Convention center bid-rigging scandal: Mortenson agrees to $1.3M settlement that includes work on coronavirus project

Mortenson Construction’s settlement of bid-rigging claims on the large Denver convention center expansion project includes a $650,000 payment to the state and an unorthodox component aimed at helping in coronavirus pandemic.

State investigators’ first major resolution in the city’s bidding scandal, announced Monday by Colorado Attorney General Phil Weiser, includes an agreement that the company will donate its construction services on a yet-to-be-determined project related to COVID-19. That is the highly infectious respiratory illness caused by the virus, which has been flooding hospitals with patients, resulting in plans for temporary field hospitals — including inside the Colorado Convention Center.

Mortenson’s donated work and materials must be worth at least the same amount as the fine, making the antitrust settlement’s value at least $1.3 million.

The city halted its planned $233 million rooftop expansion project at the Colorado Convention Center in December 2018 when Denver Mayor Michael Hancock announced officials had fired project manager Trammell Crow. He cited the discovery of evidence that Trammell Crow had shared project-related information improperly with Mortenson, one of three bidders.

Minneapolis-based Mortenson long had denied the allegations but acknowledged Monday that it fell short.

“While we have resolved the Colorado Convention Center matter with the Colorado attorney general without adjudication or finding of liability, our involvement in this matter was neither consistent with who we are as a company nor our longstanding reputation,” president and CEO Dan Johnson said. “Simply put, we did not meet our own expectations.”

The company previously agreed in a separate city settlement in July that it would not bid on any city projects until at least March 2021, but the attorney general’s office continued with criminal and civil investigations. The investigation of Trammell Crow is still underway, Weiser’s office said.

“The communications between Mortenson and Trammell Crow were improper and gave Mortenson an unfair advantage in the competitive bidding process,” Weiser said in a news release Monday. “Today’s announcement shows we will hold accountable those companies and individuals that undermine the competitive bidding process when they bid for public construction projects and put millions of taxpayer dollars at risk.

“The silver lining is Coloradans will benefit from additional resources to respond to needs we have from the COVID-19 pandemic in our state.”

Denver’s Department of Transportation and Infrastructure restarted the bid process on the long-delayed convention center project last year.

Work is already underway on the field hospital at the convention center. Lawrence Pacheco, a spokesperson for Weiser’s office, said Mortenson would work on a different project. The settlement agreement says the Denver metro area will be given site preference, and “Mortenson shall pay all its own costs of service and any other construction costs incurred, including but not limited to building materials and any subcontractors and design services.”

The settlement, first reported by Colorado Public Radio, requires the Mortenson employees involved in the convention center bid to work actively on the COVID-19 project. Those include senior vice president Maja Rosenquist, who oversees Mortenson’s Denver office, and Gene Hodge, the company’s vice president and general manager.

They also face ethics-related mandates, including making presentations to college classes about lessons learned and to a large construction industry conference about ethics and antitrust compliance issues on public projects.

Mortenson also must create an antitrust compliance program for its Colorado operation, the settlement says, and it must increase its outreach to miniority- and women-owned firms to join its bids for public projects. The state’s news release says Mortenson’s conduct on the Denver bid “potentially harmed” less-established competitors.

Hancock praised that component and expressed gratitude to Weiser’s office for its handling of the probe.

“The integrity of our procurement process is critical to ensuring the public’s trust,” the mayor said. “When companies attempt to circumvent that trust, it’s in the people’s interest that they be held accountable.”

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