Company agrees to pay $7.3 million after allegations it backed out of contract to run The Ride
An Ohio transportation company will pay $7.3 million to settle allegations that it backed out of a 2009 contract to run The Ride paratransit service for the MBTA, the attorney general's office said today.
First Transit, based in Cincinnati, allegedly violated the Massachusetts Consumer Protection Act when it backed out of the deal, the attorney general's office said in a statement.
“This settlement will bring millions of dollars back to Commonwealth's taxpayers that deserve the best in public transportation,” Attorney General Martha Coakley said in the statement.
First Transit submitted a $97 million bid to run The Ride in November 2008. It won a five-year contract in March 2009. In April 2009, the company allegedly learned its bid was significantly lower than other bidders, the attorney general's office said. In May 2009, the company abandoned the contract two months before it was slated to begin.
The company asserted that it had received inaccurate information in the request for proposal. The state contended that the company's reasons for breaking the contract were false, the attorney general’s office said.
The company said it expected to issue a statement this afternoon.