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The Maryland Department of Transportation has reached a $250 million settlement with the three companies with whom it contracted to build the Purple Line in Prince George’s and Montgomery counties.
The deal, announced Tuesday, clears the way for two of the firms — Meridiam and Star America — to retain their involvement on the 16-mile light rail project.
The third firm, Fluor, will no longer be part of the consortium that has been known up until now as Purple Line Transit Partners.
The agreement is the result of months of feverish negotiations between the state and PLTP. The $5.6 billion deal that the state signed with the consortium in 2016 cratered in September over an estimated $800 million in cost overruns, a battle that ended up in court.
“This agreement is a major step toward completing the Purple Line, a transformative project for our state and the region,” Gov. Larry Hogan said in a statement.
“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. We continue to make progress on all of the highest priority transportation projects across Maryland.”
The agreement is subject to approval by the Board of Public Works, which will consider the payout in December, Hogan said.
With Fluor out of the picture, the remaining firms will seek a new “design-build” contractor to replace Purple Line Transit Constructors, PLTP’s prime subcontractor. (Fluor was also part of both PLTC and another consortium — Purple Line Transit Operators — that is slated to run the Purple Line once it is complete.)
The search for a new primary subcontractor will take place “in coordination with the Maryland Department of Transportation and Maryland Transit Administration,” according to an MDOT press release.
In the interim, MDOT and MTA will retain oversight of hundreds of contracts and purchase orders — including light rail car manufacturing, bridge work, stormwater drainage, paving, and utility and pump station construction.
The agencies will also push forward with design work, permit acquisition and utility work in the Purple Line corridor.
With the project nearing the half-built stage, PLTC’s decision to abandon the Purple Line left dozens of unfinished work sites across the two counties, leading to concerns that neighborhoods would be blighted for weeks or months. Local leaders and business owners also worried about the impact to pedestrian safety, traffic and commercial activity.
Del. Marc Korman (D-Montgomery) called the announcement “the most efficient and cost-effective means to keep the project moving and toward completion.”
“Obviously it’s too bad we were ever in this position but the settlement is in the relatively low end of the claims,” he added.
Jane Garvey, the chairwoman of Meridiam North America and head of the Purple Line Transit Partners Board, said “Today is a great day for everyone with a stake in the Purple Line’s success but most especially for the people of Maryland.”
“On behalf of my colleagues at Meridiam and our partner, Star America, we express our thanks for the resilient partnership we share with Gov. Hogan, with Secretary Slater and the MTA,” she added.
Montgomery County Council member Tom Hucker (D) tweeted: “In an ideal world, MDOT & PLTP would have avoided this stalemate and legal fight. But today’s news allows Maryland’s #1 econ development project to move forward. And it does so w/o any new expectation on @MontgomeryCoMD & Prince George’s taxpayers. Congrats to Sec. Greg Slater!”