As with most things in life, one person's gain is another person's loss, and public-private partnerships are not exempt from these types of tradeoffs. To the state engineers and their representative union, the contracting out to private engineering firms of engineering services traditionally performed by Caltrans engineering staff represents one of those zero-sum games. This becomes the backdrop to a challenge to the Phase II improvement work on Doyle Drive, the highway approach to the southern terminus of the Golden Gate Bridge.
At the heart of the litigation is Streets and Highways code section 143, a section permitting public private partnerships. This statute allows Caltrans to hire outside engineering companies for work traditionally performed by Caltrans engineering staff. Work on Doyle Drive dates back to 1998, when, through a series of cooperative agreements between Caltrans and San Francisco County Transportation Authority (SFCTA), SFCTA undertook a number of feasibility studies for improving the roadway. In 2009, the Legislature significantly expanded potential opportunities for public private partnerships, also known as P3s. Caltrans ultimately awarded a P3 contract to a private contractor, and a separate cooperative agreement with SFCTA. The agreements called for a supervisorial role for Caltrans, but project construction would be the responsibility of the private contractor.
The state Professional Engineers union filed suit, seeking to set aside the contract and enjoin the action. The trial court denied relief, which was affirmed on appeal.
The plaintiff's primary attack claimed the project did not qualify as a P3, as Caltrans had not been acting as a responsible agency, as the initial engineering work had been performed by private consultants working for SFCTA. Responding to an argument over legislative interpretation, the appellate court ultimately concluded that responsible agency status required Caltrans to be responsible for the work, not that it was required to perform the work. The court held that, under the terms of the various agreements, this element was satisfied.
Given the current state budget pressures in Sacramento, it will be worth watching to see whether or not the less-government-rather-than-more movement will make further inroads into contracting out services traditionally performed by agency employees.
The Case:
Professional Engineers in California Government v. Department of Transportation (2011) Cal.App. 4th No. A131449, 2011 DJDAR. Filed August 8, 2011.
The Attorneys:
Somach Simmons & Dunn, Jennifer T. Buckman, Kanwarjit S. Dua and Gerald A. James for Plaintiffs and Appellants
Ronald W. Beals, Chief Counsel, Thomas C. Fellenz, Deputy Chief Counsel, Todd Van Santen, Assistant Chief Counsel and Erin E. Holbrook for Defendants and Respondents California Department of Transportation et al.
Nossaman LLP, Stephen N. Roberts, Stanley S. Taylor III for Defendants and Respondents San Francisco County Transportation Authority et al.
Stoel Rives LLP, Barbara A. Brenner and Craig A. Carnes for Amicus Curiae American Council of Engineering Companies of California
William W. Abbott is a senior partner in the law firm Abbott & Kindermann, LLP, of Sacramento.
