BRACEWELL owt fina OO &GIULIANI Comores” wazeeatoz once ‘Seato 60.286.610 Fax Dobal Kacakhsten evn ocomor@ngp.com London’ Bracewell & Gin LLP ‘Goodin Square 226 Asyan Skt Seta 2600 Hatiord, Connection 5103, October 22, 2010 Via Hand Delivery Jeffrey A. Parker Commissioner State of Connecticut Department of Transportation 2800 Berlin Turnpike Newington, CT 06111 Re: Project No. 92-531/622/627; New Haven Reconstruction of 1-95/1-91/Route 34 Interchange ‘Dear Commissioner Parker: As you are aware, our client, O&G Industries, Inc. ("0&G"), was informed on October 14, 2010 by the State of Connecticut Department of Transportation ("DOT") that the bid it submitted with its joint venture partner, Tutor Perini, was the low bid, by more than $22 million, on the above-referenced project (the "Project" or "Contract", Shortly thereafter, O&G was asked by DOT to attend a responsibility meeting on October 25, 2010 to discuss DOT's concers about O&G's role in the Project. Just yesterday O&G was also asked to produce a significant amount of information to DOT, As part of its response to those requests for production, O&G respectfully submits this letter and attachmenls to address some of DOT's concems, in particular, to set forth O&G's position regarding Conn. Gen, Stat. § 31-57b. Of particular noic, O&G recognizes and appreciates DOT's safety concems, particularly after the recent explosion at the Kleen Energy Project in Middletown, Connecticut and the resulting citations issued against O&G by the Occupational Safety and Health Administration ("OSHA"), While O&G, as is its right, is contesting the alleged conditions cited by OSHA, it has, consistent with its long-standing commitment to workplace safety, fully addressed and abated the alleged conditions and, therefore, addressed any safety concerns even though it is not yet obligated to have done so, Accordingly, as demonstrated below, DOT cannot, pursuant to Conn, Gen, Stat. § 31-57b, preclude O&G, as low bidder, from being awarded the Contract,Jeffrey A. Parker October 22, 2010 Page 2 L A CKGROUN! A. O&G's Successful History of Working with DOT (O8G is a local, family-owned construction firm founded in Torrington, Connecticut in 1923. Over its 87 years of operation, it has grown fo currently employ approximately 900 people and has become a leader in its industyy, It has enjoyed a long and productive relationship with DOT. Its work has always been of the highest quality and it has partnered with DOT over many years to successfully complete numerous large and complex projects. As the attached letter from retired DOT Deputy Commissioner Jim Rice demonstrates, in many cases, O&G has stepped in to help DOT complete projects when other contractors have defaulted. See Exhibit 1. Moreover, and perhaps most importantly, O&G has consistently dolivered its high quality work at a price much lower than its competitors, the above- referenced project being the latest example, which has led to millions of dollars in savings for DOF and Connecticut taxpayers, B, O&G's Long and Distinguished History of Promoting Workplace Safety O&G has a long-sianding and impressive track record of dedication and commitment to workplace safety. This is not a self-serving statement, As the attached Memorandum signed by the leaders of 17 local unions makes abundantly clear, O&G is "a quality contractor who shares our concer for the well-being of the union women and men the company employs." See Exhibit 2. Indeed, it is the unanimous opinion of these union leaders ~ all of whom have many members with extensive experience working on O&G job sites ~ that "O&G operates a quality safety program and has worked continuously to improve ‘workplace safety at its many construction sites, plants and locations.” Id. O&G's exemplary safety record has not only been recognized by those who work on its projects, but by the industry ~ repeatedly — as well, Indeed, O&G has received annual Safety Awards from the Associated General Contractors of Connecticut for 12 of the past 16 years. Moreover, O&G has, for every year since 1998, received recognition from the Connecticut Construction Industries Association for achieving Excellence in Construction Safety and Health, (0&G maintains a policy of continuous improvement in its safety practices. Through regular review of its programs, routine and frequent inspection of its worksites and perpetual improvement of its practices in line with best practices and emerging trends, O8&G strives to be at the foreftont of construction safety, O&G's most senior executives communicate directly with employees about the company's dedication to safety and the importance that the company places on the health andJefftey A. Parker October 22, 2010 Page 3 ‘well-being of every employee. O&G's Safety Department provides ongoing safety training ‘and instruction to all employees, including training on any changes in practices or programs resulting from its frequent safety audits. O&G regularly gives recognition to employees and projects that exemplify the company's commitment to safety. And, as part of its continuous safety improvement program, O&G has regular safety mechanisms that it employs on a daily, weekly, monthly, quarterly and annual basis, including job hazard analysis, training, site