Watch the Money
Connecticut will soon be getting a billion dollars in federal stimulus funds to help make our infrastructure safe. But as the money is spread around, will the process keep us safe from veteran insiders who know how to game the system?
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Tucked away between Ikea’s rear parking lot and the New Haven rail yard is a dreary plot of land guarded by rusty chain-link fencing and temporary concrete block walls. Inside are massive mounds of contaminated soil and highway debris, some covered in black plastic that billows and ripples when the wind blows in off the harbor.
The piles of dirt are being generated by an enormous state project designed to ease the gridlock where Interstates 91 and 95 converge, and where I-95 crosses the Quinnipiac River. Most motorists passing by barely give the work site a glance. Certainly, few would know that the disposal of these dirt humps carries a taxpayer price tag that escalated by 42 percent in one year to nearly $12.5 million, or that the beneficiary of these new millions in no-bid largesse is one of the state’s most controversial contractors, Earth Technology Inc. of North Haven. But state Attorney General Richard Blumenthal knows about it, and it makes him very upset.
Earth Technology has been the subject of federal and state corruption investigations for more than five years. Its owner, Frank Ruocco, has been accused of overcharging Connecticut hundreds of thousands of dollars and doing favors for state officials in return for sweetheart deals. A sister company Ruocco helped create was found guilty in a federal corruption case three years ago and paid a $500,000 fine. Indeed, it’s a situation that has left Blumenthal saying, “I am appalled and astonished that our oversight process has permitted this company to continue to work.”
But work it has. When Ruocco’s company was low bidder for the job to remove and store debris from the job in New Haven in late 2007, it was awarded an $8.8 million Department of Transportation contract despite its controversial past. State contracting officials explain that since neither Ruocco nor Earth Technology have ever been convicted of any 38 criminal charge, they have no legal ground to bar him from bidding on new state jobs. Less than a year later, DOT officials found reason to add $3.4 million to the original contract. A couple of other no-bid add-ons increased the total to $12.5 million.
Ruocco did not respond to repeated requests to be interviewed for this story, but in the past both he and his lawyers have denied any wrongdoing. And as he issues denials and the investigations drag on, the taxpayer dollars keep rolling in. Ruocco’s companies received more than $28.1 million in state payments in the past six years.
The Earth Technology saga has left Blumenthal “frustrated almost beyond words.” It also sounds alarm bells in the minds of other elected officials who have painful memories of Connecticut’s recent history of contract corruption.
Finding ways to properly oversee the dispersal of public money is about to become an even more critical issue. In the next few years, Connecticut is due to get an estimated $1 billion in federal stimulus aid for transportation projects—money we might not receive if there are problems in the system.
Like Blumenthal, legislative leaders in both parties have been pushing for additional protections and tougher sanctions against corrupt contractors. Their proposals include authorizing triple damages against corrupt contractors, more whistleblower protections and naming a state “inspector general” to ferret out contract fraud and waste. Gov. M. Jodi Rell, who promised to end Connecticut’s “culture of corruption,” has proposed a state Office of Accountability as an additional safeguard of taxpayer dollars.