SAN FRANCISCO — A public employee union is suing to block a California public-private partnership that would design, build, operate, and maintain a six-lane link between San Francisco and the Golden Gate Bridge.
The lawsuit is part of an ongoing battle over P3s, which put private companies in some roles traditionally reserved for state and local authorities.
The Professional Engineers in California Government earlier this month filed the lawsuit seeking an injunction against the California Department of Transportation and the San Francisco County Transportation Authority to have the Presidio Parkway Project returned to competitive bidding. They allege the process violates state statutes.
The project, which will replace Doyle Drive in San Francisco, would use $150 million of private-activity bonds to cover part of the estimated $358 million cost, according to the financing proposal. Golden Link Partners, the consortium that outbid three others, would also receive $28 million in annual payments over a 30-year contract that would be tied to targets for operating and maintaining the roadway.
The union alleges the transportation authorities are “wasting nearly $1 billion on a no-bid P3 contract which is not authorized by statute,” states the suit filed in state Superior Court in Alameda County. The union wants the project returned to a traditional bidding process.
“The basic reason [for the lawsuit] is to get the project back on course,” said Bruce Blanning, executive director for PECG, which represents 13,000 state employees, primarily Caltrans engineers. “We are seeking to do this project the way they have been done for decades.”
A hearing on the lawsuit has yet to be scheduled. Before filing the suit, PECG fought the approval of the P3.
Even with the looming lawsuit, Caltrans remains optimistic about the timetable.
“We don’t have any reason to believe [the lawsuit] will impact the project at this time and are on track to reach commercial close this year,” said Michael Bowman, a spokesman for the state’s Business, Transportation and Housing Agency, which oversees Caltrans.
The winning proposal still needs to finish its vetting, but no other approvals are needed. The Presidio would be the first California project financed under legislation approved by lawmakers in 2009, with Gov. Arnold Schwarzenneger’s strong support, to push for greater use of public-private partnerships.
Some see the suit as a way to try to undermine the new P3s. Paul Meyer, executive director for the California branch of the American Council of Engineering Companies, said the engineers union has for decades fought the inclusion of the private sector in transportation projects.
The PECG’s “goal is to gain leverage to stop these public-private partnerships,” he said. “They want to keep their monopoly.”
Meyer’s said Caltrans only uses the private sector for around 10% of its workload, well behind the 50% to 60% used by most state transportation departments.
He said P3 advantages include assured long-term maintenance and a shift of the risk of higher costs to private companies.
The ACEC is studying its legal options in response to the lawsuit, Meyers said.
The new parkway project will replace a 1.5-mile portion of U.S. Highway 101 with a new six-lane roadway linking San Francisco and the Golden Gate Bridge. The existing roadway — which is 73 years old and handles 120,000 trips per day — does not meet structural standards and regularly faces snarled traffic.
The parkway has two major phases. Phase one, which is underway, will upgrade the road to meet earthquake-safety standards by late October 2011. The second phase will complete major construction and finish the project by spring 2014.
The new road will snake through the Presidio, a national park. It will also improve the environment and enhance pedestrian and bicycle access at the park.