Actions Being Taken To Deal With Bid Rigging in the Federal Highway Program

Gao ID: PLRD-83-78 May 23, 1983

In response to a congressional request, GAO reported on the investigations conducted by the Department of Justice and the actions taken by the Department of Transportation (DOT) and others in response to a scandal involving conspiracies among contractors bidding on public road construction contracts.

Since 1979 Justice and DOT have been investigating paving contractors. These continuing investigations have already resulted in criminal prosecutions, convictions, fines, and jail sentences for conspiracies to rig bids on construction projects in 15 States. In 1982, Justice and DOT created a joint committee to coordinate antitrust investigations of these matters. DOT and industry associations have responded to the indictments and convictions by taking actions to deter or reduce bid rigging. DOT has: (1) improved its technical guidance on the preparation and use of engineering estimates; (2) surveyed State bidding procedures; (3) explored the use of computers as an evaluation and investigation tool; (4) debarred contractors convicted of bid rigging; and (5) established a telephone hot line to receive bid-rigging tips. The associations have suggested ways for strengthening bidding and contracting procedures and have conducted seminars on antitrust violations. State Governments have also made changes in response to the bid-rigging scandals. In addition, the Federal Highway Administration has made efforts to improve its guidance on reviewing contractor bids and proposals. Because many actions have not been completed, it is too early to determine how effective they will be in deterring collusion. However, GAO believed that the actions taken were appropriate steps to bring bid rigging under control.

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