A specific explanation of why the company, Boise-based Washington Group International (WGI), backed out of the bidding process has not been forthcoming; asked that very question, SMP officials said WGI was not willing to take on as much risk as its fellow lead partner, Fluor Corporation, a giant Houston-based engineering and construction firm.
What kind of risk? According to sources close to the negotiations, WGI couldn't stomach so-called "third-party liabilities"--risks that involve outside entities, like the city council and City Light. If the city fails to sign off on a permit on schedule, for example, the bidder--not the SMP--is responsible for the cost of any delays. Pushing that risk back onto the monorail agency would have reportedly added up to $30 million to the cost. Concerns about so-called "joint and several liability," a provision that caused Bombardier-led Team Monorail to withdraw from the bidding process, were reportedly not among the reasons WGI decided to leave.
The last-minute reorganization (negotiations, underway since last September, are expected to wrap up this summer) also raises questions about whether a Fluor-led Cascadia is capable of building the monorail, or if other partners need to be brought in to assist the firm. Some suggest, more radically, that the entire project be put out again to bid.
"It's the Washington Group that has the transit experience, not Fluor," says Team Monorail spokesman Blair Butterworth. "We have severe doubts as to whether Cascadia would have qualified" to bid without WGI's involvement. Board member Cindi Laws says she expects that subcontractors will be brought in to lay the elevated tracks and other structures for which WGI was responsible, although others at the agency say there's no plan to bring in outside partners. "Fluor is a very qualified, capable company," Horn says.
Still another question--why did the SMP withhold information from the public about Cascadia's restructuring, failing to mention the change at a press conference it held one day after the company made its announcement?--remained unanswered this week. For his part, Horn says he simply didn't consider it news. "This [pullout] is a bit of a nonevent as long as Cascadia has everything they need to build the project," he says. "That's assuming we accept the reorganization, and we're deciding next week."
But both Butterworth and Laws were incredulous at Horn's contention that the withdrawal was no big deal; Butterworth, in fact, called the omission "inexplicable," adding, "When you're a public agency sometimes you have to tell people things you don't want to tell them." Laws, a staunch advocate of letting more light shine on the inner workings of the agency, says that while the shakeup isn't "a big deal" as far as Cascadia's financial stability, "it is a big deal that a major partner pulled out."
"Of course it's worth it to tell the public. "