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State suspends concrete contractor after price-fixing plea

Posted by: James Eli Shiffer Updated: May 30, 2014 - 2:45 PM

Updated 2:45 p.m.

A concrete contractor convicted of fixing prices for ready-mix concrete in Iowa was suspended from getting contracts with the Minnesota Department of Transportation.

This month's MnDOT suspension order for GCC Alliance Concrete grew out of a federal probe that revealed four concrete makers in Iowa conspired for three years to fix prices and rig bids for contracts. The investigation sent at least two executives to prison, including former GCC sales manager, Steven VandeBrake, who is close to finishing a 48-month sentence.

Under state law, Minnesota has to take action against contractors convicted of crimes. The company itself was charged criminally (yes, that can happen) and pleaded guilty in 2011 to violating anti-trust laws. Its punishment: 18 months probation, as well as $100,000 in free concrete for the paving and masonry needs of local non-profit organizations.

The suspension prohibits MnDOT from signing contracts with GCC Alliance Concrete for 60 days. But Amr Jabr, deputy director of MnDOT's engineering services division, indicated in his order that the state will pursue debarment, typically a three-year prohibition. If that happens, GCC would join a fairly small roster of state companies and individuals cut off from the state and local spigot. The number of debarred federal contractors is much longer.

"We're working on a resolution to that with the DOT as we speak," Ron Henley, GCC's vice president of ready-mix and aggregates, told me Friday. "We expect to have that concluded by Monday."

The penalty will not bring GCC to its knees - the initials stand for Grupo Cementos de Chihuahua, a Mexican corporation that grossed 8.4 billion pesos last year (about $652 million).

I'm not sure why it took three years from the guilty plea for the suspension order. I have requested information from MnDOT on how much state money GCC Alliance Concrete has obtained in the interim.  

Here's the MnDOT order:

GCC Alliance Suspension Order 05 15 14(1)

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