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DiNapoli urges DOT to terminate contract with debarred company

NEW YORK  - State Comptroller Thomas DiNapoli today called upon the state Department of Transportation to terminate a $1.9 million contract with Bronx-based Steed General Contractors, Inc. Steed was debarred from bidding on state contracts in January by the state Department of Labor (DOL) because it was closely tied with a company with prevailing wage violations.

“New York State should not be doing business with companies that are not paying fair wages to workers and breaking the law,” DiNapoli said. “Since Steed has not started any work on this project, the responsible action for DOT is to re-bid this project and ensure work is done by an honest contractor.”

In May 2009, Steed was awarded a $1.9 million contract by DOT to paint bridges in Suffolk County. The work on the contract is scheduled to begin in the spring.

After this contract was awarded, DOL investigated whether Steed was connected with another company, Delphi Painting and Decorating, which had been debarred by the state for prevailing wage violations. In August 2009, DiNapoli rejected a second contract that DOT attempted to award to Steed. The contract, a $7 million stimulus-funded contract for painting bridges in Putnam, Orange and Dutchess counties, was rejected because of the pending investigation. In January, DOL concluded its investigation, determined that Steed was affiliated with Delphi and debarred Steed from bidding on state contracts from October 2007 to October 2012.

DOT has indicated to the Comptroller’s office that it has a long standing policy not to terminate existing contracts even where a contractor is debarred for future work and plans to have Steed complete the project. However, because no work has begun, DiNapoli notes that the contract contains a provision that allows DOT to cancel the contract and re-advertise the project.