one year or more of unsafe bridges. Be thankful also that the dailies no longer cover these kinds of antics. You must love the new county website, which includes your picture but does not allow the citizens to contact you. But you do not represent them anyway. You've lost touch. This is why Dems lost.

Anonymous said...

Cost under-estimates are normal under these circumstances. Even broken clock analogy right here..Brown does actually do the right thing on occasion. The concept is correct and pilot initiatives are not always sure fire deals. Keep trying council as this is what we pay you to do...think outside the box. Bravo!

Anonymous said...

Ken..you are hurting the party. Knock it off and do the right thing instead of what the boys in the back room tell you to do. Grow a set!

Anonymous said...

Once again..lawyers getting rich at tax payer expense as this is frivilous at best and just down right mean spirited BS!

Anonymous said...

Don't let O'Hare get to you Ken. he thinks he is the conscious of the county. This is a guy who sued the county due to his hatred of Reibman and cost taxpayers millions.

Bernie O'Hare said...

Actually, 8:32, my initial lawsuit against the county won. No less an authority than the Pa Supreme Court ruled in favor of the bond challenge. The county was forced to adopt a new bond ordinance, which I also challenged. We list the second round but the suit saved the county tens of millions bc it dropped some of its more nutty projects and interest rates dropped. The bond was a tragic error that resulted in a 66% tax hike over two years, as well as layoffs. This lawsuit will cost the county $1.5 MM and delay a project intended to save lives. I also have yet to hear a legitimate basis for this suit.

Unknown said...

Kriger may be a non union company. In pa a company can be union, open shop, or non union and still bid public work. The company I work for is non union but we are payed prevaling wage for what we do. Whether I tie rebar ironworker pay form concrete capenter pay or finish concrete cement mason pay I get payed by the prevailing wage rates in the county I work in. There are drawbacks with non-union companies as unquilified labor can switch trades to fill in or a company can take advantage of workers by paying them lower laborer wages and threaten to terminate if they dont accept. Ive worked with many guys over the years who have been bent over and not payed the right wages for what they do and are scared to talk or call L&I on the company. Union companys are top notch building a bridge is no easy task if there are just to many nonunion company who have the advantage of crosslabor and paying lower wages illegally or not. I would join a union in a second after 10+ years non union but the work on bridges ussually goes non union hk group , eckman , allen myers ect because of the advantages i talked about.

Bernie O'Hare said...

Kriger does use union subcontractors. As I mentioned in my story, the workers who are skilled enough to do bridge work tend to be all union This is nota battle for union work, which I coud understand. I actually think it is a battle over which union. Might also be a battle for subcontractors who use LV trade unions.

Bernie O'Hare said...

" The concept is correct and pilot initiatives are not always sure fire deals. Keep trying council as this is what we pay you to do...think outside the box. Bravo!"


Brown tried to use this to get himself elected auditor general and apparently is going to use it in his re-election campaign. While I completely support this project and hope it succeeds, he should refrain from patting himself on the back too hard. On a statewide level, the state is trying to replace 558 bridges. But how is the program doing? In October 2014, Plenary Walsh was chosen, along with 11 Pa-based subs, to start work in summer 2015 and be done in 36 months.
http://www.penndot.gov/ProjectAndPrograms/p3forpa/Documents/P3BridgeTeamSelect102414.pdf

Based on the blog about the project, the first bridge was finished in August 2015, on schedule. As of October 2016, 100 bridhes were complete,with 75 more on the way. The main obstacles are utility easements, the local communities, PennDOT itself, and difficulty in finding construction crews and pre-cast concrete. Less than half of the bridges were finished with 18 months to go, but PennDOT felt it would be finished on time. http://www.parapidbridges.com/bridgeblog/partnershipmakingprogressonsmallbridgereplacement.html

Anonymous said...

Mr. O'Hare:

To say lawsuits or Mr. Kraft are what added $1.5 million to the project is completely absurd. This is not a “turf war” as you claim, Mr. O’Hare. Because of his professional background, I believe Mr. Kraft understands the nature of transportation projects within the Commonwealth. If you recall, both the County Administration and GPA defiantly pushed forward even though the lawsuits were filed. One of the county's brilliant legal minds likened them to gnats that were being swatted away. Now they cry about their feelings being hurt which is complete nonsense. They backed a mule in a race solely for experienced thoroughbreds and now look like jackasses.

Firstly, at the time of the procurement, Kriger was only in possession of PennDOT prequalification codes to perform the rehabilitation portion of the project. I think this was 5 bridges or roughly 15% of the total project. They do not have the necessary work class codes to perform the new construction which is roughly 85% of the project. If this were a PennDOT job, they would not be able to even bid on the project because more than 50% of the project entails performing functions that they do not have the proper work class codes for. Having all the proper codes was a prerequisite of the RFP. The GPA apparently disregarded this. Also, having prior P3 experience was also a prerequisite of the RFP and the GPA also disregarded this.

