Trumbull sues sewer contractor on heels of FBI investigation: seeks more than $5 million in damages

Trumbull sues sewer contractor on heels of FBI investigation: seeks more than $5 million in damages

Source: http://www.ctpost.com, March 19, 2011
By: Amanda Cuda

The town is suing Bridgeport-based Mark IV Construction Company for about $5.1 million, related to work done on a much-contested town sewer expansion project. The lawsuit comes a week after town First Selectman Tim Herbst announced that Trumbull’s Water Pollution Control Authority was under a federal grand jury investigation.

The eight-count suit against Mark IV, filed Friday morning, alleges fraud, negligence, breach of contract and other offenses on the part of the company related to the sewer expansion project. The project affected roughly 730 homes in the town’s Jog Hill section. The town has also filed a prejudgment remedy of attachment, which would secure up to $18 million of Mark IV’s assets so that they’ll be available should the town be granted a reward.

Kenneth Rozich, the New Haven attorney representing Mark IV in the suit, declined to comment on the action when reached Friday afternoon.

During a press conference Friday, Herbst said the suit was filed in the wake of several troubling findings revealed in a forensic audit conducted last year and in an engineering study completed by the Shelton firm Tighe & Bond this week. An executive summary of the Tighe & Bond report, also released at Friday’s conference, showed, among other things, an overpayment to the contractor of $463,584. It also revealed numerous physical defects within the sewer system that would cost about $4.7 million to repair.

Herbst said the lawsuit and the FBI investigation target work that took place before he took office. The lawsuit in particular, he said, is his administration’s attempt to rectify the problems caused by the construction project. “We did not create this mess,” Herbst said. “We inherited this mess.”

He said one of his biggest concerns about this project is the “exorbitant assessments for substandard work” faced by residents of the Jog Hill area. “My most solemn duty is to protect the residents and taxpayers of the Town of Trumbull,” he said.

Former First Selectman Raymond Baldwin, who was the town’s leader when the project began, wouldn’t comment on the lawsuit.

The forensic audit, the results of which were released in September, found a variety of irregularities on the sewer expansion project, including a $3.5 million contract extension awarded to Mark IV in violation of the town charter. The Jog Hill project, which started in 2007, was originally estimated to cost about $15 million. By the time it was finished in 2009, it reportedly cost about $21 million.

The audit cost about $40,000 and was conducted by the Providence, R.I.-based firms CCR Certified Public Accountants and Business Advisors and the Beta Group. Herbst said Tighe & Bond was retained following the audit’s release to perform an analysis of construction on the project, and the associated costs incurred by Trumbull.

The problems cited in the Tighe & Bond report included sunken streets in roughly 26 percent of the Jog Hill area, and 365 pipe defects throughout the project. The report showed that defects in the work allow for groundwater to seep into the pipes. The water is unnecessarily treated as sewage. The report said that the town pays to treat roughly 7.2 million gallons of water per year that it doesn’t need to.

The lawsuit filed Friday reiterates many of the points made in both the audit and the engineering report, including that Mark IV prepared and submitted applications for payment for work that was not completed and that the company prepared and submitted applications for payment for work that was completed in a sub-standard fashion. The suit was filed by Fairfield attorney Neal Moskow, who was retained as a special counsel to Trumbull’s Water Pollution Control Authority late last year.

Trumbull isn’t the only town to have issues with Mark IV. For instance, in December 2008, the town of Milford terminated its contract with the company after a 1950s-era sewer main was found to be encased in cement. At the time, Milford officials said the company’s estimate to remove concrete from the pipe was too high.

Mark IV is in the midst of another sewer project in Trumbull, known as the North Nichols expansion, but Herbst said that part of the project is proceeding well, due to the fact that Tighe & Bond is overseeing the project. The company also has done sewer projects for the town in the past. Herbst said he didn’t foresee any legal action would be taken in connection with those projects.

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