Airport Contractor May Face Huge Fines

Even as Orange County supervisors met behind closed doors Tuesday to debate firing the main contractor for the long-delayed John Wayne Airport terminal, the same firm could already face more than $1.6 million in fines for late work on an adjacent parking structure.

“They’re late on their completion right now, and that puts them in liquidated damages,” said one airport official who asked not to be identified. “They’ve submitted a request for an extension, which is being evaluated.”

Liquidated damages are penalties written into a contract to encourage timely completion of a project. Those penalties are contained in the parking garage contract as well as the one spelling out the terminal construction.

Beginning today, the contractor, Taylor Woodrow Construction California Ltd., could face fines of up to $25,000 a day for delays in completing the terminal work, the centerpiece in a $310-million expansion project to ease congestion at Orange County’s largest commercial airport. The terminal was originally scheduled to be finished in February, but now is not expected to open until Sept. 15 at the earliest.

According to several officials, Taylor Woodrow was supposed to complete work on the garage and a connecting roadway in mid-September of last year.

However, work there is still under way, which means that those elements of the airport expansion are more than eight months late. The contract provides for a $10,000-a-day late penalty. At an average of 20 working days per month, that could bring the fines to more than $1.6 million.

The parking garage dispute fuels an already tense situation between the county and Taylor Woodrow. With construction already behind schedule on the terminal, some county officials are growing increasingly irritated with the contractor and are lobbying for its removal from the project.

That option was among several being discussed by the supervisors during closed-door sessions with county lawyers Tuesday, officials said.

Chris Elliott, project manager for Taylor Woodrow, declined to comment on the parking garage except to confirm that “you’ve got your facts right. There is a debate between us and the (county’s) project manager over the parking structure.”

Under the contract, the parking structure is supposed to contain 1,611 spaces, and Taylor Woodrow is being paid $25 million to build it and the roadway. Taylor Woodrow’s terminal contract is valued at $60 million.

Although they concede that the parking structure is late, Taylor Woodrow officials have filed for an extension with the consulting group that was hired by the county to oversee all aspects of the airport expansion. That group, known as HPV, is reviewing the extension requests, according to several officials.

No final determination has been made on whether to grant the extension, officials said. John McCarney, project manager for HPV, was unavailable for comment.

Although the parking structure was said to be among the issues on the table for discussion by the supervisors Tuesday, board members for the most part were unavailable for comment or reluctant to spell out details.

Asked whether the issue of potential fines for the parking structure was raised, Board Chairman Don R. Roth said: “All aspects of the project are being discussed, and the whole thing is under possible litigation. We’re not going to talk about it today.”