MTA Contractors Dispense Thousands in Political Gifts : Subway: A ban has been proposed on donations to members of new oversight panel, but it has met resistance.

At the Metropolitan Transportation Authority, where billions of dollars in contracts are parceled out, the influence of political contributions is an ever-present undercurrent.

Lobbyists--more of them are registered at the MTA than at the state Capitol--blanket the agency’s meetings. And, records show, companies that do business with the MTA have donated hundreds of thousands of dollars to a handful of elected officials who oversee the nation’s most expensive subway project.

Now, as the MTA reorganizes to correct serious construction and management deficiencies, officials also are wrestling with whether to impose greater separation between the campaign contributions of contractors and the public policy decisions of transit board members who have received those contributions.

On Oct. 26, with little discussion, the board overwhelmingly rejected a proposal that would have barred them from accepting any contributions from MTA contractors.

They did unanimously pass a proposal that prohibits members of the board who will serve on the agency’s new construction contract award committee from accepting campaign money from contractors.

That committee is replacing the MTA’s recently dissolved Rail Construction Corp., which oversaw subway construction and awarded contracts, subject to MTA board approval. The RCC had been criticized for being too closely aligned with contractors.

The ban on contributions was proposed to insulate members of the new construction oversight committee from contractors who give political gifts.

“This is going to give us an opportunity to show that we’re voting for the taxpayer, not the special interest,” MTA board member James Cragin said after his reform measure passed.

But Cragin’s proposal is now meeting resistance. Other board members have referred it to the county counsel for further legal analysis, and Cragin fears the proposal will be “studied” and maneuvered to its death.

“People don’t want to tighten things up. . . . It’s going to cut off their flow of money for elections,” Cragin said. “They like it the way it was--where it was real loose and you could play games.”

The chairman of the MTA, county Supervisor Mike Antonovich, said he is withholding judgment regarding the fate of Cragin’s proposal until the legal analysis is completed.

Los Angeles City Councilman Richard Alatorre, an MTA board member who has objected to aspects of Cragin’s proposal, said the public is adequately protected by existing laws requiring disclosure of campaign donations.

Alatorre also suggested that many MTA board members would rather continue to accept contributions from contractors than take a seat on the new construction committee. “What happens if we don’t have people who want to serve on the committee?” he asked.

Over the last decade, a handful of elected officials who continue to serve on the MTA board have accepted more than $500,000 in campaign contributions from construction contractors, engineers, lawyers, lobbyists and other firms doing business on the Downtown subway project, records show. And those totals do not include the board’s past members, such as former Mayor Tom Bradley, who alone collected more than $45,000 from Metro Rail contractors.

Some contractors also have contributed to a favorite tax-exempt charity of Alatorre.

MTA board members oversee a panoply of decisions that affect the contractors. In addition to awarding contracts, the board members evaluate contractors’ requests for extra payments and play a role in enforcing standards covering construction quality, minority hiring and safety.

What, if anything, can contractors expect when they contribute to the campaigns of MTA board members?

“There is no question that people that are on your (contributor) list, you invite them to more things,” said County Supervisor Yvonne Brathwaite Burke, who serves on the MTA board. “And they do have more of a chance to get their ideas over to you.”

*

As agency officials are confronting the role that campaign contributions play, they also are seeking to restore confidence in the MTA. This fall, after ground subsidence occurred above subway tunnels in Hollywood, the federal government questioned the competence of the MTA’s construction management and froze $1.6 billion in funding until organizational changes were promised.

Records show that Los Angeles city and county officials serving on the 13-member MTA board have gotten by far the most campaign money from transit contractors, with County Supervisor Deane Dana and Mayor Richard Riordan receiving the largest amounts. In addition to the five county supervisors, the MTA board is composed of Riordan, three appointees of the mayor and four representatives from outlying cities.

State law prohibits board members from voting on any contract award that was not competitively bid or on regulatory matters affecting a donor who has given $250 or more within the previous 12 months.

This routinely causes some MTA board members to abstain from voting on certain contract awards. After the one-year period has passed, other members have repeatedly voted in support of the positions favored by their contributors.

