More than $15 million in payments for Sandy cleanup work are being withheld from Looks Great Services by Nassau County, the towns of Hempstead and Huntington and the Long Island Rail Road over disputes ranging from insurance liability to payment of state-mandated prevailing wages.
A lawsuit filed Tuesday by the Huntington-based firm in Nassau County Supreme Court alleges the combined overdue amount -- $15.6 million -- for work completed months ago has left the company short of funds, unable to pay some of its subcontractors and unable to respond to requests to work following tornadoes in Oklahoma.
Most of the money, $13.8 million, is owed by Nassau, the suit claims, noting the county sought further indemnity protection after a 35-vehicle wreck on the Long Island Expressway in December involving a Looks Great subcontractor's truck.
County Attorney John Ciampoli said Wednesday he was surprised to hear of the suit after negotiations last week resulted in the county paying Looks Great $12 million. That brought to $47 million the amount the firm has received from Nassau for Sandy cleanup.
"I thought we were well on the way to settling any disagreements between Looks Great and the county and quite frankly I'm amazed this is their way of saying thank you," he said, adding that county attempts to contact Looks Great's Manhattan lawyers were unsuccessful Wednesday.
Ciampoli, who had yet to see the lawsuit, said county officials had a duty to first protect the interests of Nassau taxpayers.
The county was reviewing in conjunction with Looks Great's Atlanta-based law firm a range of claims made by residents who believed they had incurred damage while Looks Great was performing work, but there were also claims against the county resulting from the LIE crash that the county has yet to resolve with the firm, he said.
The Town of Hempstead and the LIRR have withheld $887,234 and $136,990, respectively, citing prevailing wage issues and investigations into Sandy contracts. Hempstead has paid Looks Great $3.97 million for Sandy work, town spokesman Mike Deery said.
"Payments have not been made by the town because questions have arisen as to whether the company paid prevailing wages to its employees for this work," he said.
The Nassau and Suffolk county district attorneys, the state attorney general's office, the state Department of Labor and the federal Department of Labor are all investigating Sandy contracts over prevailing wages and how the contracts were awarded.
Looks Great has argued that its emergency debris removal did not require prevailing wage rates. The lawsuit states that all Sandy work performed under the firm's service agreement "is emergency debris removal and not public works" and that "public works requirements do not apply to these emergency debris removal contracts."
The state Labor Department requires contractors and subcontractors to pay prevailing wages and benefits to construction workers under a public works contract, using rates set for the locality where the work is performed.
The department has said prevailing wages do apply in emergencies unless exemptions are granted. No such waivers or exemptions arose during Sandy, officials have said.
The Town of Huntington has paid Looks Great $7.3 million for Sandy work. Remaining payments of $781,000 have been withheld pending the provision of additional paperwork from the firm, town spokesman A.J. Carter said Wednesday. With Celeste Hadrick