Spanish train manufacturer Talgo last week sued Gov. Scott Walker and state Transportation Secretary Mark Gottlieb, claiming the state stiffed the trainmaker to the tune of $4.6 million.
The Nov. 2 lawsuit -- which follows a notice of default sent by Talgo to the state in July -- stems from a contract signed by former Democratic Gov. Jim Doyle with Talgo to build two train sets for the state for a planned high-speed rail line between Madison and Milwaukee. But Republican Walker opposed the rail line and turned away $810 million in federal money that would have turned the plan into reality.
After the high-speed rail line fell through, the state had planned to use the new trains to replace aging train sets on Amtrak's Chicago-Milwaukee Hiawatha line, which carried nearly 820,000 passengers last year.
Talgo completed making the train sets, then told the state they were available for “pre-revenue service testing,” according to the lawsuit. But Talgo says the state claims that Talgo is responsible for the testing. Now the train sets are being warehoused.
Under the contract, the state was also to build a maintenance facility for the trains in Madison. In the meantime, Talgo build a temporary maintenance facility in Milwaukee. But the Republican-led Legislature’s Joint Finance Committee in March refused to authorize funding for the facility called for in the contract.
In a statement, Talgo CEO Antonio Perez says:
“We invested in the state of Wisconsin by building a manufacturing facility in Milwaukee and creating manufacturing jobs. We built the trains and otherwise performed our obligations under our agreements with the state of Wisconsin. In return, rather than being 'open for business,' the state used every conceivable excuse, whether fair or not and whether lawful or not, to ensure that Talgo did not receive what it bargained for, including by refusing to pay for the trains that Talgo completed. I don’t see how any company would in the future choose to do business with the state of Wisconsin when the state has shown that it cannot be trusted to honor contracts that it signed.”
For more on the state's train situation, here's a story I wrote in January.