New Jersey Contractor Pays $1.87 Million to Resolve DBE Fraud

Kiewit Contractors, Inc. has agreed to pay $1.87 million to resolve allegations that the company improperly reported Disadvantaged Business Enterprise (DBE) participation on a federally funded construction contract. In 2009, the company entered into a $63.8 million contract with New York State Metropolitan Transportation Authority’s (MTA) Long Island Rail Road (LIRR) to design and implement Phase II of the Atlantic Avenue Viaduct Rehabilitation Project.  Under this contract, Kiewit was required to subcontract with DBEs and establish goals to ensure the contractors made “good faith efforts” to achieve these goals.

Kiewit then entered into an $11.9 million subcontract with Iron Eagle Construction Corp., a then DBE-certified steel erection company, to furnish and install steel spans. 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.

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