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Contractor Islip hired for Sandy cleanup convicted in 2004 of overbilling Brookhaven

At the Riverhead Court House, Stephen Milvid arrived

At the Riverhead Court House, Stephen Milvid arrived for sentencing for his role in a Brookhaven bribery trial. (Dec. 15, 2004) Credit: Daniel Goodrich

Islip Town hired a contractor for Sandy cleanup work who had been convicted of overbilling Brookhaven tens of thousands of dollars, making illegal campaign contributions to a town official, falsifying business records and failing to pay workers state-mandated wages.

The 2004 convictions of Medford-based Debut Concrete and its president, Stephen Milvid, included grand larceny and carried a five-year ban on the firm bidding for, or being awarded, any public work contracts in New York under state labor law.

In 2002, the year Milvid was arrested, the Suffolk County attorney ordered the county Department of Public Works not to use Debut Concrete and the firm has received no public work from the county since, spokeswoman Vanessa Baird-Streeter said.

Debut Concrete was among 24 contractors Islip hired after the Oct. 29 storm to help with cleanup operations at a cost of $7.67 million, as of April 12. Debut was paid $78,716.31, the town said. The firm had first worked for the town at its Department of Public Works yard in Holbrook earlier in October and was paid about $26,000.

The office of Suffolk District Attorney Thomas Spota, which prosecuted the 2004 case, has issued Islip three subpoenas requiring the town to supply records of Sandy contractors, what they and their workers were paid, and how they were selected. Four other Suffolk towns and the county also have been subpoenaed.

In Nassau, District Attorney Kathleen Rice is investigating Sandy cleanup contracts, whether they were properly awarded, and whether workers were paid in accordance with state labor law.

Milvid did not return calls seeking comment.

DPW officials made picks

The town late Friday said public works staff and management picked the 24 Sandy contractors. Earlier, Islip said 21 of them had previously worked for the town, and the remaining three, including Debut Concrete, solicited the town's public works department for work.

Under New York State Executive Law, once the governor has declared a state of emergency, town supervisors and county executives can make local state of emergency declarations that temporarily suspend local laws — such as competitive bidding requirements — or any other regulations that could hinder storm response. Under nonemergency circumstance, local governments have to seek bids or requests for proposal if contract work exceeds certain spending thresholds spelled out in state law.

Islip Supervisor Tom Croci declared an emergency Oct. 27, just before the storm struck.

Asked about the selection of the firm, two of the five Islip Town Board members said they were unaware of Debut Concrete, the convictions, or of Milvid.

"I'm not B.S.-ing you," Councilman Steven J. Flotteron said. "It's the first time I've heard of it. I don't know who they are." He said he was concerned that the town hired a contractor convicted of felonies in a municipal corruption case.

Councilwoman Trish Bergin Weichbrodt said: "That company — I've never heard of them." She said the first time she learned which contractors the town used for Sandy cleanup was in April, shortly after hearing the Suffolk district attorney had subpoenaed town records. She said she had never heard of Milvid.

Councilmen John C. Cochrane Jr. and Anthony S. Senft Jr. did not return phone calls for comment. Croci declined to be interviewed.

Tried with ex-official

He went on trial with former Brookhaven Highway Superintendent Pat Strebel, who was charged with overpaying Milvid on town work in exchange for $12,000 in contributions to her political campaign in 2001 and 2002 while she was in that job.

Suffolk County Court Judge Gary Weber, who presided over the trial without a jury, convicted Milvid of 35 felonies and 14 misdemeanors. He was sentenced to 90 days in jail, ordered to repay Brookhaven $72,186 for the overbillings, pay almost $100,000 in fines to New York State and pay a settlement of around $250,000 to his workers.

Strebel was originally charged with 36 felony counts relating to her role in the scheme. She was convicted of 31 misdemeanors and received a $2,500 fine.

After the trial, Spota lashed out at Weber, saying his acquittal of Strebel on the felony charges was "clearly a political verdict."

Thomas Owens, Brookhaven deputy highway superintendent under Strebel, was a prosecution witness.

Focus on hiring

In his first round of hirings after winning election in November 2011, Supervisor-elect Croci named Owens as his Department of Public Works commissioner. While Islip declined to immediately make public documents showing how Debut Concrete and the other Sandy contractors were selected, Bergin Weichbrodt said in an interview that Owens was in charge of selecting storm contractors.

The Sandy cleanup was not the first time Islip used Debut Concrete. Town spokeswoman Inez Birbiglia said Islip hired Debut in early October 2012 to do "roughly $26,000" in concrete work at the Holbrook facility. She said that work was performed satisfactorily, and the town then hired Debut for Sandy cleanup. She said the firm had the necessary equipment and was committed to the work for the duration of the cleanup.

In emailed responses, Birbiglia said the town "is prohibited from excluding vendors based on a criminal history unless it relates directly to the contract."

Calls to Owens were not returned, and Birbiglia declined to make him available for an interview.

According to a list supplied by the town, Islip paid the 24 contractors $7.67 million as of April 12. It paid Debut Concrete $78,716.31. The town has declined to immediately provide invoices for the work done. Newsday has sought the information under the New York State Freedom of Information Law.

Federal records show the town had claimed $12.7 million in debris removal costs arising from Sandy as of early April, for which FEMA had agreed to reimburse $9.5 million.

Town Attorney Rob Cicale said the difference is largely the cost of town materials, equipment and staff, which are also eligible for FEMA reimbursement.

No to contributions

After checking his records, Islip GOP chairman Frank Tantone said late Friday he found Debut Concrete purchased two tickets totaling $300 for an April 2012 GOP fundraiser. There were no others, and he said he would return the money.

"We're going to strike them from our mailing list in terms of potential contributors," he said. "Now that we know what we know .?.?. rather than getting involved in a situation where there might be questions, we think it's proper to take that course."

In an interview, Tantone said he knew nothing about the company, nor how or why the town picked the firm for cleanup work. He said he played no role in the selection of the contractors and said he did not know why the town has been subpoenaed by the district attorney's office.

While on Dec. 22, 2011, Tantone said he sat in on most interviews with prospective town employees, he said last week he had no role in the selection of Owens.

Stephen Milvid's convictions

The felonies include

Grand larceny for overbilling Brookhaven more than $72,000

Multiple counts of falsifying business records for false invoices he supplied the town for the overbilling

Multiple counts of offering a false instrument for filing for false payment vouchers he submitted to the town

Scheme to defraud

Among the misdemeanors

Multiple counts of willful failure to pay prevailing wages under New York State Labor Law, which at the time was a misdemeanor but has since become a felony

Making political contributions in excess of the applicable limit, a violation of state Election Law

Making political contributions not under name of the contributor

Source: Court records

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