A limitation of the existing law was demonstrated in November when Riordan, despite having received nearly $10,000 in 1993 from employees of a consulting firm he wanted the MTA to hire, found a way to participate legally in a contract award.

After determining that only a single, $500 contribution from a partner of the firm was made in the preceding 12 months, the mayor announced his solution.

“What we’ve done,” Riordan told a transit committee meeting, “is we’ve returned $251 of (the $500 contribution)--so that I guess I don’t have a conflict. Is that right?”

“That’s correct,” responded a county transit lawyer.

The next week, Riordan helped award a $500,000 contract to the consultant, Arthur Andersen & Co., whose price was higher than five other competitors. The firm is to evaluate the MTA’s construction management and make recommendations for how it can best be reorganized.

A spokeswoman for Riordan, who declined to be interviewed, said campaign contributions do not affect the mayor’s decisions. “His criteria for those decisions is what’s in the best interest of the citizens who live here and the businesses that are doing business here,” press secretary Noelia Rodriguez said.

Other elected officials say that contributions do not guide their votes, either. “If you take a contribution from someone with business in front of you, you’ve got to be strong enough to be able to say no to them,” said Los Angeles County Supervisor Zev Yaroslavsky, who from 1987 through 1993 accepted at least $44,000 from rail contractors. “If you can’t say no--don’t take it.”

But some who serve on the MTA board said they believe campaign contributions generally have helped contractors.

“It has to--sure it has an impact,” said Marvin L. Holen, a lawyer who has served on the board of the MTA and its predecessor agencies over the last 20 years. “It provides access.”

Said Cragin, who as a member of the Gardena City Council has not accepted Metro Rail-related campaign contributions, “I think that (campaign money) influences a director’s vote.”

One former transit official, noting that hundreds of millions of dollars of engineering services contracts are awarded on the basis of “qualifications” instead of sealed competitive bids, said campaign contributions can make a difference in the awarding of those contracts.

“There is a wheeling-dealing atmosphere . . . where campaign contributions may have a significant bearing,” said James Pott, a professional engineer who left the Rail Construction Corp. board in 1992.

Alatorre, who has received $36,500 in contributions from more than a dozen rail contractors, said that the money does not influence his actions.

“I want to make it real clear--whether someone gives me money or not, (it) doesn’t put me in a compromising position,” Alatorre said. “I can vote against them as easily as I can vote for them. My reputation is more important than that.”

Six months ago, while Alatorre was still chairman of the MTA, companies holding rail contracts supported a golf tournament staged for his campaign fund.

One subcontractor who contributed money for the event said in an interview that smaller firms, too, are strongly encouraged to donate by the prime contractors who hire them.

“If I’m going after work with the MTA, they expect me to give to Alatorre and others on that board,” said the subcontractor, who spoke on condition of anonymity out of fear of retaliation.

Alatorre confirmed that some rail contractors also have contributed to a favorite nonprofit charity of his, the El Sereno Youth Center. The group’s first major fund-raiser was a dinner two years ago honoring Alatorre at the Biltmore Hotel.

Lou Moret, a former aide to Alatorre and a founding director of the youth center, said that currying favor with Alatorre is not “the overriding reason” contractors paid to attend. “People write checks because they believe in the cause,” Moret said. “And the cause is a very noble one.”

Most contractors contacted by The Times declined to discuss their reasons for making campaign contributions to MTA board members.

“We have a really strict, standard policy that we don’t discuss campaign contributions,” said Debra Lambeck, vice president and general counsel for the Daniel, Mann, Johnson & Mendenhall engineering firm.

Michael L. Shank, a Denver-based contractor whose joint venture built subway tunnels now in service between Pershing Square and MacArthur Park, said he believes political influence counts in Los Angeles. Shank said he suspects that it can affect the enforcement of construction quality requirements and the outcome of requests for contract increases.

“I’m convinced it’s not a level playing field in L.A.,” said Shank, who refused to make campaign contributions and said he no longer will bid on transit projects here. “Unless you have some influence, it’s suicide to go in there.”

