Purple Line contractors say they will leave the job because of delays, no cost relief

Purple Line contractors say they will leave the job because of delays, no cost relief

Construction companies expected to quit within 60 to 90 days

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Logo from Purple Line Transit Partners

The construction firms building the Purple Line are planning to leave the $2 billion project after the state refused to pay for “extensive delays” and added costs, according to a letter written Friday by the project’s manager, Scott Risley.

The Purple Line, about 16 miles of light rail line under construction, is planned to extend from Bethesda to New Carrollton in Prince George’s County. It will connect to several Metrorail lines in Bethesda, Silver Spring, College Park and New Carrollton.

The companies, which are partnered under Purple Line Transit Constructors, include Fluor, Lane Construction Corp. and Traylor Bros. They are expected to leave the project within the next 60 to 90 days.

Risley’s letter, sent to the companies’ umbrella group, Purple Line Transit Partners, stated that they have attempted to work with the Maryland Transit Administration (MTA) for almost three years to resolve disputes.

After six months of “intense” negotiations, PLTC and MTA came to an “agreement in principle on a settlement of certain issues” in December, Risley wrote. MTA has refused to move forward with that deal and instead proposed a revised deal that added disputed issues and placed additional cost and risk to the firms, he wrote.

“PLTC and its member companies should not be required to finance the hundreds of millions of dollars in added costs for issues that are out of its control, not of its making …,” Risley wrote.

More than 970 days of project work were affected by delays caused by the MTA, he wrote, which included third-party lawsuits, delayed right-of-way acquisition, and changes to regulations and third-party agreements after the project started.

According to a PLTC statement released Friday, the companies’ contract has an exit clause which allows them to leave the project if the total delays reach 365 days.

Purple Line Transit Partners could not be immediately reached on Friday.

In an emailed statement, the Maryland Department of Transportation wrote that the project has experienced delays “in conjunction with litigation” since the project started in 2016.

Purple Line Transit Partners and Maryland DOT’s MTA “have been actively engaged in discussions to mitigate the impacts of litigation and change order requests on both the project schedule and cost,” the department wrote.

The department wrote that it would not comment further, but it was committed to continuing negotiations and completing the project.

Montgomery County Council Vice President Tom Hucker, who chairs the council’s Transportation and Environment committee, told Bethesda Beat on Friday that he was surprised that the companies planned to leave the job.

But he wasn’t surprised about negotiations deteriorating with the state’s transportation department.

“I hope that it’s a tactic and expression by them to want to be heard by MTA and want to get this resolved quickly, so they can go back to work,” he said. “It’s certainly our desire that … they return to work and get the project done as quickly as possible without any delays.”

Hucker said the county is familiar with the difficulty in negotiating with MDOT, which can be “obstinate and not collaborative when they want to be.”

Hucker said that shortly after Gov. Larry Hogan was elected, the governor was not entirely supportive of the project and cut back on the project to take away some amenities, such as public art installations and green tracks.

“Certainly, our hope is that [Hogan] will do what it takes to keep the project moving forward,” he said. “There has been far too much drama in this project. There has been too many delays and cost overruns.”

Residents and businesses in the community are depending on the Purple Line being finished in a timely manner and have made decisions to buy homes, enter leases and sign loans based on the existence of the project, Hucker said.

“If they pull up the stakes now and allow the design-build firms to walk away and allow further delays, it imperils all these other decisions that people have made,” he said.

For the last three years, firms have worked to resolve four issues of delays and cost overruns, and offered to complete the project “at cost with no profit,” Risley wrote.

“Without being granted the contractual relief to which it is entitled, PLTC would be forced to absorb hundreds of millions of dollars in additional costs that are MTA’s responsibility,” he wrote. “This is neither reasonable nor sustainable for PLTC.”

The Washington Post reported on April 15 that the companies said an additional five months and $187.7 million were needed to build a required “crash wall” along the light-rail tracks. It would cause an additional delay of 506 days and possibly increase cost overruns to $526 million, which would be more than 25% over budget.

The companies will meet with PLTP within the next two days to finalize a transition plan for the project work, according to the letter.

Council Member Evan Glass, who serves on the Transportation and Environment committee as well, wrote in an emailed statement that he has consistently raised concern with the added delays and $300 million in projected cost overruns.

“My hope is that this transition will not add to an already lengthy construction schedule, but will provide a true accounting of the state of this project and its costs,” he wrote. “Now is the time for the state to fully inform the public about the status and cost of this project.”

Hucker said he expects everyone will know relatively soon whether the firms’ announcement was a negotiation tactic.

“The commitments have been made [by the state] and they need to do what it takes to keep the project moving forward,” Hucker said. “They need to just get the job done.”

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

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