Chris Larsen, chief executive of one of the two losing bidders, Itinera Infrastructure and Concessions, said Thursday that a bid protest didn’t come from his team. He declined to comment further, saying he didn’t “know anything about the protest.”
The other unsuccessful bid came from the team of Spanish firm Cintra and London-based John Laing Investments. Patrick Rhode, Cintra’s U.S. vice president for corporate affairs, declined to comment, citing “confidentiality restrictions put in place under the procurement rules.”
A legal expert said such protests typically accuse the government or winner of unfairness by not following the bid rules or requirements. The leader of Cintra’s parent company has recently drawn attention to MDOT publicly citing “a significant gap” between the bid teams’ financial proposals.
Terry Owens, an MDOT spokesman on the project, said the state will resolve the protest via procedures outlined in the bid documents. He said the attorney general’s office is advising the agency.
“We cannot comment further or provide any documents at this time,” Owens said in an email.
MDOT announced Feb. 18 that it had selected Transurban and Macquarie Capital among three bid teams to plan the first high-occupancy toll lanes over about a year. The predevelopment agreement also would give the companies right of first refusal for a 50-year contract under which they would build the lanes, finance their construction and operate them in exchange for keeping most of the toll revenue.
MDOT has not released the winning proposal. However, Transurban chief executive Scott Charlton told analysts in a company earnings call last year that Maryland’s first phase, which includes building a wider American Legion Memorial Bridge and expanding I-270, would amount to about $4 billion.
A Transurban spokeswoman referred questions about any bid protest to MDOT, and a Macquarie spokesman declined to comment Thursday.
In a Feb. 25 earnings call with analysts, the chief executive of Ferrovial, Cintra’s parent company, said the team was “analyzing” the Maryland bid results, according to a transcript of the call.
Chief executive Ignacio Madridejos did not elaborate, except to say the scrutiny was a “result of the significant gap in the financial score of the bidders communicated to the public by the owner,” apparently referring to MDOT.
In a news release announcing Transurban and Macquarie’s selection, MDOT said the winning pitch “provided the best value.” It had a “strong predevelopment work proposal and a significantly stronger financial proposal” than the other two, MDOT said.
The state’s evaluation committee, MDOT said, allotted Transurban’s and Macquarie’s financial pitch 1,356 points — more than twice as many as the Cintra proposal.
Maryland Gov. Larry Hogan (R) has said the lanes will come at “no net cost” to taxpayers. However, under the proposed predevelopment contract, MDOT would have to reimburse the companies up to $50 million of their expenses if the state cancels the project or it doesn’t receive federal environmental approval.
Ed Tolchin, a Bethesda-based lawyer who specializes in government contracting for the law firm Offit Kurman, said bid protests are “very common” on large, lucrative projects.
“As the bucket of available money becomes smaller with budget cuts, people fight a lot more over these awards,” said Tolchin, who is not connected to any HOT lanes bid.
“To put a proposal together on a massive project like this, the costs could be very high,” he said. “It can involve scores of people, and that gets very expensive.”
Time is tight for MDOT, which has said it plans to seek approval of the predevelopment contract from the Board of Public Works in May. A state contract may be executed amid a pending protest only if the board finds that doing so “without delay is necessary to protect substantial state interests,” according to state regulations.
MDOT spelled out in bid documents how it would handle a protest. First, the state’s contracting officer would decide whether to accept or reject the allegations. The protester may appeal that decision to the state transportation secretary and then, if still not satisfied, “pursue any available judicial remedies,” according to the bid documents.
That process appears to bypass the Maryland State Board of Contract Appeals, which typically must adjudicate bid disputes before protesters may pursue a court case — a process that Tolchin said can add months.
Transurban was considered a front-runner for the Maryland project because it operates 53 miles of HOT lanes in Northern Virginia and is building or planning more, including extending the Beltway HOT lanes north to near the Maryland border. Transurban and the Virginia Department of Transportation also are discussing how the company might operate Virginia’s northbound HOT lanes across a new American Legion Bridge, a VDOT official has said.