Pena Tells MTA Board to Halt Meddling

Seeking to protect a multimillion-dollar federal investment, U.S. Transportation Secretary Federico Pena told Los Angeles MTA board members Monday that they must adopt a “code of conduct” to end their meddling in day-to-day operations and quickly complete a plan for building the subway.

Yet even as the unusual private meeting in Washington took place, turmoil continued at the Metropolitan Transportation Authority in Los Angeles with the surprise resignation of the agency’s construction chief. Stanley Phernambucq, who oversaw subway and light-rail construction, cited “the dysfunctional relationship that exists between and among board members and our public works program.”

Phernambucq accused aides of two board members of attempting to influence contract awards and complained that the entire board had made a game of humiliating his staff in public. The resignation came two weeks after Joseph E. Drew, the MTA’s chief executive officer, announced that he will leave his job in January because of similar concerns.

In Washington, Pena told the MTA board to deliver a plan to federal officials by Jan. 15 for extending the subway to the Eastside and North Hollywood as close to the current budgets and completion dates as possible, according to participants. He asked that local officials also decide how they want to proceed with the long-delayed proposed subway extension to the Mid-City area.

“We asked the board to reaffirm its commitment to the Red Line [subway] project as its first priority,” Federal Transit Administrator Gordon J. Linton said in an interview after the meeting, which he attended.

MTA officials have been talking about slowing down subway construction or studying whether it would be cheaper and faster to build aboveground rail lines because of a projected $1-billion shortfall in the county’s long-range transportation plan. The federal government is paying for about half of the $5.9-billion project, but Congress has slashed its appropriations for the last two years.

Linton said the MTA can consider building aboveground rail lines instead of a subway if it wishes. But he warned that the move would probably delay completion of the projects even more and increase costs.

“They’re going to have some very tough decisions,” Linton said about the board. “But their ability to make those tough decisions . . . will determine our ability to put forth a good face on their projects for the coming [federal] budget.”

Yvonne Brathwaite Burke, a county supervisor and MTA board member who attended the session, said Pena stressed that the government wanted to see a return on its already substantial investment. “They feel that the project has to go forward,” she said. “They said this is the largest project in the nation, and it’s very important that it not have a black eye, and that we put it back on track.”

Burke, MTA Board Chairman Larry Zarian and two other board members met with Pena and other federal officials in the transportation secretary’s conference room, while Mayor Richard Riordan, an MTA board member, participated by speakerphone from Los Angeles. Linton described the meeting as a “frank and productive exchange.”

Zarian said that the agency would comply with Pena’s requests. “They just felt we’re sending the wrong message to Congress,” Zarian said. “We need to show a new face.”

Carol Schatz, a downtown business leader who was appointed to the MTA by Riordan, said the federal officials were supportive. “They clearly want us to succeed,” she said after the meeting, which she also attended.

On Wednesday, the MTA board is scheduled to consider shifting $300 million from other transit projects and cutting its budget by 5% in order to make up for the shortfall in federal funding and to help keep the tunneling on schedule.

But the agency may have to make other cuts as well, possibly shifting money from the $803-million construction of the Blue Line trolley from Los Angeles to Pasadena. That notion is strongly opposed by Supervisor Mike Antonovich, an MTA board member and longtime opponent of underground construction.

“If Washington is telling us to scrap the Blue Line for a failed subway, then Congress needs to educate the executive branch about the cost-effectiveness of an aboveground system,” Antonovich said.

Pena would not comment, but those at the meeting said he warned the officials that they must quickly square away their plans for the subway to win support from Congress before another year’s worth of funds is allocated for transit projects.

Federal officials sought five actions from board members:

* Adoption of a “code of conduct” that, according to Linton, “lays out the appropriate role and behavior of board members as they deal with their oversight responsibility.” Noting that the political infighting was blamed for the resignation of the MTA’s second chief executive officer in less than four years, Linton said the code should be approved quickly so the MTA can get a CEO “of the quality that they need.”

* Development of a plan showing how the MTA will complete a subway segment from Hollywood to the east San Fernando Valley on time and at budget.

* Development of a plan to help make up for delays and hold down costs on the extension of the subway to the Eastside. The extension, from Union Station to 1st and Lorena streets, is already a year behind schedule. Linton noted that a contingency fund has already been used up, even though construction has not begun. Tunneling is scheduled to begin next year.

* Prepare a plan to show how a subway extension to the Mid-City can be built within existing fiscal constraints. The project is already several years behind schedule. A number of board members have raised doubts about whether the agency can afford to build the extension. The cost of the segment from Wilshire Boulevard and Western Avenue to Pico and San Vicente boulevards has increased by $160 million over the original $490 million estimate.

* Provide a more realistic long-range plan.

Meanwhile at MTA headquarters, Phernambucq surprised the agency with a bitter parting shot after serving as construction chief for 1 1/2 years. In January, he said, he will become president of Luster Construction Management in Los Angeles, a small consulting firm that has supervised building at hospitals and airports.

In an interview with The Times, the former Army Corps of Engineers colonel said he was quitting out of frustration with a board that had attempted to interfere with contracts, humiliated his staff and taken no pride in its product. He said that just two board members had ever visited the tunnel construction sites they frequently complained about, few “celebrated our victories” by appearing at subway segment openings, and none credited staffers with making numerous improvements in rail construction safety and quality.

“In public meetings they will look at you like you’re the witness to a crime and treat you like you’re never capable of doing anything right--it made our guys feel like hell,” he said. “We call it playing ‘Stump the Chump.’ You can ask anyone a bunch of questions and sooner or later they’ll get one wrong. Well, I was tired of playing the chump.”

Phernambucq said staff members of MTA board members Antonovich and Gloria Molina had attempted to meddle in contract procurements.

The construction chief said Molina’s chief legislative aide, Gerry Hertzberg, had asked him in the early summer to put a particular engineer on the panel that was hired to help choose a business team to supervise tunneling on the Eastside. “I thought that was improper,” Phernambucq said. “We eventually disqualified the engineer because he had a conflict of interest.”

Hertzberg decried the accusation as “mudslinging,” contending that he proposed the agency hire a “credible, tough, impartial” engineer that the city of Los Angeles had previously used. “This wasn’t an attempt to meddle, it was an attempt to secure the integrity of the process,” Hertzberg said.

On another contract, Phernambucq said, Antonovich aide Habib Balian “wanted me to do some things and I said I would consider them. Well, I considered them and immediately decided I could not do it.”

Balian said he could not recall such a conversation. Antonovich said his aide “only asked for everyone to get fair access” to contracts. “I’m not surprised they are using slander to cover up their mistakes,” Antonovich said.

County Supervisor Zev Yaroslavsky, an MTA board member, said he respected Phernambucq’s honesty and hard work. Drew called Phernambucq a “remarkable, competent” man who was not liked by contractors because he was “tough and fair.”