2020 | Transit

UPDATED: Purple Line contractors, state reach $250M settlement agreement

Public-private partnership moving forward with two of three initial partners

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This story was updated at 7:53 p.m. on Nov. 24, 2020, to include additional background on the Purple Line project.

The Purple Line feud between the state and the project’s contractors might have finally come to an end with a $250 million agreement to settle all disputed claims and litigation over cost overruns and project delays.

The state announced the settlement with Meridiam, Star America and Fluor on Tuesday afternoon in a press release. The agreement settles all “outstanding financial claims and terminates the current litigation between the parties” on the $2 billion project, according to the release. The state Board of Public Works still has to sign off on the settlement.

The end of the litigation followed months of negotiations between the state and the project’s contractors over claims of the project’s cost overruns and delays. The design-build contractors, Purple Line Transit Constructors (PLTC), first notified the project’s consortium, Purple Line Transit Partners (PLTP), that it would leave the job on May 1 because of the disputes.

In its notification to PLTP about leaving the project, PLTC wrote that it had attempted to work with the Maryland Transit Administration (MTA) for almost three years to resolve disputes. The design-build contractors also said in May that more than 970 days of project work were affected by delays caused by the MTA.

The public-private partnership project will proceed with Meridiam and Start America as developers and equity partners. Fluor will not be proceeding with the project and was the only contractor of the three companies which was under PLTC, which brought the complaints.

A spokeswoman for PLTC did not immediately respond to a request for comment on Tuesday.

On Sept. 10, a Baltimore City Circuit Court Judge ruled that the contractors could abandon the project after a temporary restraining order was granted through MTA’s lawsuit — filed in August — to keep the workers on the job through Sept. 14.

The formal settlement agreement is expected to go before the Board of Public Works (BPW) in December to be reviewed and approved.

“With this progress in negotiations, the parties have agreed to put all pending claims and litigation on hold pending BPW review of the settlement agreement,” the release stated.

Gov. Larry Hogan said in the release that the agreement is a major step forward to completing the 16-mile light rail system that is planned to have 21 stations between Bethesda and New Carrollton.

“I would like to thank [Transportation Secretary] Greg Slater and our partners at Meridiam and Star America for coming together to find a path forward that will lead to a new contractor,” Hogan said in the release.

A new design-build contractor would be solicited by Meridiam and Star America if the BPW approves the agreement.

“The months of challenging but always good faith negotiations, led by Secretary Slater, have paved the way for an agreement that will allow the project to move ahead,” Jane Garvey, chair of Meridiam North America and chair of the Purple Line Transit Partners Board, said in the release.

Current work on the Purple Line includes light rail car manufacturing, bridge work, stormwater drainage, paving, and utility and pump station construction.

Slater said in the release and he and Garvey spoke every day during negotiations on the project.

“When you are trying to solve complex issues, collaboration is the key,” he said in the release. “In big projects like this, there are challenges you will encounter, and it takes a good partnership to work together productively on solutions.”

This story will be updated.

Briana Adhikusuma can be reached at briana.adhikusuma@bethesdamagazine.com.