Toll Officials, Lockheed OK ‘Divorce’ Terms

County toll road authorities have agreed to a $5.5-million, out-of-court settlement with their estranged chief contractor, which announced this summer it was pulling out of its contract to operate the county’s network of tollways because the deal was a money loser.

At a special meeting of the Transportation Corridor Agencies on Thursday, directors overwhelmingly agreed to a settlement that is roughly $6 million less than what Lockheed Martin IMS initially demanded in compensation.

Agency directors also agreed to a Dec. 31 deadline for Lockheed to clear out of its Irvine offices, which they share with the TCA. Lockheed had two years left on its contract.

After discussing the deal in closed session for almost two hours, toll officials said the payment would help avoid a costly and protracted court battle.

“Who wants a headache?” said Orange County Supervisor Todd Spitzer, a TCA negotiator.

The action follows months of open squabbling, tense negotiations and a growing frustration with some tollway motorists who feel they are being mistakenly billed for toll violations. Under a 1993 agreement, Lockheed had overseen and collected tolls on all 52 miles of the Foothill, Eastern and San Joaquin Hills toll roads.

TCA officials said the root of the trouble is that Lockheed’s heart just isn’t in the job, for which they earn as much as $15 million a year. Tollway officials said they hope to stem the grumbling before it permanently sours motorists on the tollways and already have three suitors--Chase Manhattan Bank, TransCore Inc. and Experian Information Solutions Inc.--interested in the job.

For their part, Lockheed Martin officials denied claims of customer dissatisfaction and said they were doing everything they could to ensure a smooth transition.

When discussing the board’s action Thursday, negotiators used family law terms--”irreconcilable differences,” for one--to describe the dispute. “If you said this sounds like a divorce, you’d be right,” said Mission Viejo Councilwoman Susan Withrow, another TCA negotiator.

While tensions had been building for more than a year, the rift became public in June when Lockheed Martin announced it was severing its contract with TCA. The contractor claimed its expenses had exceeded revenue by roughly $50 million. Although the company claimed low toll-revenue projections were to blame, TCA officials said that was not true, insisting revenue has actually exceeded projections by almost $4 million over the past three years.

Despite the settlement agreement, some TCA officials insist Lockheed owes the agency money because it has been lax in tracking down toll violators.

TCA negotiators still must settle one key issue--how to operate Lockheed Martin’s computer software. Still, tollway negotiators said Thursday’s actions represented a solid step forward in the separation.

“Our customers are not going to feel anything in the transition,” Spitzer said.