MTA Facing Hard Choices on Subway : Transit: Agency must decide whether to keep using builder and management firm whose work was found deficient. Liability for needed repairs is unresolved.

After five months of waiting for outside specialists to render judgments on the quality of the construction and supervision of the $1.45-billion Los Angeles subway, the results are in. For members of the Metropolitan Transportation Authority, now comes the hard part.

The agency must decide whether to continue awarding lucrative contracts to a subway builder whose work was found deficient, and whether to entrust the supervision of future construction to a management firm that oversaw the defective work.

“The board clearly is troubled with going forward with the primary (construction) contractor involved in this matter,” said Marvin L. Holen, an MTA board member and Los Angeles attorney. He said the board is similarly concerned regarding the future role of the construction management firm.

One of two reports issued last week by outside specialists concluded that the tunnels were structurally safe, but recommended extensive repairs--including grouting to fill air voids in the concrete and sealing of deep cracks, some of which are conduits for corrosive water.

The other report said the company that oversaw the construction fell short of “acceptable industry practice” in seven key categories of performance.

The studies were conducted in response to a Times article reporting that numerous sections of the tunnel walls were built thinner than designed. The subway’s construction and costs remain under investigation by the FBI and the inspector general’s office of the U.S. Department of Transportation. State and county health authorities are conducting a separate inquiry of elevated levels in the subway of hydrogen sulfide, a toxic sulfur-smelling gas.

Now, the builder whose tunnel work was found deficient, Tutor-Saliba Corp., is the low bidder on $118 million in new contracts that could be jeopardized.

Parsons-Dillingham, the firm that oversaw Tutor-Saliba’s work, remains the MTA’s management firm for ongoing subway tunneling on Hollywood and Vermont boulevards.

Officials acknowledged that the continuing roles of the two companies complicate the difficult choices that the outside experts’ findings pose for the MTA.

First, there are the repairs. Who will pay for them? Who will perform and inspect the work?

MTA staff members are proposing to open the repair work to competition and to have it performed by someone other than Tutor-Saliba. Then, they said, the agency should seek remuneration from Tutor-Saliba and Parsons-Dillingham.

The recommendation has not yet been submitted to the board. But one official, Los Angeles City Councilman Zev Yaroslavsky, said: “This (repair work) is going to come at tremendous expense to the taxpayers--and they (Tutor-Saliba and Parsons-Dillingham) ought to pay for it.”

An estimate of the repair costs has not been made--and the MTA has yet to negotiate agreements with Parsons-Dillingham or Tutor-Saliba to pay for them.

Company President Ronald N. Tutor said he would agree to perform some repairs without charge--but he called “ludicrous” any proposal to bill him for someone else’s work.

“Why would anybody in their right mind consider using anybody else?” Tutor said. “I don’t think it would be appropriate to send me the bill if they haven’t given me the opportunity to do the work.”

The outside experts found defects in much of Tutor-Saliba’s construction of 1.8 miles of twin tunnels between Union Station and Pershing Square, including thin walls and air voids in the crowns of the structures. Tutor-Saliba was paid $89 million--45% over its original bid--to build the tunnels in question, plus part of the Civic Center station.

Richard Alatorre, the Los Angeles City Council member who is chairman of the MTA, said he would await more detailed analyses of the experts’ reports before deciding whether to challenge Tutor-Saliba’s hold on two of three new contracts for which the firm submitted the lowest bids.

When the first two contracts, totaling $73 million, were awarded in November, officials did so with the special condition that they could terminate the awards if the experts’ findings were critical of Tutor-Saliba.

In agreeing to those conditions, Tutor told the MTA board on Nov. 17 that he expected the experts “will give us the clean bill of health we’re entitled to.”

Last Wednesday, six MTA commissioners--one short of a majority--opposed awarding the third contract, for $45 million, to Tutor-Saliba. Further action on the contract, to build a station at Sunset Boulevard, was postponed until the agency’s meeting next month.

Alatorre voted in favor of awarding the contract to Tutor-Saliba. “I am disappointed in the work they did on the initial (tunnels),” he said in an interview. “It’s very disheartening. Do you eighty-six somebody? I don’t know.”

As for Parsons-Dillingham, the firm paid in excess of $170 million to oversee subway construction, representatives have pledged cooperation--but have stopped short of saying they will pay for repairs.

One report issued last week said that Parsons-Dillingham’s performance in overseeing two more recent construction contracts was improved.

“We’ll do our share to implement the recommendations from the reports,” said Ray W. Judson, special assistant to the chairman of Parsons Corp., parent of Parsons-Dillingham. “Our intention is to be part of the solution, and as such we will continue to cooperate with the MTA to the fullest extent to resolve these issues.”