Foothill Extension officials say lawsuit involving Monrovia puts project at risk

A dispute has broken out between the Gold Line Foothill Extension Construction Authority and the city of Monrovia over the purchase of property for a rail car maintenance yard for the project.

Construction Authority officials say it threatens the schedule and budget for the project — officials have previously said they could finish it by 2014 and are now saying their goal is early 2015. It is important to note that the Authority is an independent agency that is building the line that Metro will operate upon its completion.

The Foothill Extension will run from the Gold Line’s current terminus in Pasadena to the Azusa/Glendora border. It is a project funded by the voter-approved Measure R sales tax increase.

This story in the Star News offers the city of Monrovia’s view. Below is an update from Construction Authority CEO Habib Balian:

Over the last few days there has been significant discussion in the media relating to the Construction Authority’s negotiations with the City of Monrovia to purchase 14 acres of city-owned land for the project’s maintenance and operations facility, and third-party challenges to the sale. Today, the Pasadena Star News ran a front page story.

Authority Board Chairman Doug Tessitor submitted the op-ed below today, outlining the challenging circumstances that face us.

As Chairman Tessitor points out, it is the fiduciary responsibility of the Authority to complete the project in the most effective and efficient manner possible within the limited resources available.  The lawsuit against the City of Monrovia by the nearby property owner has changed the conditions on which we have been negotiating with the city over the last few months, and has serious implications that put the entire project at risk.  The Authority remains committed to working with the City to resolve these issues, and has gone so far as to offer to share the cost of the lawsuit’s impact in order to keep the project on schedule. The City has rejected those offers to date.

Our board now faces some tough decisions on how to best navigate through these issues to keep the project on schedule and budget.

The Journey Continues,

Habib F. Balian

June 10, 2011

Steve Scauzillo
Opinions Editor
San Gabriel Valley Tribune

Subject:  Op-Ed

Dear Mr. Scauzillo,

In 2010 the Construction Authority learned it was required to build a maintenance and operations facility to complete the Foothill Extension from Pasadena to Azusa as a requirement of the Funding Agreement between the Authority and Metro.

Since then the Authority proceeded to environmentally review the facility alternatives. In January 2011, the Authority Board certified the final environmental document and selected a 24-acre site in the City of Monrovia for the facility. This decision was supported by the City. We then began negotiating to purchase the land within the selected site, including 14 acres owned by the City of Monrovia and its Redevelopment Agency and 10 more owned by multiple private property owners.

By March 2011, the Authority and City had come close to agreeing on a $56 million deal for the city-owned properties, based entirely on, of course, the City’s ability to sell its land free and clear without litigation or other encumbrance. In fact, the draft Purchase and Sale Agreement stated there was no threatened litigation. It was not until March 22, 2011 that the Authority was made aware of a 2004 covenant between the City of Monrovia and an adjacent property owner allegedly prohibiting the transaction between the City and the Authority, and that the City would not be able to sell its land without embroiling the Authority in very costly and schedule-threatening litigation. This property owner has since filed 2 lawsuits, one challenging CEQA and the other against the City of Monrovia contesting the sale and purchase of the City’s properties.

These facts materially change the Authority’s ability to pay $56 million as part of a deal for the City’s properties and pose a significant risk to the viability of the entire project. The Authority very much believes that the City should be involved in resolving this situation.

Given the new conditions, the Authority is seeking the City’s partnership in sharing some of the costs to settle with the private property owner and resolve the City’s lawsuit regarding its 2004 covenant with the same property owner.  At this point, however, it does not appear that the City considers that it has any responsibility in the litigation or the cloud over its property.

The Authority’s options are clear: we can give into the demands of a few property owners and possibly bankrupt, shorten and/or significantly delay the project; or we can take every step reasonably necessary to complete the project to Azusa on time and within budget while preserving resources to extend light rail to the county line.

Doug Tessitor
Board Chairman
Metro Gold Line Foothill Extension Construction Authority

 

6 replies

  1. Lawsuits are a fact of life on any rail project and the time and resources required to defend against them should be factored into the timeline at the start of the project.

  2. Councilman Lashes Out at Mayor, Blasts Emergency Meeting to Sell $40 Million in Land to Gold Line

    Adams wrote. “Every city along the Gold Line will benefit from the yard yet we are the only ones taking a loss from the transfer of our land to the Gold Line, which is wrong.”
    ——————–
    To resolve the problem the City of Monrovia needs money to settle the law suit. Other cities along the line who will benefit from the line and the MTA needs to chip in some money to get the problem resolved.

    http://monrovia.patch.com/articles/councilman-lashes-out-at-mayor-blasts-emergency-meeting-to-sell-40-million-in-land-to-gold-line

  3. Does the addition of Part 1 of the Foothill Extension to the Gold Line really require a second car barn?

    Is the existing maintenance facility near the LA River more than adequate for the Gold Line if it were up and running from Asuza to Atlantic (East L.A.)?

    What does LA Metro think (since they are going to be the ones to operate such a line)?

    Is there then possibly space along Phase 2A (Asuza-Montclair) for this second facility if it really can’t be built in Monrovia?

    (After the Regional Connector in Downtown L.A. is built there isn’t going to be as much of a need for so many)

  4. @ Erik G

    Correct me if I am wrong but from what I have heard in order to save cost of the Eastside Gold Line Metro or the Construction Authority decided to not build an extra Gold Line Maintenance Facility next to the Red Line near union station. So the current rail yard by the LA river is not going to have enough capacity to handle more trains necessary rush hour operation for this extension.

  5. I think that if in 1987 someone had told me that, in developing a transportation system to best address the problems of greater Los Angeles it would become a priority to build a train line to Monrovia and Irwindale, over say – a train to Downtown Glendale, West Hollywood, Venice Beach, the Burbank studio district, the Hollywood Media District, Ventura Boulevard, the Fairfax District, New Chinatown (SGV), west Koreatown, the Sunset Strip, south Vermont – I would’ve laughed in disbelief.

    Let it stall. The fact that it is being built at all is purely the product of politics.