CHARLESTON, W.Va. — The state Department of Transportation is worried about the price it’s been paying for asphalt.
The state’s growing concern spiked after four West Virginia cities filed lawsuits Wednesday, claiming West Virginia Paving and related asphalt suppliers.have created a near-monopoly, resulting in asphalt prices 40 percent higher than they should be.
“The state is concerned with this situation, and has been for some time,” according to a statement released by Carrie Jones, spokeswoman for the state Department of Transportation.
Last year, according to the statement, lawyers for the state Division of Highways retained an industry expert to review the state’s asphalt contracts.
“Through that process, a regional approach was taken to see what surrounding states are paying for asphalt to determine whether rates paid by the Division of Highways are appropriate. The results of that report are expected soon and the state will take whatever action is necessary.”
The cities of Charleston, Parkersburg, Beckley and Bluefield filed class action lawsuits Wednesday. The cities contend that the asphalt suppliers have engaged in predatory practices, undercutting and sometimes absorbing competitors.
West Virginia Paving released a statement in its own defense this afternoon:
“Although WVP has not been served with any of the lawsuits, WVP obtained a copy of one of the lawsuits and believes that there is no factual or legal basis for the lawsuit.”
MORE Read West Virginia Paving’s statement
The asphalt company contends there is more competition than what is described in the lawsuits. the company also says the price of asphalt is caused by the costs of transportation and raw materials.
“The cities’ assertion that WVP and various other defendants inflated the price of asphalt by up to 40 percent is blatantly false,” West Virginia Paving stated in its release.
West Virginia Paving said the cities could reduce their costs if they would issue contracts that tie the price of asphalt to an index reflecting changes in the cost of liquid asphalt.
“To date, these cities have refused to adopt a liquid asphalt index for asphalt paving projects so contractors bidding work in these cities are forced to charge higher prices for asphalt in order to reduce their exposure to unexpected liquid asphalt price increases implemented by large oil companies.”
One of the lawyers who worked on the class action suit appeared today on a radio program hosted by Charleston Mayor Danny Jones.
“It is important people realize this is not just the city of Charleston, Bluefield, Beckley and Parkersburg suing for damages to them,” Mike Hissam, a lawyer for Bailey & Glasser said today said in an appearance on “580 Live” on MetroNews affiliate WCHS.
“They’re stepping up, putting their foot forward and saying we’re suing on behalf of all West Virginians affected, that includes individuals and small businesses.”
MORE Read the City of Charleston’s lawsuit here
The lawsuits mentioned the overall quality of West Virginia’s roads and said state highways would be in better shape if paving and patching were more affordable.
“Defendants’ conduct is particularly egregious given the state of West Virginia’s roads,” according to the lawsuits. “Many of West Virginia’s roads are in a state of disrepair, with repeated calls from the public for cash-strapped governments to ‘fix the roads.’”
During Tuesday evening’s gubernatorial debate, Republican gubernatorial candidate Bill Cole discussed trying to save money in the highways department by eliminating waste and fraud.
“I’ve met with countless employees of highways, good employees, people who are solid West Virginians who are so fed up with the waste and the corruption and the back room deals. And they do exist. And we need to get rid of those so when we invest the taxpayer dollars in our infrastructure that we’re investing them as best we can.”
His opponent, Democrat Jim Justice, said that as Senate president, Cole should have taken care of any concerns already.
“I don’t get it. I just don’t get it,” Justice said.