Construction giant gets $89.2M contract to expand Midway checkpoints

A clout-heavy construction giant once accused of minority business fraud has been awarded an $89.2 million contract to oversee the long-awaited expansion of passenger checkpoints at Midway Airport.

F.H. Paschen/S.N. Nielsen was the lowest of only two bidders for the complex security checkpoint contract. The only other bidder — a joint venture of IHC Construction and II in One Contractors — submitted a base bid of $91.2 million.

Two years ago, Mayor Rahm Emanuel drove a final nail into the long-stalled plan to privatize Midway and took the airport’s future into his “own hands” — by confronting Midway’s biggest weaknesses and passenger annoyances: parking, security and concessions.

The $248 million project was touted as the biggest upgrade of the Southwest Side airport since former Mayor Richard M. Daley’s $927 million reconstruction project that included a new terminal.

It called for adding 1,400 more premium parking spaces, a Taste-of-Chicago-style concession makeover with more space and 27 security lanes, instead of 17, to unclog a notorious passenger bottleneck.

Paschen/Nielsen will now preside over that dramatic increase in security checkpoints.

It will be made possible by widening a pedestrian bridge over Cicero Avenue — from 60 feet to 300 feet. That will create an 80,000-square-foot “security hall” with 20,000 square feet of additional concession space.

Ald. Mike Zalewski (23rd), chairman of the City Council’s Aviation Committee, has said he can’t wait until the security checkpoint nightmare has been put to rest.

“When that bridge first opened, there were six lanes there. And sometimes, three or four TSA security people would decide to go on break . . . and leave it down to two lanes,” Zalewski said on the day the ambitious project was unveiled.

“There have been times when the line has been all the way back to the Orange Line bus station. It was probably every bit of two blocks long. Until we got the TSA situation straightened out, many, many people missed their flights because they were in line too long.”

Twelve years ago, Paschen-Nielsen was on the defensive with City Hall.

It happened after the Daley administration accused the construction giant of minority contract fraud and took the first legal step toward barring F.H. Paschen/S.N. Nielsen from doing business with the city.

At the time, then-Chief Procurement Officer Mary Dempsey had promised a “total scrubbing” of a minority set-aside program tainted by corruption and cronyism and set her sights on one of the city’s biggest targets.

At issue were the veracity of documents Paschen/Nielsen submitted to meet the city’s minority set-aside requirements on two contracts: a pending $586,460 award to supply steel for the Columbus Drive underpass, and a $432,237 contract already under way to do steel and decking work on construction of a marine safety station.

On the Columbus Drive project, Paschen/Nielsen was accused of submitting a phony signature purporting to be the president of Mitchell Steel, a women-owned subcontractor.

On the marine station job, Paschen/Nielsen was accused of claiming Meccor Inc. as its minority partner, even though then-first deputy procurement officer Lori Lightfoot claimed the company “didn’t know anything about the contract and wasn’t participating.”

Paschen/Nielsen was given 30 days to counter the city’s charges in a process that could have resulted in a pair of costly penalties: stripping the joint venture of the nine contracts it now holds, one of them valued at $20 million, and barring the company from doing business with the city for a period of three years.

Scott Poremba, then-president of F.H. Paschen, responded to the city’s charges by citing his company’s “long track record of working effectively with MBEs and WBEs” in the Chicago area.

An attorney who represented Paschen/Nielsen in that investigation said Monday that no debarment ever resulted from the 2005 investigation.

“The company responded to the city’s letter and the city decided to take no further action,” said the attorney, who asked to remain anonymous.