Another firm, CRSS Constructors Inc., which last year won a contract to help manage construction of an $850-million above-ground rail line from Downtown to Pasadena, indicated that contributions cannot be avoided.

“Our political system puts significant financial campaign pressure on those seeking office,” a spokesman for CRSS said. “As long as this pressure exists, campaign contributions will be part of the (MTA contracting) environment.”

Records show that over the last decade, the three construction-related contractors who have won the greatest value in contracts also have contributed the most money to politicians on the MTA board. Each company has become embroiled in problems that have fallen under the purview of board members who received donations.

* Tutor-Saliba Corp. The Sylmar-based firm has contributed more than $62,000 to current MTA board members and has won, through competitive bids and contract amendments, more than $500 million worth of work.

Although sealed, competitive bids typically leave MTA board members with little discretionary authority, the board has exercised latitude with a number of contractors.

For instance, Tutor-Saliba was in jeopardy of losing $73 million worth of station construction contracts in late 1993 after The Times reported deficiencies in the firm’s building of Downtown subway tunnels.

After lengthy debate, MTA board members deadlocked and could not muster the votes to award the contracts. But staff warned that a delay would be costly, and Tutor-Saliba’s president urged the board to withhold judgment of his firm’s earlier work until specialists reported their findings.

The board approved an extraordinary compromise: Tutor-Saliba was awarded the new contracts--on condition that the MTA board could terminate the pacts after reviewing the specialists’ findings. When those findings were reported in February, Tutor-Saliba agreed to make extensive repairs. No MTA board member has suggested reconsidering the award of the station-construction contracts.

More recently, Tutor-Saliba was rejected as the low bidder on a new $70-million station construction contract after the MTA’s chief executive officer, Franklin E. White, alleged that the firm had listed an improperly certified minority subcontractor.

At the MTA’s Oct. 26 meeting, White’s authority to block the contract was challenged unsuccessfully by Supervisor Dana’s appointee to the MTA board, Robert Arthur.

During the meeting, Dana’s chief of staff, Donald R. Knabe, privately complained to a county lawyer who had advised the board that White was empowered to reject all bids.

“We (Dana’s office) were a little bit concerned . . . that the final decision rested in the hands of the CEO,” Arthur said. “The low bidder, Ron Tutor, met all the qualifications for good faith.”

Arthur said he was aware that Tutor was a major contributor to Dana’s campaigns, but did not discuss the matter with the contractor. He said that he and Dana have abstained in many other instances to avoid even the “suspicion of an impropriety.”

Ronald N. Tutor, president of Tutor-Saliba, has said he donated to Dana because he thought he was a good supervisor. But he said this month that he would cease.

“We’re not contributing to anybody on that board anymore,” Tutor said. “Nothing. Nada. So I won’t be part of those stories anymore.”

The Times reported in December, 1992, that Knabe and another Dana aide, acting as the supervisor’s appointees to the transit board, had cast 29 votes approving $45.8 million in contract increases for Tutor-Saliba. This prompted a state law that prohibits appointees of elected officials from granting contracts to campaign contributors.

* Parsons Brinckerhoff. The New York-based company leads a consortium of design-engineering firms that have donated more than $36,000 to MTA members. The group has won about $300 million worth of contracts, awarded at the discretion of transit board members.

In a matter being watched closely by the MTA, the chief tunnel engineer that Parsons Brinckerhoff has assigned to the Los Angeles subway project is under scrutiny by a state licensing agency for engineers.

The engineer, Timothy P. Smirnoff, is not licensed to practice civil engineering in California. He was one of two officials who approved the substitution of wooden wedges, instead of metal struts, for bracing of tunnels along a stretch of Hollywood Boulevard that has sunk.

Based in part on the results of the state’s inquiry into the Hollywood tunneling problems and Smirnoff’s licensing status, White said he will determine whether to seek remuneration from Parsons Brinckerhoff.

Company officials have said that Smirnoff did not need a California license because his work has been overseen by a state-licensed engineer.

Parsons Brinckerhoff Chairman Martin Rubin said contributions generally do not influence how MTA members vote on a particular project. “The thing that I object to is the inference there’s something dirty about political contributions,” he said in an interview.

