Blue Line Agency Taps Subway Builder for Contract.

When San Gabriel Valley-area lawmakers met back in the mid-1990s to push for construction of a light rail line from downtown L.A. to Pasadena, they were so frustrated by the delays and controversy surrounding the Metropolitan Transportation Authority's subway project that they decided to create a separate construction authority.

Which is why it's more than a little ironic that the Los Angeles-to-Pasadena Blue Line Construction Authority last week chose as its main contractor a team led by Kiewit Pacific Co.

Kiewit was on the joint-venture team for the MTA's Red Line subway project that ran into massive troubles five years ago, when tunneling on the Hollywood segment of the project created a huge sinkhole. In short, the authority has hired one of the companies that in part prompted the frustrations that led to its own creation.

What's more, the runner-up in the selection process was a team led by Sylmar-based Tutor-Saliba Corp., which took over as the main contractor on the MTA Red Line after the Hollywood sinkhole debacle. Tutor-Saliba has had its own run-ins with the MTA that included a protracted court battle and allegations of serious safety violations.

So how did an agency created to distance the Pasadena light rail project from the MTA end up selecting contractors who were so closely tied to some of the MTA's most serious subway construction troubles?

Simply put, when it came time to solicit bids for the estimated $300 million contract, the Blue Line Construction Authority found that there was no escaping the MTA. That's because the field of contractors able to take on construction of a major light rail line is quite small. Each of the five teams of finalists had at some time or another done work for the MTA.

Not a lot of choices

"It's not as big a world as most people think," said Los Angeles City Councilman Mike Hernandez, who is also chair of the Blue Line Construction Authority board. "There are just a few firms out there that join in partnerships and do all the major transportation construction work across the country."

What's more, Hernandez said, the field of qualified companies was smaller this time around than it might have been because of the good economy. Many large engineering and construction firms have their hands full and simply could not take on another major project that must be completed by mid-2003.

Despite the small pool of bidders, Blue Line Construction Authority officials say they are more than satisfied with the quality of the winning team, which is a joint venture of Kiewit Pacific and Washington Group International Inc. (formed after the acquisition of financially troubled Morrison Knudsen Corp. and Raytheon Co.'s construction business).

The Kiewit team submitted a $260-million bid to design and build most of the 13.7-mile light rail line from Union Station to East Pasadena, going through Chinatown, Lincoln Heights, Highland Park and South Pasadena. The contract does not include a half-mile-long aerial portion of the track through Chinatown, nor does it include the purchase of the steel rails, which the authority is purchasing on its own.

The total cost of the Los Angeles-to-Pasadena Blue Line project is pegged at $439 million, excluding work done on the project by the MTA before the separate authority was created two years ago.

Blue Line Construction Authority officials say they examined both the safety and performance records of all the bidders in great detail during a two-stage process that began last February. At times, there were up to 20 staffers working on these examinations, they said.

"We looked at all their past projects, and not just on a cursory basis," said Tom Stone, chief project officer for the authority. "For example, we went to all the contracting authorities on those past projects and had those contracting authorities fill out confidential evaluation forms on the work that these companies did. In my 30 years in this business, it was the most thorough evaluation I've been involved with."

Authority staff gave the Kiewit-Washington team the highest safety rating and the second-highest performance history rating. Furthermore, Kiewit-Washington came in with a bid of $267 million, $30 million lower than the runner-up's bid. In the overall scoring, price accounts for half and the performance ratings count for the other half.

Due diligence 

Stone said authority officials interviewed MTA officials and attorneys representing many of the MTA's constituent jurisdictions in regard to Kiewit's involvement with the Red Line sinkhole problems along Hollywood Boulevard.

"We found that the work in question that was found to have led to the difficulties was not performed by Kiewit, but by the lead company on the team, J.F. Shea Co. We also found that Kiewit had not been disqualified from future MTA projects," Stone said.

He added that a similar process was used to evaluate Tutor-Saliba's MTA work.

"We had the MTA and various attorneys evaluate Tutor-Saliba's major contracts with that agency and we found again that Tutor-Saliba had never been disqualified," Stone said.

The staff evaluation was enough for Blue Line Construction Authority board vice chair and South Pasadena City Councilman David Saeta.

"We had 20 evaluators working on this and I was very impressed with their work," Saeta said. "In this situation, fortunately, the team with the highest qualifications rating also had the lowest cost."