Transurban picks Tutor Perini for Maryland project after 2-year delay

Jenny WigginsInfrastructure reporter

Sep 25, 2022 – 12.17pm

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Transurban’s plan to develop a $5 billion toll road in the US state of Maryland has inched forward after it finally found a construction company to build it, but the project has more hurdles to overcome before getting under way.

Transurban and joint venture partner Macquarie Capital have named a US contractor, Tutor Perini, to add tolled lanes and rebuild the American Legion Bridge in Maryland after winning the project early last year.

Transurban declined to comment on the terms of its arrangements with Tutor Perini, including whether the US company would be issued with a fixed-price contract.

Transurban wants to expand the American Legion Bridge across the Potomac between Maryland and Virginia and add new tolled lanes. — Transurban has finally found a construction company to replace the American Legion Bridge in Maryland and add tolled lanes.

It said only that the joint venture would work with Tutor Perini, which is the US’s seventh-biggest local contractor and reported a net loss of $US63 million in the three months to June, to “drive value and efficiencies” in design, pricing and delivery.

Tutor Perini has a reputation for being litigious on infrastructure projects and issuing so-called “change orders” (modifications to contracts) to try to boost profits. It is involved in several lawsuits, including on the Alaskan Way Viaduct and the George Washington Bridge Bus Station.

Only one other contractor submitted a proposal for the Maryland tolled lanes, according to Tutor Perini.

The choice of contractor comes almost two years after Transurban and Macquarie asked the Maryland transportation department to drop its initial choice, Archer Western Construction, from the project proposal.

They put their names down as “lead contractor” and the transportation department approved the change in November 2020.

But rival losing bidder Ferrovial argued there was no “qualified lead contractor” when Transurban and Macquarie were selected after a competitive bidding process. It has taken legal action against the joint venture in the Maryland courts.

Ferrovial, which is among the Spanish companies fined in July by Spain’s National Markets and Competition Commission for allegedly uncompetitive practices on public construction and infrastructure tenders, also alleged that Transurban and Macquarie submitted their bid at “unrealistically low margins”.

The Maryland project received federal environment approval in late August but is politically sensitive. The Washington Post has reported that a new governor in Maryland could potentially scale it back or cancel it if the current governor, Larry Hogan, did not finalise a financial contract before his term ends in January.

Community groups such as the Maryland Transit Opportunities Coalition oppose the tolled lanes project and are pushing politicians to spend money on rail links instead.

Transurban has not specified a date by which it plans to submit a development proposal for the tolled lanes to the Maryland transportation department and execute a design and construction contract.

Transurban chief executive Scott Charlton acknowledged in May that the Maryland project had “quite a few issues” including COVID-19-related delays, and it was uncertain if financial paperwork would be signed off by the end of the year.

Macquarie has been considering selling down its 40 per cent stake in the project joint venture.

Jenny Wiggins writes on business, specialising in infrastructure and transport. Connect with Jenny on Twitter. Email Jenny at jwiggins@afr.com