Grand jury subpoenas 13 road contracts

SEVEN WERE AWARDED TO LAWSON

jcheves@herald-leader.comAugust 21, 2008 

A federal grand jury hearing evidence about alleged bid rigging in the Kentucky Transportation Cabinet has subpoenaed 13 road contracts and related items, said cabinet spokesman Chuck Wolfe.

Prosecutors want the documents so they can prepare trial-ready courtroom exhibits, Wolfe said Wednesday. The subpoena was served last week, although the cabinet has willingly provided all information and records on request, he said.

“It appears they're wanting to be meticulous about the paper trail as they gather evidence,” Wolfe said.

According to a report by WHAS-TV in Louisville, seven of the 13 contracts in question went to companies related to Leonard Lawson, a politically influential contractor who is at the center of a related FBI investigation.

The grand jury is meeting in Lexington to investigate possible corruption in the contract-awards process at the cabinet.

An FBI search warrant affidavit filed in U.S. District Court in London recently alleged that Lawson bribed state highway engineer James Rummage during former Gov. Ernie Fletcher's administration to get confidential cost estimates of road projects.

The internal cabinet estimates could help a contractor maximize profits, especially if the contractor were the sole bidder. The cabinet typically rejects bids that are more than 7 percent greater than its own estimate.

According to information obtained by the Herald-Leader through a public records request, bids by Lawson-related companies were exactly 7 percent higher than the cabinet's estimates on five contracts in 2006 and 2007. Transportation records also show that Lawson's companies bid between 6 percent and 7 percent higher on 11 contracts.

Rummage sometimes gave the secret estimates to Lawson, but on other occasions he gave them to former Transportation Secretary Bill Nighbert, according to the affidavit. The affidavit also alleged that Lawson might have tried to repay Nighbert by funneling money through an Eastern Kentucky corporation.

No one has been charged.

Rummage is cooperating with prosecutors.

An attorney for Nighbert has said his client has done nothing wrong.

Lawson's lawyer has questioned why information about the investigation has been leaked to the public, and stressed that Lawson should be presumed innocent.

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