review, safety meetings and safety plan reviews, Every month, Safety and Human Resources personnel meet with senior executives in each division to review any safety-related incidents, to ensure that appropriate and adequate responses were made to each event, and to discuss and implement any program changes necessary to enhance safety and advance the company’s focus on safety. O&G also conducts an annual review and evaluation of its safety programs. This review culminates in an annual safety mecting for employees with safety responsibilities, filling a hall with foremen, superintendents, project engineers, project managers, safety professionals, support staff, and senior management, This event reinforces O&G's philosophy of a keen focus on safety at all of its project sites. O&G continues to increase the tools, resources and staffing level of its Safety Department. Outside safety consultants are being utilized to conduct additional onsite audits, including a review of safety documentation and procedures. O&G has taken the further step of increasing its safety capacity by cross training existing field staff. O&G utilizes an Environmental Department for compliance purposes, and these experienced individuals travel throughout O8&G's worksites inspecting for environmental concerns and improvements, 4G cross trains these individuals to serve as another resource to spot safety issues and report their findings to the Safely Department for follow up, C, The February 7, 2010 Kleen Bnergy Explosion and O&G's Response On February 7, 2010, an explosion occurred at the Kleen Energy Project Site in Middletown, Connecticut, The explosion, which tragically killed six workers and injured others, occured when vented natural gas used by a subcontractor to clean pipes was released into an open air courtyard and ignited by an unknown souree. O&G, the general contractor, had hired a specialized subcontractor to plan, execute and oversee the pipe cleaning process, The subcontractor’s duties included ensuring the safety and propriety of the pipe cleaning process, No federal workplace safety standard prohibits the use of natural gas blows to clean pipes. Moreover, according to a June 2010 study conducted by the Chemical Safety and Hazard investigation Board, as many as 63% of respondents from the Combined Cycle Users' Group, a power plant industry group, utilized gas blows to clean pipes,Jefltey A. Parker October 22, 2010 Page 4 ‘The tmgic accident of Febraery 7, 2010 represented a ue avomaly in terms of the Kleen Energy Project Site's safety performance.’ The site safety performance prior to February 7, 2010 was approximately 2.5 million man hours worked (total site hours) with 12 lost time injuries; this represents a lost time incident rate of .96, significantly below the national average for the construction industry.” Since the accident, more than 761,220 man hhours have becn logged at the site without a lost time incident, Consistent with its track recard of dedication to workplace safety and while, as is its right, contesting the allegations in the OSHA citations and civil suits filed against it, O&G has nevertheless taken definitive steps to ensure that this type of event eannot occur again. Tt cooperated fully with the investigations conducted in the Wake of the explosion by OSHA, the Chemical Safety Board, the Workforce Protections Subcommittee of the Education and Labor Committee of the U.S House of Representatives and the Nevas and Thomas Commissions appointed by the Governor of Connecticut. O8&G also voluntatily prohibited the use of natural gas blows to clean pipes at the Kleen Energy Project Site as well as at its other worksites Jong before the Governor issued an Executive Order banning the procedure. Notably, 026's prohibition on the use of natural ges to clean pipes also fully addresses over three quarters ofthe alleged conditions cited by OSHA. D. ‘The OSHA Investigation and Citations On August 3, 2010, after a six-month investigation with which O&G fully cooperated, OSHA issued citations in connection with inspection numbers 109179937 and 314295460 conducted at the Kleen Energy Project Site. Specifically, in connection with inspection 314295460, OSHA issued two citations to O&G, the first of which consisted of seven items characterized as "serious" and the second of which consisted of three items characterized as "other." In connection with inspection 109179937, OSHA issued two citations to O&G, the first of which consisted of fificen items characterized as "serious" and the second of which consisted of 117 items characterized as “willful.” Of note, over three quarters of the alleged OSHA violations arose from a subcontractor’s use of natural gas to clean and vent pipes and their execution of that process, a process O&G has addressed by prohibiting its future use ~ not just in Connecticut where it was subsequently prohibited by Executive Order, but at all ofits job sites, including those outside of Connecticut, Indeed, a week-long OSHA inspection of the Kleen Energy Project Site conducted prior to the explosion on February 7, 2010 resulted in O&G being deemed in full compliance ‘with all safety standards and regulations. * In 2008, the national average lost time incident rate was 1.7.