The state of Maryland and Purple Line’s private contractors recently agreed to settle a lawsuit over cost overruns that have accumulated due to delays and changes to the line’s design.
A settlement was recently announced that would end a lawsuit between the state of Maryland and the Purple Line’s private contractors. According to a press release released earlier this week, Governor Larry Hogan said, “The state will pay $ 250 million to come to terms with the private Purple Line Transit Partners, made up of Meridiam, Star America and Fluor put together.” As part of the settlement, “all outstanding financial claims will be settled and the current legal dispute between the parties will be ended”.
Statue of the judge; Image by William Cho, via Pixabay.com.
Prior to the settlement announcement, both parties had “sued over $ 800 million in cost overruns that had accumulated due to delays caused by other litigation and line design changes.” With the agreement, “the public-private partnership will only be continued with Meridiam and Star America from Paris from Long Island, New York, as P3 developers and investment partners,” says the agreement. From there, “instead of Flour and other partners, the group will find a comprehensive contractor who will complete the project,” according to the comparison.
When commenting on the matter, Hogan said:
“This agreement is an important step towards the completion of the Purple Line, a transformation project for our state and the region. I want to thank you [Transportation Secretary] Greg Slater and our partners at Meridiam and Star America have teamed up to find a path that leads to a new contractor. “
Purple Line now stepped in and said:
“A negotiation result between Maryland and the Purple Line Transit Partners has always been the quickest way back on track, and we are very grateful.”
Before reaching the agreement, Maryland considered “completing the project alone and managing hundreds of individual contracts”. In addition, “another P3 partner should be sought for the 16-mile line that connects the suburbs of Montgomery County with Prince George’s County from Bethesda to New Carrollton”.
Currently, the Purple Line is one of the largest public-private infrastructure partnerships in the country and should be completed in 2022. In most public-private partnerships, “the private company bears the burden of risks and costs while the state retains ownership. “Purple Line Transit Partners should provide partial financing in addition to the“ planning, construction, operation and maintenance of the project ”. However, Purple Line Transit Partners announced that the project will be discontinued as early as May. This led to “months of uncertainty”.
Since this uncertainty, work on the project has continued under state supervision, “including the manufacture of light rail vehicles, bridge construction, rainwater drainage, paving, supply and pumping station construction”. The work continues until a new designer moves forward.
Commenting on the latest agreement, Jane Garvey, Chair of Meridiam North America and a member of the Purple Line Transit Partners Board, said:
“The months of challenging but always in good faith negotiations led by Secretary Slater have paved the way for an agreement that will allow the project to move forward.”
Maryland and Purple Line Contractors close lawsuit and move forward with revised partnership
Maryland pays $ 250 million to settle disputes with Purple Line and replace the contractor