* Parsons Corp. The company, which controls Parsons-Dillingham, the MTA’s subway inspection management firm, has contributed about $25,000 directly and through its employees and has received contracts worth more than $260 million.

For more than a year, Parsons-Dillingham has been at the center of controversies regarding deficient construction of subway tunnels Downtown and, more recently, along Vermont Avenue and Hollywood Boulevard.

An independent review for the MTA concluded that Parsons-Dillingham fell short of “acceptable industry practice” in its supervision of the work Downtown, where numerous sections of Tutor-Saliba’s tunnels were built with concrete thinner than designed.

White has expressed outrage that Parsons-Dillingham inspectors also allowed a different tunneling contractor to excavate along Vermont and Hollywood without placing a high-strength grout material around the wooden wedges, as required.

Parsons-Dillingham has defended its inspections and in a letter to the MTA accused the contractor, Shea-Kiewit-Kenny, of deliberately concealing the deficient work from inspectors.

The performance of Parsons-Dillingham also is being reviewed by the state engineering board. A Parsons-Dillingham “resident engineer,” the second official who approved the substitution of wooden wedges is not licensed by the state.

Representatives of Parsons-Dillingham have said that he did not need a license because he has not practiced civil engineering.

Although White has voiced displeasure, MTA board members have not moved either to terminate Parsons-Dillingham or to block the firm from seeking new Metro Rail contracts.

Asked why the company has contributed to the campaigns of MTA board members, a spokesman for Parsons Corp., based in Pasadena, issued this statement:

”. . . We support candidates at all levels of government throughout the nation. Parsons believes that businesses and individual citizens should exercise their right to participate in the political process.”

Times editorial researcher Cecilia Rasmussen contributed to this story.

Deep Background

* A collection of articles on the ongoing problems faced by the Metro Rail subway project can be found on the TimesLink on-line service.

Details on Times electronic services, A4

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The Money Tunnel

These are the 10 biggest political contributors to current Metropolitan Transportation Authority board members among those contractors, engineers, law firms and other companies that do work with the Downtown subway project. (The totals include not only contributions made by the firms themselves but also donations from partners and other employees of those companies.)

CONTRIBUTOR: Riordan & McKinzie*

PROJECT ROLE: Legal counsel

TOTAL: $113,280

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Mayor Richard Riordan

*

CONTRIBUTOR: Tutor-Saliba

PROJECT ROLE: Heavy construction

TOTAL: $62,700

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Deane Dana

*

CONTRIBUTOR: Parsons Brinckerhoff

PROJECT ROLE: Engineering

TOTAL: $35,952

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Deane Dana

*

CONTRIBUTOR: Parsons Corp.

PROJECT ROLE: Engineering/mgmt.

TOTAL: $25,090

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Mike Antonovich

*

CONTRIBUTOR: John F. Shea Co.

PROJECT ROLE: Heavy construction

TOTAL: $19,520

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Deane Dana

*

CONTRIBUTOR: Mannatt, Phelps & Phillips

PROJECT ROLE: Legal counsel

TOTAL: $19,478

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Zev Yaroslavsky

*

CONTRIBUTOR: Daniel, Mann, Johnson & Mendenhall

PROJECT ROLE: Engineering

TOTAL: $18,655

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Deane Dana

*

CONTRIBUTOR: Jenkins Gales & Martinez

PROJECT ROLE: Engineering

TOTAL: $17,993

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Yvonne Burke

*

CONTRIBUTOR: Arthur K. Snyder Inc.

PROJECT ROLE: Lobbying

TOTAL: $11,875

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Mayor Richard Riordan

*

CONTRIBUTOR: Fluor Corp.

PROJECT ROLE: Engineering

TOTAL: $9,903

BIGGEST RECIPIENT ON CURRENT MTA BOARD: Supervisor Mike Antonovich

* This does not include several million dollars in contributions that Riordan, a former partner in the law firm, made to his own mayoral campaign.

Source: Campaign records and Los Angeles City Ethics Commission