Federal officials could penalize RTC over bus contract talks

Federal Transit Administration officials are closely monitoring negotiations over the nation's largest public transit contract and recently expressed concerns over the manner in which Regional Transportation Commission board members have handled the two bids.

If the four-month impasse between commissioners continues to block the awarding of a new contract, the transportation administration could step in and penalize the Regional Transportation Commission by pulling its federal funding.

"They have expressed concerns," said Jacob Snow, general manager of the commission. "We have gone through a process they reviewed. They said it was an excellent procurement."

Snow said the administration recently asked how much funding it provides to the commission. Its primary concern is that the controversy is resolved by March, when the month-to-month contract extension with current operator Veolia Transportation expires.

Snow said the federal agency contributes about $5.2 million to the commission each year for the public transit service. The bus contract is worth roughly $85 million a year.

"If push comes to shove and they pulled funding, we would have to find another source or cut services," Snow said. "I don't think it will come to that. We usually work things out."

The commission has not been able to agree on a new operator since May, when the board voted 4-3 to award the contract to First Transit, whose bid was $50 million less than Veolia's proposal. The state attorney general later ruled that on an eight-member board, the vote did not constitute a majority and forced members to rescind their decision.

Since then, votes on a series of issues dealing with the contract have made it clear four commissioners stand firmly behind Veolia and four support First Transit.

On Friday, District Court Judge Robert Bare said that the initial vote in May was valid and the attorney general was wrong to say it was not. He ruled that the commission is exempt from a law that defines a majority vote as one based on the number of members on the board, not the number of members present at a meeting.

Bare said the Nevada Legislature appeared to have reasons to allow the Regional Transportation Commission to govern itself. He stopped short of granting First Transit's request to step in and award the contract to the company.

The board meets Oct. 13, when it could decide to issue a new request for proposals, split the contract into regions or review the scoring of the bids. The commission must have "sound reasoning" do anything other than awarding the contract, Bare said.

Bare warned the commission against taking any arbitrary and capricious actions against First Transit.

Bare said if the votes continue to be deadlocked, he will consider intervening and settling the disagreement himself. Regardless of the outcome, representatives of both companies, with Regional Transportation Commission officials, expect more lawsuits to be filed.

Contact reporter Adrienne Packer at
apacker@reviewjournal.com or 702-387-2904.