Aims to resolve cost overruns on transit bus contract
LIMESTONE, Maine — Maine’s top military official, Brig. Gen. Douglas Farnham, said last week he is optimistic about resolving cost overrun issues with the Maine Military Authority’s $19 million contract to renovate 32 Massachusetts buses.
Farnham and other officials are meeting with leaders of the Massachusetts Bay Transportation Authority soon to discuss a range of challenges and problems that have surfaced two years into the contract, Farnham said during a Sept. 28 press conference at the Loring Commerce Centre.
Earlier last month, Gov. Paul LePage announced that his administration would “ halt” the contract with the MBTA while renegotiating it. Farnham said Wednesday that work on the buses is continuing at MMA, although new purchases on parts and supplies have been temporarily frozen until cost issues are resolved.
Farnham added that he was visiting the facility in Limestone to tell the state-owned organization’s 63 employees that the LePage administration values their work but is looking to avoid putting taxpayers at risk of being on the hook for cost overruns.
“The news [out of the governor’s office] was a little bit shocking to them,” Farnham said. “I think there was no surprise they were struggling with the contract, but the press release was a little bit [shocking].”
The Maine Military Authority was created as “an instrument of the state of Maine” in 1997 to offer military vehicle repair services at the industrial park of the former Loring Air Force Base, and at its peak employed 500 workers devoted largely to renovating humvees. Following the drawdown of troops involved in the Afghanistan and Iraq wars, the MMA has downsized and shifted to servicing civilian vehicles, including school buses and transit system buses.
Over its almost 20 years in operation, the Maine Military Authority has consistently generated net income that’s been invested back in the facility, National Guard member tuition and the state general fund, Farnham said.
The 2014 MBTA contract — for which MMA was the sole bidder — called for refurbishing 32 diesel-electric public transit buses and adding another six years to their 12-year lifespan.
While MMA had been doing some small bus contract work, the MBTA deal marked new territory, and was “the first major contract of this new business model,” Farnham said.
The apparent underbidding of the contract does not appear to be deliberate, but stems from several factors, Farnham said – “the complexity of the project, the condition of the incoming buses, some unexpected part variations, misunderstandings in the scope of work.” Other challenges have included the tight-turning capabilities of the articulated buses and their dual diesel-electric engines. Articulated buses are hinged to allow easier maneuverability.
Farnham added that he believes that during the bidding, which was before he came to his current position, there was “a sense of urgency to demonstrate the capability of the [MMA] workforce and the facilities.”
The MMA has completed 11 of the 32 buses, and from the beginning there were challenges, Farnham said. For instance, the organization has had to source or in some cases make parts whose original suppliers are no longer in business. “There was a learning curve … and that was part of the plan,” Farnham said, adding that it might have been steeper than anticipated.
He said that MMA officials have “worked to reduce the costs, streamline the processes and define the scope of work. Some progress has been made, but not enough.”
Farnham said it is not clear if there will be penalties for cost overruns, or what the total cost overrun amounts to at this point.
A spokesperson for the MBTA said in an email that there have been no change-orders executed for the contract.
Farnham said that “the timeout is to really try and figure out where we are” in terms of the cost problems, and to work with the MBTA to find a way forward.
MMA has other smaller contracts currently, including for refurbishing school district buses and some of Maine’s fixed route bus operators, as well as other small contracts in the works, including servicing military vehicles for foreign countries, Farnham said.
“There is refurbishing work out there,” Farnam said. The MMA’s work bringing old vehicles back to almost-new condition is “cost-effective, whether it be for a school superintendent and a school bus, or a town and snowplows, or fixed-route operator buses or other military organizations.”
