MOUNT CARMEL - Bad news for residents living along Shamokin Creek: The flood control project will, once again, be delayed.

David R. Grey, project coordinator of community development with SEDA-Council of Governments (SEDA-COG), informed Mount Carmel Borough Council Thursday night that the state Department of General Services (DGS), which is in charge of the project, rejected all bids for the Shamokin Creek Flood Control Project because the winning bid did not comply with Section 3, a provision of the U.S. Housing and Urban Development (HUD) Act of 1968.

The Section 3 program requires recipients of certain HUD financial assistance, to the greatest extent feasible, provide job training, employment and contracting opportunities for low- or very-low income residents in connection with projects and activities in their neighborhoods.

Paperwork glitch

Because the borough used HUD funding in the form of CDBG money, it is subject to Section 3, which requires promotion of economic opportunities to very low- and low-income individuals on public projects. The provision is intended to foster local economic development, neighborhood economic improvement and individual self-sufficiency, according to HUD.

DGS met with the state Department of Community and Economic Development (DCED) to ensure the bid process for the project complied with Section 3 requirements, and DCED supplied DGS with documentation to be included in the bid documents, Grey said. However, DGS moved forward, and the bids were opened in July.

A formal bid protest was filed by one of the bidders, who stated the low bidder was not responsible since that bidder did not comply with Section 3.

Grey said Section 3 does not require contractors to create new positions, but if there is a need for additional staff, the contract must hire Section 3 residents within the project area.

Unfortunately, said Grey, the low bidder did not provide the proper documentation saying the firm would not need additional employees, and all the bids were rejected.

"At this time, we do not know how much this will delay the project," Grey said.

Sen. John R. Gordner (R-27) said the re-bid process will be shortened since the issue was only with one component of the bids.

However, he could not provide a time frame.

Out of borough's hands

Officials have up to 60 days from the time the bid is opened to award it; the contractor who receives the bid has another 60 days to sign off on the project.

The project, which is expected to alleviate flooding of properties along Shamokin Creek, is no stranger to hold-ups; it has taken three decades to make it this far.

Borough Mayor J. Kevin Jones said the project's delay is not because of the borough.

"This is a project from the state. We didn't make this error here," he said Thursday night.

The borough's obligations included acquiring rights to land around the creek and consolidating deeds and signing them over to Department of General Services (DGS). At that point, DGS was responsible for the entirety of the project.

Grey said there would be no further expenses incurred by the borough and the fault does not lie with council.

"At the moment, the next step is to wait for DGS to re-bid the project. This process is entirely out of the control of the borough and its officials," he said.