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MTA back outs of contract with CityTime scandal company

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Under pressure to upgrade its subway radio system or face hefty fines, the MTA is seeking new bids for the work after quashing a $118 million deal with the contractor at the center of the CityTime scandal, agency officials said Thursday.

If the MTA doesn’t get FCC-mandated narrowband channels running by Jan. 1, 2013, the FCC could issue fines up to $1 million a day or shut off the radio system, which is essential for train operations, officials said.

“Because we have to proceed, we’ve taken the decision to cancel this procurement and re-solicit the contract,” NYC Transit executive vice president Robert Bergen told the MTA Transit Committee Thursday.

Virginia-based Science Applications International Corporation — the director of CityTime, the city’s payroll and timekeeping project that’s now being probed in an alleged $80 million fraud — got MTA approval in November for the subway radio work.

SAIC has not been accused of wrongdoing, but with a federal investigation into CityTime consultants, State Comptroller Tom DiNapoli wouldn’t approve the contract without certain concerns being addressed.

“The comptroller has asked a number of valid questions, which at this point, because the criminal prosecution and investigation is still ongoing, we really can’t answer,” Bergen said.

Comptroller spokesman Eric Sumberg wrote in an email that “New York can’t afford to face another scandal like CityTime. Today's decision by the MTA to end their contract with SAIC will help make sure the City doesn't have to."

The SAIC said it was disappointed with the decision.

“The MTA confirmed that SAIC’s bid was the best technical solution at the best price and would have saved taxpayers $30 million compared to the next closest bidder,” the company said in a statement, adding that it will bid again.

An MTA spokesman said a deadline for the new bids hasn't been set yet.

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