MARC contract awarded to Bombardier Transportation Services USA

The Board of Public Works approved a contract Wednesday that will shift operation of MARC’s Camden and Brunswick passenger lines to the Pennsylvania subsidiary of a Montreal-based rail company, finally ending a process that began more than two years ago.

Bombardier Transportation Services USA’s contract to run MARC’s Camden and Brunswick lines runs for five years and eight months, and is worth $204.7 million.

Bombardier Transportation Services USA Corp., a subsidiary of Bombardier Inc., won the contract over Keolis Rail Services America LLC, a subsidiary of the French national railroad.

The contract award was delayed this month when the Maryland Transit Administration asked for the item to be pulled from the board’s agenda following a dispute over the minority business participation rate for subcontracts. The contract initially called for 7 percent participation, but now calls for 7.97 percent over the course of a $204.7 million, five-year eight-month deal, which includes a five-year, $205 million option.

With the adjustment, MTA officials told the board that most of the work that could be subcontracted over the length of the contract would be set aside for minority firms.

Bombardier will operate the train service, but the MTA owns the cars, and CSX Transportation Inc. owns the rails.

The board, composed of Lt. Gov. Anthony G. Brown — sitting in for Gov. Martin O’Malley — Comptroller Peter Franchot and Treasurer Nancy K. Kopp, unanimously approved the contract, but not until after Kopp was satisfied with answers Bombardier’s president gave about the company’s business dealings in Iran.

Thomas J. Martin, president of the company’s U.S. subsidiary, said Bombardier had five “small, legacy contracts” in Iran that would probably expire “within the next couple of years.” The contracts are for the delivery of subway cars and components and in compliance with state and federal law, he said.

“Once these contracts are concluded, our corporation will no longer do any business in Iran,” Martin said.

In a statement, O’Malley lauded the selection of Bombardier.

“We have identified a quality company with a wealth of experience in operating commuter rail service,” O’Malley said. “Together with our recent MARC investments including new locomotives, new passenger cars, station improvements and safety enhancements, the MARC system is in better condition today than at any time in its history.”

Maryland has done business with Bombardier before. Last year, the MTA ordered 54 multilevel MARC rail cars from the company, which also previously refurbished 34 single-level commuter coaches.

CSX Transportation, the previous operator of the lines, said in June 2010 that it would like to get out of the commuter rail business and instead focus on freight, its core business.

Keolis Rail Services America, the Rockville-based subsidiary of the French national railroad, SNCF, said at the time it was a finalist to win the operations contract, but the French railroad’s ties to the Holocaust caused a stir that rippled through state government.

The request for proposals was ultimately scrapped in December 2010, officials said, in order to drum up more competition.

SNCF acquired 56.7 percent of Keolis Rail Services America in March 2010.

Holocaust survivors demanded during the 2011 General Assembly session that lawmakers force SNCF to disclose its cooperation with the Nazis as a condition for bidding on future RFPs.

A bipartisan group of legislators sponsored a bill — which was passed and signed into law by O’Malley — that forced SNCF to disclose its part in the Holocaust as a precursor to bidding on the MARC contract.

From 1942 to 1944, during World War II, 76,000 people were herded into cattle cars owned by the French national railroad and sent to the French border. German engineers then drove the trains to concentration camps.

In the latest round of bidding, Keolis came in second place, bidding $218.4 million. Silver Spring-based Veolia/Connex Railroad LLC was a distant third, bidding $265.5 million.