TRANSPORTATION

State Takes Action on Morrison Knudsen: California declared the company in default of its $215-million contract to build passenger rail cars for the state. State Department of Transportation officials said they took the action to protect taxpayers in the event that the Boise, Ida.-based firm files for bankruptcy. The department said it is continuing to work with the company in an attempt to complete delivery of commuter and intercity rail cars. Morrison Knudsen Corp. has a contract to build 113 intercity and commuter rail cars for California. Work on 47 commuter rail cars has been stalled by the company’s financial troubles and problems with its car shell manufacturer in Brazil. The cars would be used on the CalTrain between San Jose and San Francisco and on Southern California Regional Rail Authority trains in the Los Angeles area.