High-speed rail board member wants more info about project contractor

The Fresno BeeMay 2, 2013 

A train travels through a wind farm in an illustration from the California High-Speed Rail Authority.

NEWLANDS AND COMPANY INC.

— At least one member of the California High-Speed Rail Authority board wants to know more about the prospective construction contractor for the first stretch in Fresno and Madera before he votes to award a contract next month.

At the agency's meeting Thursday in Sacramento, board member Jim Hartnett of Redwood City took note of a "significant difference" between the technical scores of the two lowest bidders for the 29-mile route.

A consortium comprising the Sylmar-based Tutor Perini corporation, Zachry Construction of Texas and Parsons Corp. of Pasadena submitted the low bid of under $1 billion, but also had the lowest technical ranking.

Tutor Perini/Zachry/Parsons received a technical score of 20.55 out of a possible 30 points in an evaluation before the prices of any of the five bidding construction teams were revealed. The second-lowest bid -- $1.1 billion from a joint venture of Dragados SA of Spain; Samsung C&T America, a subsidiary of South Korean multinational Samsung Group; and Pulice Construction Inc. of Arizona -- received a technical score of 26.13 points out of 30.

"What I want to hear more about is the technical qualifications," Hartnett told his colleagues. "Despite what would appear on the surface to be a significant difference between the first- and second-place bidders, does that reflect a true significant difference in the ability of the lowest-dollar bidder to deliver what's promised?"

Hartnett added that he and his colleagues "need to be given assurances as a board that what we've set up and what we're getting is what we're promised. I think that's part of our responsibility."

Hartnett's question went unanswered Thursday. After the meeting, he said it was not his intention to have answers on the spot, but instead to let the authority's staff know what his expectation is before the board is asked in June to award a contract to Tutor Perini/Zachry/Parsons.

Hartnett said he'll be looking for specific information about each of the companies in the Tutor Perini/Zachry/Parsons team, and which company will be responsible for various parts of designing and building the Fresno-Madera segment. "I want to know more about the evaluation of their prior design-build projects or experience so that we can be assured that they've been through this, how they've fared in other projects."

His comments came after several members of the public took the authority to task for changes to the bid-evaluation process last fall. When the agency announced it was seeking bids in March 2012, the process called for a two-part screening in which all of the bids would be analyzed for technical merit; only the three highest-scoring technical bids would move on to the second phase, opening their cost proposals. In August, the agency amended the evaluation process to allow all bids passing the technical muster -- and not just the top three -- to move on to the price competition. That revised process was the basis on which five teams of contracting firms prepared their bids.

Shelli Andranigian, of Kings County's grassroots opposition group Citizens for California High-Speed Rail Accountability, said the change "watered down" the technical evaluation. Andranigian's family also farms in Fresno and Kings counties near the proposed rail route south of Fresno.

She said she expressed concerns as early as October 2011 about "a possible derailment, which would be catastrophic considering our close proximity."

"By considering the selection of the least technically sound construction firm, the authority board is making this possibility an almost certain reality," Andranigian said.

Officials with the rail authority defended the changes to the bidding process as "improvements" that increased the competition among the would-be construction teams. Authority CEO Jeff Morales said the modifications to the bidding criteria were among more than 1,000 amendments made over the course of 10 months before contractors submitted their bids in January.

In March 2011, the rail board adopted the two-step evaluation process, including the provision that only the three bidders with the highest technical scores would compete on price. The same vote also authorized the agency CEO to make non-substantive changes to the request for proposals, in consultation with board chairman Dan Richard.

But Richard, who once worked as a consultant for Parsons Corp., has excused himself from the entire bidding process, from the request for proposals through the prospective contract award in June. Richard designated board member Michael Rossi to consult with the authority's staff, "not because board approval was required, but to address those issues staff believed should come to the attention of the board," Morales said. Morales added that his staff did consult with Rossi on a range of issues, including extending the bidding deadline to the changes in how the bids would be evaluated.

"I am somewhat befuddled, I admit, that we seem to have concern about an outcome that produced greater competition and better prices," Morales said Thursday.

Other action

The rail board also voted to extend several contracts with consultants, including firms handling the environmental and planning work on the Los Angeles-San Diego, Sacramento-Merced, Merced-Fresno and Palmdale-Los Angeles sections of the statewide system. The extensions come without increasing the contracted price to be paid to any of the regional consultants. Each of the contracts was set to expire on June 30.

The board's votes tack up to 90 days onto the authority's contracts with HNTB for Los Angeles-San Diego and with AECOM for Sacramento-Merced, and add 15 months onto a contract with Hatch Mott McDonald and other associated firms for Palmdale-Los Angeles. During the extension period, the authority will begin the process of seeking new bids for consulting work on those regional sections.

A contract with AECOM for its Merced-Fresno work was extended through June 2015.

Parsons Brinckerhoff, the international consulting firm that is handling overall statewide project management for the rail authority, won a two-year extension worth up to $95 million. Parsons Brinckerhoff -- a different company from Parsons Corp., which is part of the low-bidding team for the Fresno-Madera construction contract -- was hired in 2006 by the rail authority with a seven-year deal worth up to $199 million. So far, about $160 million has been spent under that contract.

But the extension was accompanied by sharp words from authority board members, who cautioned Parsons Brinckerhoff on overstepping its bounds.

When the firm was first hired, the authority was operating with a skeletal staff and required help from consultants just to accomplish its day-to-day work. Now, the authority has filled many of its senior and rank-and-file positions, reducing its reliance on consultants for management chores.

"It is important for PB to know ... that the times have changed," board vice chairwoman Lynn Schenk said. "I was here in 2006 when we first did the contract, and through the ensuing years I very often had the feeling that PB ... felt that they were the authority and we were routinely ignored and dismissed."

"I understand and acknowledge the need for continuity," Schenk added, "but I would not hesitate to go out to rebid should the relationship not continue as we all here hope that it will now on this new basis."

The reporter can be reached at (559) 441-6319, tsheehan@fresnobee.com or @tsheehan on Twitter.

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