Plan to Award $80-Million MTA Contract Scuttled


The top executive of the Metropolitan Transportation Authority has scuttled plans to award an estimated $80-million management contract to a firm whose supervision of earlier subway construction was found deficient.

Chief Executive Officer Franklin E. White announced his decision in a letter made public Thursday to appointees of the MTA’s governing board. An MTA spokesman said new proposals to manage construction of subway extensions to the Eastside and the Mid-City would probably be solicited in the next two months.

White’s decision comes as a rebuff to the agency’s rail construction staff. After soliciting proposals in April, 1993, the staff this spring had ranked the firm of Parsons-Dillingham No. 1 among competitors for the new contract, according to people familiar with the matter.

The staff’s ranking came despite a critical report in February by outside specialists retained by the MTA. The specialists, who assessed the construction and management of the 4.4-mile Red Line subway, found that numerous segments of the tunnels were built with concrete that was thinner than specified.


They concluded that Parsons-Dillingham fell short of “acceptable industry practice” in seven areas of performance--including its inspection of construction. Parsons-Dillingham “certainly intends” to continue seeking the construction management contract in a new round of competition, said Ron Wildermuth, director of corporate relations for the firm’s parent, the Pasadena-based Parsons Corp.

Parsons-Dillingham has agreed to pay the MTA $1.4 million for the earlier studies and to inspect, at no charge, recommended repairs now under way by the original contractor to tunnels linking Union Station and Pershing Square. Parsons-Dillingham and its partners have been paid more than $200 million to oversee subway construction.

White, in his letter to MTA board members, referred to the specialists’ findings and noted that high concentrations of a toxic gas were recently confirmed in the path of some of the new subway construction.

“All of these matters have resulted in a significant time delay,” White wrote, noting that proposals for the new management contract were sought more than a year ago. ". . .We intend to re-procure the construction management services contract.”


The new management contract, worth an estimated $80 million, involves part of what is to be the third segment of the subway. The first 4.4 miles link Union Station and MacArthur Park. The next leg, to be opened by 1998, extends to Wilshire Boulevard and Western Avenue and north along Vermont Avenue to Hollywood Boulevard. The third segment, perhaps to open by 2000, would extend east from Union Station to Indiana Avenue and west to the vicinity of San Vicente and Rimpau boulevards.