Pennsylvania contractors are pushing for greater clarity and consistency in how state officials handle COVID-19 lockdown measures in the wake of a highly critical audit report.
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State auditor Eugene DePasquale recently released a preliminary report that found wide-ranging inconsistencies in how state officials doled out waivers to contractors and other businesses during the COVID-19 lockdown this spring. The report rang true to David Daquelente, executive director of The Master Builders Association of Western Pennsylvania. A number of his members were doing work for hospitals and other health care organizations when Pennsylvania Gov. Tom Wolf (D) rolled out one of the strictest lockdowns in the country.
“If this were to be instituted again, our expectation is that there would be much better information that would be provided, not only about the requirements for a waiver, but also an understanding and an explanation of why something had not been accepted,” Daquelente said.
While many contractors were able to continue work after putting COVID-19 protection measures in place, that was not always the case. Daquelente noted that one of his members, a construction company with projects in the health care sector, was denied a waiver by state officials, even as a real estate development firm, owned by the same parent company, was granted a waiver because the property it managed had a grocery store.
Restrictions have since been lifted on Pennsylvania’s construction industry, and there are no indications that another lockdown is looming or would be needed, he said. However, contractors also are hoping the audit’s findings are taken to heart by the state government, after much of Pennsylvania’s construction industry was shut down for five weeks last spring, from March 21 to May 1.
The report by DePasquale, the state auditor, found 500 cases where Pennsylvania's Dept. of Community and Economic Development (DCED) issued one decision on whether a business needed a waiver, only to issue a second ruling later that either revoked it or granted approval.
In 73 cases, the department pulled back permission for waivers that had been initially granted, while in 48 cases, businesses were initially told a waiver wasn’t required, only to be told later they not only needed a waiver, but also that it would not be granted.
Another 171 waiver applications were rejected, only to be approved later.
“The waiver program appeared to be a subjective process built on shifting sands of changing guidance, which led to significant confusion among business owners,” DePasquale said in a press statement.
The state auditor pointed to one construction company that had seen wildly varied results in its waiver applications. The company applied to renovate three installations owned by the same communications company, only to have two waiver requests rejected and one approved.
In another case, a contractor applied for waivers to repair the roofs at two different hospitals. In one case, state officials granted the waiver, while in the other, the contractor was told that no waiver was needed at all.
A spokesperson for the Dept. of Community and Economic Development said Pennsylvania was one of a few states with a waiver process, and that findings of the audit report are not yet final.
“The Wolf administration will continue to cooperate with the Department of the Auditor General, and DCED looks forward to reviewing and formally responding to the final report when it is issued, and is confident that any concerns expressed in this status update will be addressed appropriately,” the spokesperson said.
Jon O’Brien, executive director of General Contractors Association of Pennsylvania and the Keystone Contractors Association, called the waiver process “inconsistent.” He said contractors from across the state told him that they "either never heard back from DCED or were denied, despite their competitors down the road having their business waiver approved.”
Further confusing matters, O’Brien says, “many companies who were denied were told by their government officials to reapply again, since another set of eyes at DCED may approve.”
O’Brien said some owners told contractors to continue working despite not receiving a waiver. "Now that's a business development nightmare that companies should not have to face," he said. "Do you follow the rules and shutdown your project? Or do you keep working for that client who's been good to your company over the years?”
While Daquelente agreed that there was little rhyme or reason related to the waiver status, he did acknowledge "that the administration and leadership were having to make informed decisions while information was consistently evolving; however, our experience was that the decision-making process around the waiver was inconsistent at best.”
