In the race to be the best non-functional transit system in California, the LAX Automated People Mover has taken a narrow lead over the California High-Speed Rail.<\/p>\n
Both are non-functional, but the Automated People Mover has train cars. There are no people in them, so while it\u2019s automated, it\u2019s not a people mover. Therefore it remains eligible to compete in the non-functional race event.<\/p>\n
The little train ride at the airport, just 2.25 miles long, has been named SkyLink. It\u2019s all-electric, very climate-forward, and as a bonus it\u2019s expected to reduce traffic. So far, it has only reduced its own bond rating.<\/p>\n
On July 21, Fitch Ratings downgraded approximately $1.2 billion of bonds issued by the California Municipal Finance Authority on behalf of LAX Integrated Express Solutions, LLC, known as LINXS, from junk to junkier and placed the bonds on \u201cRating Watch Negative.\u201d Fitch noted the \u201cheightened risks\u201d that could lead to a \u201ctechnical event of default.\u201d<\/p>\n
Even though the project is described as \u201c99.6% complete,\u201d it\u2019s so late that it might not be ready for passengers by the drop-dead date in the bond contract, giving lenders the opportunity to demand immediate repayment or extract other concessions. What\u2019s called the \u201clongstop\u201d date is on or about October 8.<\/p>\n
There\u2019s a separate \u201clongstop\u201d date for the project itself, separate from the bond financing, of December 8. If the little train hasn\u2019t achieved \u201cPassenger Service Availability\u201d (PSA) by then, Los Angeles World Airports (LAWA) will have leverage to extract concessions.<\/p>\n
The contractor, LINXS, blames the city for the delays and filed a lawsuit in July with all the gory details. The Los Angeles Department of Water and Power is part of the problem. According to the lawsuit, a 2025 power outage delayed progress for more than four months, and the city refused to sign a necessary interconnection agreement with LADWP related to solar panels. Further, LAWA changed roadway and other drawings, allegedly so it could declare certain LINXS work \u201ccomplete\u201d and allow other contractors into the areas to work, which caused problems.<\/p>\n
And, LINXS alleges, LAWA concealed the real causes of the problems in order to shift blame to the contractor.<\/p>\n