CHARLESTON, W.Va. — Lawmakers are asking whether state Attorney General Patrick Morrisey should more clearly be involved with a class action lawsuit claiming the asphalt for paving West Virginia’s roads costs too much because of monopolistic practices.
In October, the private firm Bailey & Glasser filed lawsuits on behalf of Charleston, Parkersburg, Beckley and Bluefield. A couple of days later, the state Department of Transportation jumped on board the lawsuit.
The Attorney General’s office has remained in the background. The issue came up before last month’s election, and Morrisey said he couldn’t discuss his office’s role because the issue is a pending legal matter. “We’re prohibited under the law from discussing that,” Morrisey said at the time on MetroNews Talkline. “We care very deeply about these allegations. They’re very serious.”
This afternoon, a spokesman for the Attorney General’s office made a similar statement.
“Our office and the Department of Transportation are engaged in cooperative discussions to handle this matter appropriately. There is no further comment at this time,” Attorney General spokesman Curtis Johnson stated in an emailed response.
Legislators on the Joint Legislative Oversight Commission on Department of Transportation Accountability asked Mike Folio, counsel for the DOT, to describe any participation by the Attorney General’s office.
“I’ve been having discussions with the AG, good positive discussions – we’re going to work together on this,” Folio said.
That answer wasn’t specific enough for Delegate Marty Gearheart, chairman of the committee. He asked the Transportation Department to prepare a narrative for the next time the committee meets to describe how and why outside counsel was selected instead of going with lawyers from the Attorney General’s office.
Folio told legislators that the price of asphalt had been the subject of his attention since he started his job Jan. 1, 2015. In response to a question about why a small town like Bluefield would be ready to file a lawsuit before the State of West Virginia could get its own case together, Folio said the state was nearly ready by November but still needed to complete an analysis.
“We weren’t really late,” Folio said.
He was asked if the Attorney General’s office turned down a role in leading the lawsuit.
“I was not involved in those discussions,” Folio responded. “I think Mr. Morrisey wants to be involved and he should be involved in this action. I’ve had discussions with him and his staff. He has an interest in protecting the taxpayers with this particular legal action.”
James Bailey, legislative counsel for the committee and no apparent relation to Bailey & Glasser, was asked similar questions about the Attorney General’s participation.
“I think it’s an open question. I wouldn’t want to ultimately state my opinion,” Bailey said. “There may be something else that I’m not aware of. As far as I can see, the Attorney General should be representing.”
The government agencies involved in the lawsuit claim competition among asphalt suppliers has been suppressed to the point that they’re paying 40 percent more to pave roads and patch potholes than they really should.
“The possible damages, which the state would be owed, is also massive,” Bailey told the committee.
The lawsuits contend that the asphalt suppliers have engaged in predatory practices, undercutting and sometimes absorbing competitors. The lawsuit names West Virginia Paving as well as several asphalt providers that are alleged to be either openly or covertly related.
“Combined, the defendants are an industry colossus,” the lawsuits claim.
Senator Mitch Carmichael, R-Jackson and the upcoming Senate president, said he is frustrated that a Division of Transportation audit didn’t bring more attention to the possibility of inflated asphalt prices.
“Is there anything within these bids that raises a red flag?” Carmichael asked.
State Transportation Secretary Paul Mattox said some aspects of paving contracts hadn’t been adding up — like a recent trend toward single bids.
“We first became aware of it when had an analytical group take a look at the bids — the number of single-bid contracts the department was getting,” Mattox said. “As a result of our initial look at our bids, it raised a lot of red flags. Since that time, legal division has gathered information to prepare for this court case.”
Folio said the agency is paying increased attention to what’s happening with paving bids in other surrounding markets.
“We are looking region by region by region, measuring both cost and quality,” he said.
He said more and more related information is available digitally and could be subject to comparison.
“You can see patterns of collusion or potential patterns of collusion. That’s what we are doing from a programmatic standpoint.”
He said his own experience with potholes has led to personal frustration.
“We are paying too much and we have inferior quality,” Folio said.