Civil Settlement Reached With Kiewit Constructors Inc.

NEWARK, N.J. – A Delaware corporation headquartered in Woodcliff Lake, New Jersey, will pay $1.87 million to resolve allegations that it improperly reported Disadvantaged Business Enterprise (DBE) participation on government contracts, U.S. Attorney Craig Carpenito announced today.

On Aug. 25, 2009, Kiewit Constructors Inc. entered into a contract with the Long Island Rail Road (LIRR) to design and implement Phase II of the Atlantic Avenue Viaduct Rehabilitation Project. The Atlantic Avenue Viaduct is an approximately 1.5 mile long bridge connecting Jamaica, New York, with Brooklyn, New York. Kiewit’s work on the project, which was partially funded by federal funds, included furnishing and installing new steel girders and spans, along with related steelwork.

Because of the federal funds used on the project, the LIRR was required to establish a program requiring its contractors to subcontract with DBEs and establish DBE goals to ensure that contractors make “good faith efforts” to achieve those goals. Kiewit subcontracted with Iron Eagle Construction Corp., an established steel erection company certified as a DBE by the State of New York, to furnish and install steel spans.

The settlement resolves allegations that Kiewit failed to meet its DBE obligations under its contract with the LIRR. Under the subcontract, Iron Eagle was obligated to manage the steel fabrication process, conduct inspections, and coordinate steel delivery schedules. The United States contends that Iron Eagle did not perform a commercially useful function for the furnishing of steel spans under the DBE subcontract, in that it did not sufficiently manage the steel fabrication process, conduct necessary inspections, or coordinate steel delivery schedules. The United States asserts that Kiewit did not take contractually mandated steps to address Iron Eagle’s failure to perform a commercially useful function, and that it failed to meet its DBE obligations under the Contract.

U.S. Attorney Carpenito credited special agents of the U.S. Department of Transportation, Office of the Inspector General, under the direction of Inspector General Calvin L. Scovell III; special agents of the Port Authority of New York and New Jersey, Office of Inspector General, under the direction of Inspector General Michael Nestor; and special agents of the Metropolitan Transportation Authority, Office of Inspector General, under the direction of Inspector General Barry L. Kluger, with the investigation.

The government is represented by Assistant U.S. Attorney Mark C. Orlowski of the U.S. Attorney’s Civil Division in Newark, and David E. Dauenheimer, Deputy Chief of the U.S. Attorney's Civil Division in Newark.

Defense counsel: Frederick M. Levy Esq., Washington, D.C.