The San Francisco Municipal Transportation Agency says a contractor working on the $1.6 billion Central Subway Project laid down more the wrong track. It turns out, the volumes of contract language are every bit as challenging as the complex work itself.
Work on the Central Subway continues toward a December 2019 opening. But SFMTA said it ordered and expected higher strength steel than it actually got. More than three miles of the lower grade steel rail was installed. SFMTA is demanding that the contractor, Tudor-Perini, replace the 17,000 feet of track with higher strength steel.
"The rail we specified within the contract could possibly last longer than the standard rail that was installed. This is not a safety issue. We're not concerned about operating trains safely because of improper rail. This is a situation where we want rail that's going to last as long as possible," said SFMTA Spokesman Paul Rose.
The City insists the contractor is a fault. "We do have independent auditors working with each contract and contractor to insure that everything is being done right. That's how it was found, an independent contractor noticed that the rail was the wrong grade and notified us," said Rose.
Ron Tudor, Tudor-Perini's CEO, told me emphatically that neither his company nor the sub-contractor that installed the track did anything wrong. He blames specification conflicts within the SFMTA's own paperwork. Tudor says the SFMTA inspected the track when it arrived, approved it, paid for it and oversaw its installation long ago.
Tudor also said the company will replace the rail as directed by the SFMTA and it will have no impact on delaying the already delayed project beyond the projected December 2019 completion date. However, Tudor says he will charge for the replacement track and expects payment. The City disagrees.
"There hasn't been a contract modification to change that specification. The standard grade rail was installed and we're asking them to remove that," said Rose.
Now that it's news, there will be a hearing by the Board of Supervisors. "I am now a co-sponsor of the hearing and we'll hear it on the committee which I chair, the Government Oversight Committee. We have to get ahold of these run away contracts and overruns and expenses," said San Francisco Board of Supervisors member Jane Kim.
This could be settled rather quickly if all the parties agree to binding mediation or arbitration, but it must be binding. Otherwise, it will end up in the courts and that will go on a lot longer than it will take to complete this project. And the taxpayers will surely foot the bill.