Airports authority drops labor agreement for Silver Line project

The effort to extend Metrorail into Loudoun County cleared a major hurdle Wednesday when the regional authority building the new $6 billion Silver Line bowed to the demands of Virginia Gov. Robert F. McDonnell and scrapped a labor-friendly contracting provision.

But even as supporters of the rail extension were breathing a sigh of relief, another showdown loomed, as Loudoun leaders weigh whether the long-sought concession by the Metropolitan Washington Airports Authority is enough to win over Silver Line skeptics on the Loudoun County Board of Supervisors. Without Loudoun’s support — and money — the second part of the rail line could be in jeopardy.

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The MWAA voted 11 to 1 to drop an incentive for contractors who use a project labor agreement, or PLA, in building the second phase of the Silver Line.

For months, the board has been reluctant to reverse itself. But it relented after McDonnell (R) said he would withhold $150 million in funding for the line if the MWAA didn’t drop the union-friendly deal.

Still, Loudoun’s supervisors have not given clear indications of whether they will vote to support the second phase of the project and to put in the county’s share of construction costs, which, according to the latest estimate, are expected to total about $270 million. The board is expected to take a vote July 3.

Loudoun Supervisor Matthew F. Letourneau (R-Dulles) said the MWAA’s vote was welcome news — but by no means a guarantee of Loudoun’s support.

“The PLA was a barrier to entry to even have a discussion,” he said. “The way I would characterize it is that the chances now go from zero percent to fifty-fifty.”

At a meeting Wednesday night, Loudoun supervisors consulted with county staff and financial advisers regarding potential financing and debt structure options to fund the county’s commitment to the Silver Line.

Several financing possibilities have been presented to the board, including gas tax revenue, instituting a countywide commercial and industrial tax, or establishing special tax districts that would encompass areas closest to the Silver Line. Some supervisors have said they want to avoid using tax dollars to fund the project, and draw instead from the county’s general fund.

At the meeting, Supervisor Kenneth D. Reid (R-Leesburg) reiterated his concerns about the lack of existing revenue for phase two development, noting that Fairfax County established a special tax district in 2004 to help fund the Silver Line’s phase one construction.

“It’s very hard to say no if there’s funding in place,” he said. “But there isn’t funding in place, and that’s what worries me.”

If Loudoun pulls out, MWAA officials said it would probably delay the start of construction on the second phase by at least 18 months because funding agreements and parking and bus plans would have to be renegotiated.

The MWAA board had been split over whether to drop the PLA from the deal. Tom Davis, a Virginia board member, said that as he and MWAA Chairman Michael Curto talked to other directors, they conveyed this simple message: “There’s no $150 million and no Loudoun if we don’t take it out,” referring to the PLA. “Do you want to be known as the ones who killed the project?”