If you listen closely to the GPA’s counsel, it is abundantly clear he is the driving force behind these public policy decisions. While Brown was gallivanting across the state with grandiose aspirations of becoming our next AG, this project was hijacked and steered in the direction of a firm that lacked the qualifications to bid on it. It takes deep, longstanding relationships to pull off something like this. Only a few people associated with the project have them.

There is also an inherent danger to the public good because if the GPA is willing to disregard the spirit of PennDOT’s regulations, what makes you think the contractor will follow PennDOT’s guidelines for building material standards? The short answer is that the contractor will not and now we have a potential public safety issue. It has been said that the contractor will be using a company that constructs septic tanks for their precast concrete needs.

Anyone with half a brain can realize there is more than meets the eye with this project. We’ve been shoveled shit and been told it’s sugar. Any sane would be very concerned doing business with a company that intends to load its books with $30 million to create the appearance of self-financing. Working with this amount of debt on a company’s balance sheet is disastrous to its financial health. GPA didn’t care about that either. Move on. Nothing to see here.

They applauded the proposed financing scheme. They didn’t even think about how a syndication of 3 banks could lend money at such a low rate despite the appropriation risk associated with this project. A sane person would be concerned when a construction firm needs 3 banks (that are not in the public finance business) to come up with $30 million for a public project. It was too good to be true because it was not real. That’s why the project is stalling.

You can chastise Mr. Kraft all you want but I applaud him for being the only voice of sanity on the dais.

Very truly yours,

Silence Dogood

Bernie O'Hare said...

Silence Dogood,

1) I do understand a bit about the law, and have never seen a lawsuit that claimed improper influence in obtaining a contract without specifying the nature of that improper influence. That alone makes the lawsuit improper.Judge Dally quickly ruled that the unsuccessful bidder had no standing and could not get to first base. I stop short of calling the suit frivolous bc it is a case of first impression, but its success is unlikely.

2) You are repeating the same tired claims that Kraft made many times and has been rejected many times. What you and Kraft both fail to point out is that a PenDOT rep was on the committee reviewing the proposals, and had determined that Kriger was in fact PennDOT qualified. I do have half a brain and see a project that is not one of the usual Philly or Pittsburgh boys. I see a modest savings to the county.

4) I see an effort to do something about our aging infrastructure, which is a matter of public safety. That concern appears to be missing from your analysis as well as that of Ken Kraft.

Thanks for playing.

3) I see that the personal attacks aimed at Lushis continue. You do not "do good" when you make these attacks and do not ID yourself. This is precisely what Kraft was doing.

4) Very clearly, Kraft has his marching orders from the LV Trades union and people like you, behind the scenes. If it is not a turf war, as I speculate, it is an effort to steer work to a contractor regarded as a friendly by the LV Trades Union Council. In addition to Kraft's opposition, we have the suit by Kevin Lott, a LV trades union member,and we also have the same law firm representing him as represented the unsuccessful bidder,and a law firm that includes one of the Butz boys.

5) As far as the financing goes, Kriger established it had the wherewithal to get the job done. A careful reviewof financing was very much a partof the RFP.

Anonymous said...

Oh come on Bernie, you are like a dog with a bone, even if the bone is BS. You were just fine with Ken's desire for local union guys when that was part of the deal for Stoffa to get his big building. The plan almost tanked when the builder nearly welched on using union workers. The deal was saved and Stoffa got the Dem votes for his trophy. Now Ken's desire is somehow bad?

Also your claim of saving millions on the old bond is nonsense. It was the same bond just different paperwork. You and your buddy Angle's hatred of Reibman cost the taxpayers dearly.

Look in the mirror before you go after others.

Bernie O'Hare said...

1) Of course I supported a centralized human services building. There are 18,000 people in need of human services in the county. Would you prefer they go without? Or have kids eating lead paint and guano?

2) Of course I supported union labor on the job.I support it here, too. Are you opposed topaying people a living wage? What Ken is doing is being a pig.

3) It was a bond with a lower interest rate that did save about $30 million. But its was still too much to spend and ended up costing us a 66% tax hike over two years and layoffs. My opposition had nothing to do with Glenn Reibman, who is a gentleman. It had everything to do with good government, something that eludes you.

Anonymous said...

Ref. comment on 1/6/17 posted at 2:04pm
County Bridge Division will be responsible for general maint. of the 33 bridges ( mowing, stream debris removal ,snow removal of walkways , guiderails .... The contractor will be responsible for the structural integrity of the bridge ( abutments ,wingwalls , decks, parapets).

Anonymous said...

FYI...Werner has decided to not run for county executive job.

Bernie O'Hare said...

Wise decision on his part. I will attempt confirmation.