Rail car firm gets extension in MTA contract


An Italian company seeking a $300-million deal with the Metropolitan Transportation Authority won a victory Thursday when the agency’s board agreed to a two-month extension on the company’s expiring contract options to build 100 light-rail cars.

The two-month reprieve was advanced by Los Angeles Mayor Antonio Villaraigosa and supported by the Los Angeles County Federation of Labor, which filled the hearing room with more than 100 union workers wearing stickers that read “vote for jobs.”

As part of its campaign for the contract, AnsaldoBreda won union support by promising that -- if awarded the work -- it would build a plant with union labor in the Los Angeles area. Company representatives have begun negotiating with the Community Redevelopment Agency to lease a site downtown.


A number of MTA board members, including the mayor, said they wanted more time to vet the company’s performance under the initial contract to build 50 cars.

“We want to make sure that we’ve explored every possible option with respect to the opportunity to site a rail manufacturer here in the city of Los Angeles,” Villaraigosa said Thursday. “When you have a 12% unemployment rate, it’s incumbent on the public officials of this town to do everything we can to address it.”

Villaraigosa added that there were “real questions” about AnsaldoBreda’s compliance with its contract and the delays: “In the end, if we don’t have sufficient answers to those questions . . . that will weigh heavily on what we do.”

The 50th AnsaldoBreda light-rail car is scheduled to arrive three years late, and MTA officials say the passenger cars -- which cost $2.9 million each -- are 5,000 to 6,000 pounds heavier than specified in the contract. Officials say the cars also are incompatible with others in the MTA fleet. AnsaldoBreda officials dispute the weight calculations and contend the delays were caused by the transit agency’s demands for design changes, and agency officials acknowledge they granted a waiver on the requirement to make the cars compatible.

The board approved the two-month extension on a 10-1 vote. The “no” vote came from board member Mike Antonovich, a Los Angeles County supervisor, who said AnsaldoBreda had produced “inferior cars” and that the MTA could “do a competitive bid and get a better price.”

“It seems like we’re getting a stench of Chicago politics to have a continuation with an unreliable vendor,” Antonovich said. Another board member, Pam O’Connor, abstained from the vote -- stating that she was skeptical of the promises made by AnsaldoBreda.


In a statement after the vote, Fabio Ficano, AnsaldoBreda’s director of government affairs, said board members had done what was in the “best interest of the county.” Noting what he called the company’s legally binding commitment to locate a facility in Los Angeles and the company’s willingness to be penalized if it does not follow through, Ficano said AnsaldoBreda would work with the MTA “to hopefully address issues to their satisfaction and demonstrate the company’s willingness to put its money where its mouth is when it comes to Los Angeles.”

AnsaldoBreda has partnered with Shangri-La Construction to design an environmentally sustainable rail manufacturing plant, a $70-million project that they have said would be built with union labor. Shangri-La’s founder, Steve Bing, is a prominent donor to the mayor and other Democratic candidates.

Maria-Elena Durazo, executive-secretary of the Los Angeles County Federation of Labor and a friend of the mayor, told board members that they should raise the bar for public money used on transportation projects. “Here is an opportunity with AnsaldoBreda to come in, build a factory, make those light-rail cars here in L.A. County, where we have unemployment,” she said. “. . . . We want good jobs, we want green jobs, we want high-quality jobs.”