Dulles Rail Project costs spiral out of control

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The $6 billion Dulles Rail project has been the subject of controversy for high toll rates, delayed construction, and union favoritism that could send jobs to out-of-state firms. Republican officials trace the source of the problems to Kaine, who ceded the Virginia toll road to the Metropolitan Washington Airports Authority (MWAA) in 2007.

“It was Tim Kaine’s decision as governor that turned management of the Dulles Rail project over to the Metropolitan Washington Airport Authority (MWAA) in the first place,” Delegate Tim Hugo said in a statement. “The rising costs, the jobs lost to other states, and the ongoing mismanagement of this project are the result of Tim Kaine’s bad decisions.”

The news worsened Tuesday when the Department of Transportation’s inspector general released a scathing report on the MWAA, detailing a culture of secrecy, lavish spending, and potential corruption.

The audit found that MWAA’s 12-member Board of Directors, appointed by officials in Virginia, Maryland, and the District, operate outside of federal regulations, allowing them unlimited use of taxpayer-funded travel with limited accountability.

Federal employees are restricted by a per diem when travelling on business, while MWAA members face no such threshold. The board members took advantage of this loophole, according to the report. Taxpayers footed the bill for a number of over-the-top expenses, including a $238 reimbursement for two bottles of wine, $4,800 for three meals in Hawaii, and a $9,200 plane ticket for a trip to Prague.

The MWAA board operates in the dark, awarding a slew of no-bid contracts, some of which could violate conflict of interest statutes imposed on federal agencies.

One member awarded a $100,000 contract to his wife’s law firm without soliciting competitive and open bids to the work.

“This certainly falls short of industry standards,” Virginia Delegate Barbara Comstock said. “They continue to make exemptions for themselves and they aren’t being supervised.”

U.S. Rep. Frank Wolf (R., Va.), who called for the inspector general’s audit in March 2011, said he was not surprised by the report.

“There’s ethical lapses, contractual lapses all over the place,” Wolf said. “There is much more to be disclosed.”

The $100,000 law agreement was no ordinary conflict, according to Wolf. The board hired the law firm in an attempt to dodge a federal law passed in November that reauthorized MWAA with a provision to expand the board, allowing Gov. Bob McDonnell (R., Va.) additional appointments.

The MWAA resisted when it appeared that McDonnell’s appointments would reverse the pro-union mandate.

“We passed a bipartisan bill signed by the president on Nov. 18 and they hired a lawyer to contravene the will of Congress and the president,” Wolf said.

That is not the only conflict of interest at MWAA, according to Virginia lawmakers.

Kaine appointed Dennis Martire, a vice president of the Laborers’ International Union of North America (LiUNA), to the board. Martire has pushed openly for a Project Labor Agreement, which would mandate union rules for construction. Such an agreement could preclude Virginia companies from competing for the job, since only 4.6 percent of workers are unionized in the right-to-work state.

Workers represented by LiUNA have obtained several MWAA contracts. And though Martire recused himself from voting on the issue, he helped draft the PLA policy and remained in the room as other board members took up the vote.

The project ran $150 million over budget in the first phase of construction and Virginia is pressuring the MWAA to allow McDonnell to replace Kaine’s appointees on the board. McDonnell suffered a setback Monday when Virginia’s General Assembly rejected his bid to withhold funding from the project until the board allowed new appointments.

“[The report] seems to validate many of our grave concerns with the governance and decision making within this vital transportation entity,” McDonnell spokesman Jeff Caldwell said. “This is why Gov. McDonnell has been calling for substantial reforms and additional representation from Virginia to influence decisions by this entity.”

Martire’s fellow directors have stood their ground on the use of unionized labor.

“We aren’t changing anything,” authority member Bob Brown told the Washington Examiner in March. “We’re going to tell Virginia they should live up to the deal they made.”

Republicans are using that argument as a battering ram, saying that the “deal” belongs to Kaine rather than to the taxpayers of Virginia.

“That is Tim Kaine’s legacy … the costs are all on Virginia; we want people on there working with us rather than attacking us and working against us,” Comstock said. “These board members and union workers don’t have to live here and pay taxes and pay the tolls; they just get here, take the jobs, and leave.”

Costs could be passed onto Virginia drivers in the form of higher tolls. MWAA has weighed its maximum potential toll—the highest rate budgeters feel can be charged on a road without losing drivers—to $7 in 2013, up from $2 in 2005.

The Kaine campaign did not return calls for comment.

Wolf is calling for a permanent inspector general to oversee MWAA operations. Transportation Sec. Ray LaHood is considering the possibility of appointing a staffer to watch over daily operations at the agency, according to sources with knowledge of his intentions.

The inspector general expects to finish its audit by January 2013.