PennDOT can’t stop State College company in theft case from bidding on state projects, court rules
The agency that oversees Pennsylvania’s highways cannot prevent a major State College-area construction contractor convicted of theft from doing state work, a statewide appeals court ruled on Jan. 19.
The 22-page decision from the Commonwealth Court marked a second legal victory in the past seven months for Glenn O. Hawbaker against the Pennsylvania Department of Transportation.
PennDOT wanted to bar one of the largest employers in Centre County from bidding on state highway projects for three years because it pleaded no contest to theft charges.
The plea meant the company agreed to be punished as if it were guilty, but did not expressly admit its guilt. No contest plea agreements cannot be used in civil or administrative proceedings.
The company said in a written statement Tuesday that it was “pleased” with the ruling and “looks forward to continue to serve both PennDOT and private clients.”
The state’s top prosecutor accused Hawbaker in April of illegally diverting millions and other benefits from its workers to boost its profits, undercut competitors and pay for bonuses.
Attorney General Josh Shapiro called it a “massive, unprecedented fraud” and the largest case of its kind nationally. The business that averages about $285 million in work annually pleaded no contest in August.
The company is on probation and agreed to pay for oversight by a corporate monitor for five years. It also paid more than $20 million in restitution to about 1,200 people who had money taken from them.
Commonwealth Court Judge Patricia McCullough criticized PennDOT for its handling of the attempted suspension, even questioning whether the agency has the authority to pursue the penalty.
The Department of Labor and Industry is responsible for prosecuting violations of the state’s prevailing wage law, and allowing multiple agencies to pursue penalties against the company could lead to “punitive, inconsistent and unfair consequences,” McCullough wrote.
It was not immediately clear if PennDOT plans to appeal the ruling. The agency is reviewing the decision and “considering its options,” a spokesperson wrote in an email Tuesday.
The Commonwealth Court ruled in July that a proposed three-month suspension enacted by PennDOT was unconstitutional. The company is also facing at least two lawsuits that run parallel to the theft allegations.
