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Contractor Lawsuit Halts Akron Projects

Tue July 09, 2002 - National Edition
Construction Equipment Guide

A contractor’s lawsuit questioning the way the city of Akron, OH, hands out high-dollar road projects has stalled several projects during the height of the construction season.

Michael Construction Co., of Akron, filed suit against the city recently after the city rejected all the bids related to the construction of wheelchair ramps on Kenmore Boulevard and some surrounding streets.

The lawsuit contends the city is selectively enforcing a policy regarding a common practice known as "unbalanced bidding" and that Michael Construction was left out of the loop when it came to $4.6 million worth of other road projects because of it.

Summit County Common Pleas Judge James Williams granted the construction company’s request for a temporary restraining order blocking the awarding of contracts for work on Bellevue Avenue, Oregon Avenue and a combined project involving three other roads -- Roberts, Weeks and Torrey streets.

Also, the city held up another project -- Superior Avenue, of which Michael was the low bidder -- while awaiting a determination by the judge.

In the Kenmore project, Michael’s bid of $475,229 was the lowest of the four the city received. But city officials reviewing the bids determined all were unbalanced and should be discarded -- a recommendation the Board of Control followed.

Unbalanced bidding is a common practice in which contractors underbid on some line items on the assumption that the city won’t end up needing them all to complete the project and overbidding on other items that might increase in need as the project moves forward.

It’s not an illegal practice, but the city’s policy always has been to make it clear to bidders that unbalanced bids -- unless they are in the city’s best interest -- could be rejected.

The Kenmore bids raised no eyebrows up until the Board of Control’s rejection.

In a letter dated June 6 to the four bidders on the Kenmore project, Kenneth Kostura, administrative services manager for the Akron Engineering Bureau, explained that the bids were rejected and that "the city will not accept unbalanced proposals for this contract, nor for any contract in the future."

A corrective letter -- stipulating that unbalanced bids would be rejected unless they are in the city’s best interest -- was mailed June 20.

But bids for the street projects now being challenged came in just before the first letter was mailed or in between the mailing dates of the first and second letters.

Michael Construction blames that initial letter for altering the way his firm bid on the other street projects -- causing his firm to lose out on the lucrative contracts.

The suit also contends the city was set to award contracts on those projects to other firms that submitted unbalanced bids in direct violation of the city’s policy as stated in the June 6 letter.

Since the case was filed, attorney Pat D’Andrea, representing Cioffi Construction Co., has filed to intervene in the case because Cioffi was the low bidder on the $1.5 million Oregon Avenue project and stands to lose if all the bids for that project are rejected.

Also, Cioffi was set to start the Bellevue project -- meaning a lot of lost money if it doesn’t get started soon. Cioffi was the low bidder at $2.1 million and Michael Construction was the highest at $2.6 million.

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