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Fact Finder: MDOT Out of State Contractors?
Posted: 06.08.2010 at 8:44 AM
Marc Schollett

Edward R. Murrow Award winning journalist Marc Schollett can be seen co-anchoring 7 & 4 News at 5,6 and 11 weekdays.

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When we wrap up every Fact Finder report we ask for you thoughts and comments. Sometimes that feedback raises new questions that have us digging deeper into a story. That is certainly the case with a story that we first aired a few weeks ago. That story was launched when one of our viewers who lives along Glen Lake Road near M-22 in Leelanau County saw some road work that seemed like a waste of money, she wanted answers. What she saw was a several mile long repaving project from the village of Glen Arbor to the narrow's bridge. She says about a week ago the lines along the road were painted. Then, less than a week later, the same Ohio based company that painted the lines paved over them. The next logical step on top of that fresh asphalt would be to repaint the lines. She wondered isn't that a waste of paint and taxpayer dollars?

I had to go check this out myself so I drove to the stretch of road. Sure enough, freshly painted lines were being paved right over. So I got on the phone with MDOT to get some answers.

Here's what MDOT told me: In order to do this specialized repaving called micro surfacing, the old painted lines and markers have to be ground off. Essentially the old lines are removed to prep for the new pavement (think of it as stripping old wall paper before hanging new paper). After the old lines are gone, the roads are bare, and that can be dangerous. Drivers might have a tough time knowing where no passing zones are along this curvy stretch of road without pavement markings. So MDOT required in their contract with the company that temporary lines with special thinned down paint be laid down until the new pavement is in place. At which time, permanent lines are painted.

So how much did this painting project actually cost? According to MDOT the temporary paint project (material and manpower) cost about 1/2 of a percent of the total project cost.

We found that answer, but an awful lot of folks wondered with so many Michigan workers out of jobs, why an *Ohio* company was hired to do the work in the first place?

It's a great question that deserves an answer.

First, regarding this situation...MDOT says it was an Ohio company, but if you dig a little deeper you'll see that 15 of the 18 workers on the payroll are actually Michigan residents. MDOT says it's not uncommon for a company head quartered out of state to have branches here in Michigan, and employ in-state residents. On top of that, this Ohio based company hired two sub contractors from Michigan to help with this project. So it's not accurate to paint the picture that all our taxpayer money left the state when the job was done.

But still, how did the Ohio company get hired in the first place? The bottom line is that they were the cheapest. To receive federal money for road projects, MDOT says they are contractually obligated to take the lowest bid on a project, regardless of where the company is based. MDOT says they can't play favorites by paying more to a Michigan company when someone else will do the job for less.

So how does it all break down? Last year, MDOT awarded a total of $1.3 billion in contracts. 88% went to Michigan contractors, and 12% went to out of state firms. That's the trend that actually held remarkably steady over the past 5 years. Over that time frame, MDOT has awarded between 87% and 89% out of its contracts to Michigan vendors.

Bottom line if a Michigan company is the lowest bidder they get the job but if they don't land the contract, it doesn't necessarily mean that Michigan workers won't get hired.

What do you think? A fair system? Would you be willing to pay more for a project if it meant a Michigan company was hired?

Leave your thoughts below.

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