I-77 officials have yet to answer questions on impropriety
Since the announcement of the I-77 toll road project, several irregularities have come to light about the company contracted with its construction. Cintra, the Spanish conglomerate the NCDOT signed to construct the toll way, has a history of criminal proceedings and subsidiaries that filed for bankruptcy. In the face questions in regards to this suspect behavior and if these past doings had been disclosed before the signing of the contract, both Cintra and NCDOT have been silent.
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ccusations that the company managing the I-77 toll lanes project violated the terms of its contract remain unanswered, months after they were first made by a Cornelius woman.
Diane Gilroy sent letters to Attorney General Roy Cooper and the North Carolina Department of Transportation’s Inspector General this summer raising questions about whether the Spanish parent company of I-77 Mobility Partners, Cintra, had properly disclosed several criminal and bankruptcy proceedings.
Gilroy sent an additional letter raising the same concerns to Governor Pat McCrory in October
The contract signed by the NCDOT with Cintra Infraestructuras (A.K.A I-77 Mobility Partners) is invalid due to its undisclosed corrupt past and should be canceled immediately,” Gilroy wrote in her letter to McCrory.
“There are a plethora of lawsuits, fines, and convictions against Ferrovial Agroman, the construction division of Ferrovial S.A. (Cintra’s parent/I-77 Mobility Partners) and Cespa, its waste management subsidiary as well as the Louis Berger Group.”
Months later, Gilroy’s questions remain unanswered, even as the NCDOT Inspector General’s office reviews her claims.Cintra—the company behind I-77 Mobility Partners, which has the 50-year contract to build and manage the toll lanes—is a subsidiary of the Spanish company Ferrovial Agroman.
Ferrovial Agroman owns another subsidiary in Spain, Cespa, which has been fined twice since 2010 for engaging in price fixing in the public-sector trash collection industry.
Cespa was first fined in January 2010 as part of a group of four companies that was found to have fixed the market for healthcare waste management. The four companies were fined a total of €7,045,000 by the then-Spanish regulatory watchdog CNC.
Cespa was fined a second time, in January 2015, by CNMC, the successor to CNC.
The 2015 fine was levied against a total of 39 companies and three associations for forming what amounted to a cartel in the urban waste management industry, the watchdog said.
Ferrovial Agroman itself was the subject of an investigation in 2010 into allegations it paid off a political party in exchange for favorable contracts. The existence of that investigation was listed by Cintra on a disclosure form filed in 2012.
The comprehensive agreement entered into between NCDOT and I-77 Mobility Partners requires, at the least, companies involved in the project to disclose any criminal or civil judgments rendered against them within the past three years for fraud, embezzlement, antitrust violations or a litany of crimes related to theft and making false statements.
The agreement also requires companies to disclose any ongoing criminal investigations and, separately, any bankruptcy proceedings.
The disclosure requirements extend to I-77 Mobility Partners’ parent company, Cintra, as well as Cintra’s parent company, Ferrovial Agroman, as well as other Ferrovial Agroman subsidiaries.
To date, there is no evidence I-77 Mobility Partners has disclosed either of the fines imposed against Cespa.
Cintra owns or co-owns toll roads across the country.
Together with two affiliates of a large Australian investment bank, Cintra leased the Indiana Toll Road in 2006 through a subsidiary, ITR Concession.
ITR Concession filed for bankruptcy in September 2014 and another firm has since taken over operations of the road.
In its bankruptcy filing, ITR Concession said its toll revenues fell far short of its projects due to lower-than-expected traffic on the road.
To date, neither I-77 Mobility Partners nor NCDOT has been able to produce documentation showing the company disclosed the Indiana bankruptcy.
On Your Side Investigates verified many of the claims made in Gilroy’s letter about the fines imposed by Spanish regulators as well as the Indiana bankruptcy.
We sent our own detailed list of questions to both NCDOT and Cintra in hopes we could confirm whether or not the information had been disclosed as required by the contract.
Officials with both the North Carolina Department of Transportation and Cintra refused to provide specific answers in response to our questions.
In response to the eight detailed questioned posed by On Your Side Investigates to NCDOT spokeswoman Jordan-Ashley Baker, we received a two sentence response:
“NCDOT did receive a letter from Ms. Gilroy and in accordance with standard policy the Office of Inspector General is reviewing her claims. At this time, NCDOT believes that I-77 Mobility Partners and all affiliated companies accurately completed all forms and fully disclosed all items in the I-77 Express Lanes contract process.”
Similarly, On Your Side Investigates sent four detailed questions to a spokeswoman for I-77 Mobility Partners. A company executive also provided a two-sentence statement.
“The allegations of systematic corruption made by Ms. Diane Gilroy are absolutely and categorically false. Furthermore, we have fully complied with all of the various disclosure requirements throughout the multiple-year procurement process for the I-77 project,” Patrick Rhode, United States Vice President of Corporate Affairs for Ferrovial, said.
Neither NCDOT’s Baker nor Ferrovial’s Rhode provided additional information when we pointed out their statements did not answer our detailed questions.