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Company installing Metro cellphone service facing financial trouble

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Local,Transportation,Kytja Weir

A company that is adding wireless service in Metro's underground rail system is in dire financial straits as the deadline looms to complete the project.

Powerwave Technologies Inc. is helping Metro fulfill a pledge to Congress to install more robust wireless service in all of the transit system's underground network by Oct. 16. But in a Securities and Exchange Commission filing made earlier this month, the company based in Santa Ana, Calif., said it has experienced "significant recurring net losses and operating cash flow deficits" for the past year.

"These conditions raise substantial doubt about the company's ability to continue as a going concern, and its success is dependent upon the successful outcome of its efforts to raise additional financing, restructure its operations, lower manufacturing costs and reduce operating expenses," it said in the filing.

Powerwave did not return phone calls for comment on whether it would be able to meet the deadline given such uncertainty. Metro declined to comment on whether the service would be ready in time, as did AT&T.

Already, though, the agency has fallen behind on some of its own milestones for the project and has faced unexpected challenges.

The wiring was supposed to be done overnight so it did not affect riders' service. But the contractors initially underestimated the amount of work that could be completed in one night, according to a Metro report. Then, when 50 contractors were dispatched to a single station they didn't have enough support escorts and safety monitoring.

Metro has had Verizon service in its underground rail network after cutting a 1993 deal with the precursor company Bell Atlantic. But a 2008 federal bill that provided $150 million in federal funding every year for 10 years required Metro to expand the service to other cellphone carriers so essentially anyone could get cellphone service underground. Metro then signed a deal called the "neutral host" agreement with major cellphone companies that would pay Metro $51.8 million over 25 years for access to the tunnels.

Congress required the transit agency to have the 20 busiest underground stations wired by October 2009, which it did.

But then Metro failed to meet its own promise to have the remaining 27 underground stations complete by October 2010, and some still remain smartphone dead zones for riders. Meanwhile, the 50.5 miles of underground tunnels in between the stations also need to have signals. The act states all work must be complete by Oct. 16.

kweir@washingtonexaminer.com

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