When the Los Angeles County Metropolitan Transportation Authority announced that the second phase of the Westside’s Purple Line subway would be built by a joint venture led by the Tutor Perini Corporation, eyebrows were raised.
In the 1990s, the company then known as Tutor Saliba built the Red Line subway from MacArthur Park to Wilshire and Western. The project was plagued with controversy over costs and questions about too-thin concrete tunnel walls. In 1995, Tutor Saliba sued Metro for $16 million, and Metro countersued.
At one point, a judge threw out Tutor Saliba’s lawsuit when he learned the company had withheld and destroyed documents. A jury awarded $63 million to Metro, a decision overturned on appeal in 2005. Metro dropped its claim against Tutor Saliba in 2010.
The company merged with Perini Corp. and continues to do billions of dollars of work on public projects. Not all of them go smoothly. Problems with projects in Seattle and New York hit the company’s profits in 2015, leading two bond rating agencies to downgrade Tutor Perini’s credit rating from stable to negative.
But the Metro board voted 8-0, with L.A. Mayor Eric Garcetti and county supervisor Kathryn Barger not voting due to conflicts, to award the Purple Line contract to Tutor Perini. The company’s $1.37 billion bid was $500 million lower than its competitors.
A cynic might think the low bid is the first step on a well-worn road to cost overruns and litigation. Former County Supervisor and Metro board member Zev Yaroslavsky told the Los Angeles Times, “Metro has a long history with the Tutor company, and it’s a not a good one.”
Metro officials put out a statement promising “a strong oversight plan with experienced staff” to oversee the 2.6-mile project, which has a budget of $2.4 billion and is scheduled for completion by 2026. The federal government has agreed to provide a grant and a loan totaling $1.58 billion. The balance will come from county taxpayers thanks to Measure M, a permanent half-cent sales tax increase passed by voters in November.
Critics worried that a tax increase with no sunset clause would lead to reckless spending without accountability.
We’re not off to a reassuring start.
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