Airport Job Unlikely to Finish on Time, Grand Jury Reports

John Wayne Airport’s new passenger terminal is unlikely to be completed on time despite assurances from airport officials, mostly because of problems with one steel contractor, according to a report released Thursday by the Orange County Grand Jury.

But the jury also found that the county has sufficient financial resources to handle up to a 4-month delay in the opening date.

Former employees of Taylor Woodrow Construction California Ltd., the general contractor, warned last fall in memos to airport officials that the scheduled opening date had been jeopardized by late design modifications and other problems.

But airport officials continued Thursday to discount such warnings as normal “posturing” expected of general contractors on big projects. They also complained that the 1988-89 grand jury did not interview them for its report.

‘Four Months Behind’

After a 2-month investigation of the massive, $310-million airport expansion project, the grand jury found that: “It appears unlikely that the terminal will be completed by the currently planned date of April 1, 1990. . . . Current status reports by the contractor indicate that the project is 4 months behind schedule.”

The report, however, generally praises the performance of county officials and consultants managing the project.

The jury’s findings, prepared with the assistance of the Arthur Young consulting firm, are contained in a three-page letter to Board of Supervisors Chairman Thomas F. Riley, dated Jan. 18. The letter was not released until Thursday, when Riley’s written response was also made public.

Riley, in whose district the airport is located, defended the scheduled opening of April 1, 1990, as a “target” date and not a “drop-dead” date as “many have suggested.” Riley wrote Thursday, “At this point, the airport project management team reports that a substantial completion date of April 1, 1990, is attainable.”

Airport manager George Rebella has said that airlines must be able to use the new terminal within a month or two of that date because the county needs fees from the airlines and firms with concessions to begin paying off construction bonds.

Although the problem involving a steel contractor is not detailed in the jury’s report, officials told The Times that a Texas firm, believing that the county was desperate to keep the new terminal on schedule, proposed supplying steel for the project at a price that was to include $785,000 extra for work that it would not actually do.

The county broke off negotiations with the company on Jan. 11, according to county officials and airport documents.

The firm, Richmond Steel Inc. of Houston, insisted on being paid the extra $785,000--called “accelerated costs” in Richmond’s written proposal--even after airport officials warned that it would be “an illegal gift of public funds,” according to Richard Begley, project director at HPV, the consulting firm hired by the county to manage the airport expansion.

Advice Against Acceptance

Angry airport officials, concerned about the proposed transaction, referred the matter to Deputy County Counsel Daniel J. Didier, who advised against accepting Richmond Steel’s proposal.

Richmond Steel President Wayne Fuquay, who presented the proposal in person to Begley and other airport project officials about a month ago, has not returned The Times’ phone calls over a 2-week period.

Fuquay requested the extra $785,000 in accelerated costs--surcharges for a breakneck schedule--for steel columns that actually would be fabricated by Utah-based Stott Steel Inc. and Trinity Mosher Inc. of Houston, according to airport officials and a copy of Fuquay’s typewritten proposal. Fuquay refused to credit county payments to Stott and Trinity Mosher against the accelerated costs that he intended to charge the county for the same steel columns, Begley said.

Alan Murphy, the county’s airport project coordinator, said that Fuquay “thought he had us over a barrel” because of newspaper publicity about delays and cost overruns affecting the new passenger terminal.

County officials were dismayed last summer when the low bid for the terminal came in at nearly $59 million, $17 million over the county’s $42-million budget for the facility. The terminal was already behind schedule at that time because of late and incomplete designs that led to the architect’s forfeiting $775,000.

Now Stott Steel is expected to supply the steel needed for the project, but airport officials say they won’t know for about a week if steel placement, due to begin next month, can proceed quickly enough to make up for previous delays.

‘Naive on Jury’s Part’

Murphy denied speculation in the grand jury report that project managers have been too reluctant to change the schedule, fearing adverse publicity.

“That’s inaccurate. . . . Our statement would be that we think it’s a little naive on the grand jury’s part to accept the contractor’s viewpoint (about delays) when the contractor has a vested economic interest in making negative comments.”

In a memo to the airport staff, Begley echoed Murphy’s position and said he was never interviewed by Arthur Young or by grand jurors, even though he is the project director.

Taylor Woodrow faces stiff contract penalties if the project is not completed on schedule.

Murphy said he was surprised that the grand jury did not give him or Begley a chance to rebut Taylor Woodrow’s view of the construction schedule before the panel made its findings.

Chris Elliott, Taylor Woodrow’s project manager, previously referred all questions about the terminal schedule to HPV. He could not be reached for comment late Thursday.