MTA quietly institutes new rules requiring it to debar certain contractors
Published on May 23, 2019 by
MTA quietly institutes new rules requiring it to debar certain contractors
WRITTEN BY DANA RUBENSTEIN
WRITTEN ON MAY 23, 2019
This week, the Metropolitan Transportation Authority quietly instituted new rules requiring it to debar contractors for failing to complete projects on time and on budget.
The rules were mandated in this year’s state budget, but the MTA’s decision to hastily institute rules that could dramatically alter the way the MTA does business — and to do so without board approval, and without the typical public scrutiny of those rules — sparked an outcry during a closed-door Wednesday meeting of MTA board members, knowledgeable sources told POLITICO.
At issue was not just the secretive process by which the MTA instituted the new rules, but also the way in which those rules were written. Some MTA insiders argue that the rules should have given the MTA more discretion over when to debar companies from doing business with the authority. But as written, the rules seem to require the MTA to automatically debar contractors if certain conditions are met.
Further, the MTA promulgated the rules on an emergency basis, thereby evading the typical 60-day period during which the public has time to comment before rules go into effect. Instead, the MTA reversed the normal order of things: the rules are already in effect, and the public has 60 days to comment on them, during or after which the MTA may or may not amend them in response to those comments.
“It’s illogical that the board would not vote on this,” said John Kaehny, executive director of Reinvent Albany.
And then there are the underlying policy implications. Several transportation experts argue that the rigidity of the rules, as promulgated by the MTA, will make it even harder for the authority — already a notoriously difficult client — to find contractors willing to work with it.
“It’s a very strong tool, but it has to be used very carefully,” said New York City Transportation Commissioner Polly Trottenberg, who is also an MTA board member.
The new rules, acquired by POLITICO, say the MTA “must” debar a contractor for five years from doing business with the MTA if it determines that the contractor has failed to complete its work within a certain time frame or budget.
In such a scenario, the authority must notify the contractor of its intent to debar, and then hold a hearing on the matter.
“The MTA is no longer in the business of paying contractors that don’t deliver,” said MTA spokesperson Maxwell Young. “Among the recent historic reforms, the state budget gave the MTA the power to debar contractors that are continuously late and over budget, and it is imperative that these regulations, which are required by state law, are expeditiously enforced to protect our customers, taxpayers and the agency. It is a new day at the MTA and we are taking real action to hold all contractors accountable, and — as the vast majority of New Yorkers are demanding — to fundamentally change the way we operate.”
Though this year’s state budget did require the MTA to develop debarment rules, critics say the MTA’s implementation of that budgetary requirement is too rigid, too rushed and strips the MTA of discretion.
“It’s a shocker to the industry I think,” said Carlo Scissura, president of the New York Building Congress, a construction industry group. “Not what anyone expected. No hearings, no discussions.”
Gov. Andrew Cuomo effectively controls the MTA, and these new rules come amid his bid to dismantle what he describes as the “transportation industrial complex.” It also comes as the MTA wrangles with contractors Siemens Mobility and Bombardier Transportation over their much-delayed installation of a new railroad safety system.
It’s not clear if the MTA intends to target Siemens and Bombardier with debarment proceedings.
“I checked around — to the best of my knowledge, we have not received any letter from the MTA,” said Bombardier spokesperson Maryanne Roberts.
A spokesperson for Siemens Mobility said it hasn’t received any notification of debarment proceedings either.
The rules also come as the MTA gears up for its next major capital improvement plan, which — given the uproar over the state of the subway — is more aggressive than most.
The program depends on the MTA’s ability to bid out contracts to companies willing to do business with the MTA.
“I think that contractors and other professionals that are doing work will have to start thinking long term if it is in their interest to do this work,” said Scissura, whose organization’s membership does not include Siemens or Bombardier. “I think that the timing is bad.”
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