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Dive brief:
- The Los Angeles City Council this month approved $200 million in contingency funds to handle legal claims from contractors building the Los Angeles International Airport passenger transportation project. This brings the total price tag of the project to $2.9 billion.
- Los Angeles World Airports and the builders are currently negotiating a series of issues that have delayed the completion date. Funds are expected to do so resolve a number of disputed claimsincluding disagreements over project schedule, access to technology and compensation.
- The design-build team is comprised of Fluor, headquartered in Irving, Texas, Balfour Beatty Infrastructure, headquartered in Atlanta, Flatiron West, headquartered in Broomfield, Colorado, Dragados USA, headquartered in New York City, and HDR Engineering, located in Omaha, Nebraska. Together they are known as LAX Integrated Express Solutions or LINXS.
Diving knowledge:
Los Angeles World Airports, the city agency that manages LAX, and contractors are in ongoing discussions about the final completion date, as well as payment milestones and technical access issues. Fitch, the bond rating agency that accesses the project’s finances, said in March that while construction was nearly complete in February, a “strained relationship” between the owner and the contractors is delaying the work.
“The increase in delays has been driven primarily by an ongoing request for information related to LAWA’s IT Network Access Requests (NAR), which is driving the critical path of the project. This information is necessary for LINXS to develop its test procedures and to install and configure network equipment and integration activities,” Fitch said in its March report.
However, on May 2 Document of the Board of Commissioners of Airports said Los Angeles World Airports and LINXS have been negotiating in good faith over the past year to resolve the issues.
“Recent discussions have focused on negotiating a potential global settlement for all pending relief event claims and an appropriate extension of time to complete the project,” the document says.
It’s not yet clear which claims the $200 million would settle, but to access the funds, the consortium must submit change orders to administrators at Los Angeles World Airports. Los Angeles World Airports CEO John Ackerman or the Board of Airport Commissioners can do this sign the change orders less than $40 million. For change orders worth more than that, only the board can approve, according to the document.
LAX makeover
People movement is the centerpiece of Los Angeles World Airports’ ground access makeover and marks its first public-private partnership, according to the project’s website. The electric train system features a 2.25-mile elevated guideway and expected to transport up to 30 million passengers each year between airport terminals.
According to the project website, the scope includes:
- Five stations that will connect the future Consolidated Rent-A-Car facility.
- Two intermodal transport facilities.
- Extended airport parking.
- Regional traffic in the LAX Central Terminal area.
In 2018, when the city council approved the project, it was originally supposed to cost $2.7 billion and open in 2023. It’s now on track for completion in October 2025, according to Fitch, but not yet an official opening date has been announced.
