State College Borough Council Approves $74,000 Paving Contract with Glenn O. Hawbaker

State College Borough Council on Monday approved a paving contract with Glenn O. Hawbaker Inc., but not before one councilman raised questions about wage theft charges recently brought by the Pennsylvania Attorney General’s Office against the Centre County-based company .

Borough Manager Tom Fountaine said, however, that there was no legal basis to reject Hawbaker’s low bid of $73,837.50 for paving the access road and stormwater management improvements at State College’s compost facility. The borough also stood to lose a state grant funding the project if it is not completed in the next five weeks.

Council voted 5-2 to award the contract, with President Jesse Barlow and Councilwoman Katherine Yeaple voting no.

Hawbaker is accused of stealing $20 million from workers on public projects in what Attorney General Josh Shapiro called “a massive, unprecedented fraud on two distinct fronts.” Shapiro’s office alleges Hawbaker took money that was required to go to prevailing wage workers’ retirement funds and health benefits and instead used it throughout the company, including for executives.

Shapiro alleged Hawbaker was able to underbid other companies by using that money to offset its costs — something Barlow brought up on Monday.

“I wonder if that’s how he’s managing to get the low bids all the time,” Barlow said. “I seriously wonder if we ought to question this.”

Fountaine said the Pennsylvania Department of Transportation has suspended Hawbaker (one of the biggest PennDOT contractors in the state over the past two decades) from bidding on projects for three months.

Hawbaker, however, has not been prohibited from bidding on any other public projects like the borough paving job, Fountaine said, adding that the company has not been convicted.

“I think, of course, people are innocent until proven guilty and should always be treated that way,” Councilman Evan Myers said.

Fountaine said that legally the borough could not simply reject Hawbaker’s bid and choose the other qualified bid, which came in at $94,504, well above the $79,326 in grant money available for the project. Pennsylvania law requires public contracts to be awarded to the lowest responsible bidder. Council could either accept the low bid or reject all bids and start over.

If council were to reject the bids, money for the project would likely have to come from the borough’s own funds. Under the terms of the recycling grant awarded by the Department of Environmental Protection, the project must be completed by June 11 or State College will forfeit the grant.

Fountaine said the project could not be bid again and completed by then.

“At this point the timing of this project would not allow for the completion of the work and the borough would forfeit the $79,000 grant and would have to fund the project,” Fountaine said.

For its part, a statement from the company in April said Hawbaker has cooperated with the Attorney General’s Office since the investigation began in 2018.

“While we believe that we have always acted in accordance with all state and federal laws, in an abundance of caution, the company immediately changed its prevailing wage practices,” the statement said.

The company faces four felony counts of theft by failure to make required disposition of funds. No individuals have been charged in the case. Preliminary arraignment is scheduled for May 12.

Other Road Project Contracts Awarded

Council awarded contracts for two other road projects as part of the consent agenda with no discussion.

Hawbaker submitted bids for both but was not the low bidder on either.

Ameron Construction, of State College, was the low bidder at $1,658,649.10 for reconstruction of O’Bryan Lane and Oneida Street. The project involves full reconstruction of both roads between Westerly Parkway and Waupelani Drive, including roadway pavement structure replacement, curbs, driveway aprons, ADA curb ramps, sidewalk restoration, sanitary sewer main and lateral replacement, storm sewer improvements and waterline and water service replacements.

State College Borough Water Authority is reimbursing $411,065 for the waterline replacements.

O’Bryan Lane is expected to be completed around mid-August and Oneida Street around mid-September.

Sickler Construction, of Petersburg, was the low bidder at $42,330 for a project at Beaver Avenue and Locust Lane consisting of pedestrian crosswalk improvements, ADA curb ramp installation and street light relocation at the intersection.

The anticipated completion date is July 5.