Houston gets refund from CAF

Houston’s Metropolitan Transportation Authority said Wednesday it has received $14 million from Spanish firm Construcciones y Auxiliar de Ferrocarriles, S.A. (CAF), as part of its settlement with the company involving a contract dispute.

Subsidiary CAF USA, Inc. originally was to provide light rail vehicles for Houston’s growing LRT system. But the Federal Transportation Administration last September ruled that CAF and previous Metro management violated federal procurement law and Buy America requirements for the equipment purchase.

In order for Houston to qualify for its $900 million Full Funding Grant Agreement, the FTA said Metro had to rebid the contract and follow its procurement process. That process is now under FTA review.

“I want to thank CAF for the professional way in which they handled this process,” said Metro Chairman Gilbert Garcia. “These funds will help carry out the new Metro’s goals of delivering first-class transit services to our deserving customers. This is $14 million we can put toward our rail cars.”

CAF relinquished claim to any additional payments for unpaid work and lost profit, in addition to paying a $14 million refund.

“This underscores the progress made by the new Metro,” said Metro President and CEO George Greanias. “From the beginning our focus has been, and will be, to create a stronger foundation for the agency based on clear goals, measurable objectives, and transparency.”