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Starts & Stops

MBTA rejects railcar contract protests

In October, the Mass. DOT awarded the contract to build 284 Red and Orange line cars to CNR-MA, a China-owned railcar maker. Soon after, the losing bidders formally protested the decision.Dina Rudick/Globe Staff/Globe Staff

As the Massachusetts Bay Transportation Authority struggles through record-breaking snowfalls, the contract to buy new Red and Orange line cars cleared another hurdle after the T rejected protests from three losing bidders for the $566.6 million project.

In October, the Massachusetts Department of Transportation awarded the contract to build 284 Red and Orange line cars to CNR-MA, a China-owned railcar maker.

Soon after, the losing bidders — South Korea’s Hyundai Rotem, Canada’s Bombardier, and Japan’s Kawasaki Rail Car — formally protested the decision. All cited CNR-MA’s inexperience in the US railcar market and said the T gave an unfair advantage to the company.

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Last Monday, the T’s chief procurement officer, Silvio Petraglia, upheld the agency’s decision and defended the bidding process. In a letter to Kawasaki’s legal counsel, Petraglia said the process took more than five years as well as significant time and energy from the T’s employees, executives, and board members. The decision to give the contract to CNR-MA was not “arbitrary or capricious,” he wrote.

“The process was carefully designed to ensure fairness in the competitive bidding process and to maximize the benefits produced by that intense competition,” he wrote.

Petraglia repeated much of the same to Hyundai Rotem and Bombardier, who filed similar protests.

Harry King, a spokesman for Hyundai Rotem, said in a statement that officials disagree with the results and are pursuing an appeal to the general counsel. Officials from Kawasaki and Bombardier could not be reached for comment.

But it’s not smooth sailing for the contract just yet.

The deal is still in litigation as the losing bidders also filed a federal lawsuit accusing the T of a flawed and unlawful bidding process. A first hearing in the lawsuit was held last week.

A spokesman for the T has said agency officials believe the lawsuit has no merit.

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Transportation funding falling behind, group says

Last year’s transportation budget fell $41 million short of its projections, according to a recently released Transportation for Massachusetts report tracking funding since the passage of 2013’s transportation finance plan.

The Conservation Law Foundation’s Rafael Mares, who wrote the report, said it shows that the effects of underfunding the transportation budget would be felt in future years, as projected funding gaps grow. The transportation finance plan in 2013 diverted more money to the transportation budget but less than initially requested.

“The outlook is that the whole transportation funding system is still in need of significant attention in terms of revenue,” Mares said. “The snow has exposed a lot of these challenges.”

The report comes as controversy embroils the T about its performance amid several snowstorms.

In the wake of the delays, many transportation advocates — including the T’s general manager Beverly Scott, who recently announced plans to step down in April — have tried to turn the spotlight on investment in the system.

In his report, Mares found the state budget’s estimates for ice removal were woefully inadequate: MassDOT estimated $44 million for ice removal costs last year, but the price ultimately came to about $134 million. In previous years, the cost was on average $80 million annually. With this year’s record-breaking snowfall, the expense can only be expected to grow again.

In addition, Mares said the effects of a repeal of an automatic gas tax increase won’t be felt immediately but will generate more problems as time goes on. Next year, the transportation budget will lose $9 million because of the change and $27 million the following year.

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But the report, released Thursday, also found some good news for the transit system: In the 2014 fiscal year, the T brought in $31 million more in fares than projected because of an increase in ridership.

Mares said he hopes the report will help shine a light on problems that will become crucial without proper attention.

“I look at the progress report as a preventative health checkup,” he said. “Now we have an indicator of what we need to pay attention to and worry about.”


Nicole Dungca can be reached at nicole.dungca@globe.com.