Dredge-site firms eyed (raided by Fed Agents from Army, DOT, DOD)

KINGSTON – The offices of two firms connected to a dredge site in Hazleton were searched Tuesday by agents with several federal offices, including the U.S. Department of Defense.

More than a dozen agents spent several hours removing dozens of boxes of evidence from 580 Third Ave. in Kingston, which houses the offices of Fort Mifflin Reclamation Associates and Hazleton Creek Properties. The firms are involved in a project to transport dredged material, or sludge, from the Delaware River to a mine reclamation site in Hazleton.

The building is also home to Mark Realty Inc. and Mark Development Inc., which are owned by area businessman Marvin Slomowitz.

The agents declined to comment on what they were looking for, but a document reviewed by a reporter indicated the search is part of an investigation into a $19.2 million bid entered in August 2006 by Bowen Enterprises of Dunham Drive in Dunmore to remove 500,000 cubic yards of river sludge from the Delaware River that was stored at a naval shipyard near Fort Mifflin in Philadelphia.

The document said Bowen Enterprises, which is owned by Barry Bowen of Scranton, was not able to perform the work. The contract was instead awarded to Fort Mifflin Reclamation Associates, which was the next lowest bidder at $21 million, according to other documents obtained from the U.S. Army Corps of Engineers.

Bowen’s home on Oram Street in Scranton and Bowen Enterprises are also on a list of properties to be searched by federal authorities, according to the search warrant document.

A source with knowledge of the investigation, who spoke on condition of anonymity, said authorities are investigating whether there was collusion in the bidding process.

Slomowitz is the secretary for Fort Mifflin Reclamation Associates and the president and treasurer of Hazleton Creek Properties, which is the developer of a 277-acre mine reclamation site in Hazleton that has been pegged to house a 20,000- to 30,000-seat amphitheater.

Dredged material from the Fort Mifflin project was transported to Hazleton Creek Properties site, according to Sarah Rivette, a spokeswoman for the Corps of Engineers. The sludge was used to fill in strip mines on the property.

Bowen was the site manager for the Hazleton Creek Properties project as of December 2006. His withdrawal from the dredging project meant that companies connected to Slomowitz got both the contract to transport the sludge and to develop the site at which it was being deposited.

A second source, who also requested anonymity, said Bowen’s relationship with Hazleton Creek Properties, coupled with Bowen’s withdrawal from the bidding process, led a person to contact federal authorities to request an investigation into possible collusion.

The contract, awarded in September 2006, was initially for $21 million, but grew to $35 million, due in part to an increase in the amount of material, which nearly doubled in volume from the original contract, Rivette said.

Neither Bowen nor Slomowitz have been accused of any wrongdoing. Attorney Andrew Bigda, who represents Slomowitz, stood outside the Third Avenue offices as agents conducted the search. Bigda declined to answer any questions regarding the search.

Bowen did not return a message left at a number believed to be his home phone. Slomowitz also did not return a message left with a person who answered the phone at a home he owns in Florida.

The search was conducted by agents with several different agencies, including the U.S. Department of Transportation, the U.S. Army’s Criminal Investigation Organization and the Department of Defense, Office of Inspector General.

The Hazleton mine reclamation project has stirred significant controversy through the years due primarily to concern that the sludge might be contaminated with hazardous substances.

State Sen. Raphael Musto, whose offices were searched last week by the FBI, has been a strong supporter of the mine reclamation project.

Musto, D-Pittston Township, said Tuesday he has “no idea” why authorities searched the companies involved with the project, but he has no reason to believe the case is related to the investigation of him.

“I was a very strong supporter of the project and I still am,” Musto said. “Beyond that, choosing any contractor, that was not within my scope.”

Hazleton Mayor Louis Barletta, who has championed the reclamation project as an environmentally safe money maker for the city, said the city was not involved in the bidding process for the dredged material.

Hazleton Creek initially paid the city tipping fees when the dredged material was dumped at the reclamation site. But Barletta was informed by Hazleton Creek officials that there might not be enough dredged material to complete the project, so the city agreed to discontinue charging tipping fees and instead sell the land to Hazleton Creek Properties for about $3 million after having already received $750,000 in tipping fees.

Hazleton Creek paid the city $1.35 million so far and must pay the city another approximately $1.6 million during the next three years, and then a lesser amount annually until the land is paid for, Barletta said.

Although Barletta was familiar with Mark Development officials from previous development projects in the city through Mark Development, the mayor said he did not know Bowen until meeting him after he was hired as site manager of the reclamation site.

“I surely don’t want to speculate on what’s happening. … We need to wait and see if there was any wrongdoing. … I hope the reclamation of the minelands will continue and that the amphitheater project also will continue,” Barletta said.

Hazleton Dredge project Timeline
Five years ago, Hazleton Mayor Louis Barletta partnered with officials from Hazleton Creek Properties in a project he said would reclaim city-owned abandoned minelands, create new development and earn the city about $10 million in revenue during the course of five years.

The plan was to have trains haul 10 million cubic yards of sludge dredged from the bottoms of rivers and harbors in Philadelphia, New York and New Jersey to the city to fill strip-mine pits.

Hazleton Creek Properties – one of the Kingston businesses searched by federal authorities on Tuesday – was the developer in charge of the project.

The $10 million in revenue would come from tipping fees. It could be used to help pay for more police officers and road repairs, Barletta said.

The dredged material would be mixed with coal ash and other stabilizers before being used to fill in stripping pits and cap adjacent landfills.

Once the reclamation project was complete, a developer – Hazleton Creek Properties – would build an amphitheater that would seat up to 30,000 people. The hope is the project would entice others to build on the reclaimed land.

Here’s a timeline of significant events:

• March 2005 – Word leaks out that city officials plan to bring materials dredged from the Delaware River into the city to reclaim minelands, and state Rep. Todd Eachus, D-Butler Township, begins raising environmental and health concerns.

• May 10, 2005 – Barletta formally announces his plan to use dredged material to reclaim abandoned city-owned minelands, which in turn would spur development and line the city’s coffers with new revenue.

• Oct. 5, 2005 – The reclamation project is granted permit approval by the state Department of Environmental Protection to use a mixture of dredged materials, fly ash and stabilizing dusts to fill the stripping pits.

• Dec. 1, 2005 – An environmental group sues to stop the use of dredged materials.

• July 2006 – DEP approves permit for Hazleton Creek Properties to mix construction and demolition debris with dredged materials as fill.

• July 25, 2006 – U.S. Army Corps of Engineers advertises requests for bids on disposal of dredged materials from Fort Mifflin.

• Aug. 24, 2006 – Bids are opened.

• Sept. 20, 2006 – Bid is awarded to Hazleton Creek Properties.

• Dec. 14, 2006 – Trucks begin delivering dredged materials to the reclamation site.

• June 5, 2007 – Hazleton receives first $100,000 check for tipping fees from dredged material.

• July 2008 – Hazleton Creek Properties proposes buying city minelands.

• November 2008 – City sells the land to Hazleton Creek Properties for approximately $3 million.

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