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October 26th, 2011 NIGEL JAQUISS | News Stories
 

The Runaway Bridge Budget

State transportation officials stood by as planning costs for the Interstate 5 Columbia River Crossing ballooned.

Yet David Evans couldn’t finish the work even with a contract that paid more than twice what was originally planned.

On May 2008, Evans delivered the hefty Draft Environmental Impact Statement along with some bad news: The firm had used up the $50 million in less than three years.

And the project was far from finished: David Evans still had to produce the Final Environmental Impact Statement, published September 2010.

The cost of the contract exploded with a startling lack of oversight and public review. 

On May 16, 2008, Doug Ficco, a WashDOT engineer then in charge of the project, submitted a terse four-page memo seeking an additional $45 million for the Evans contract. 

Normally, public agencies are required to seek competitive bids when contract amounts exceed a certain threshold. But to get that money for David Evans, Ficco didn’t need to get new bids from other contractors or even seek legislative approval. He merely had to answer a few brief questions on a WashDOT form. 

Here’s the key question: “Explain why the services were not included in the terms of the original contract?”

“The services were included,” Ficco wrote. “The funding wasn’t.” 

That was his entire answer.

And David Evans got $45 million added to its contract.

Patricia McCaig is both a consultant to David Evans and the adviser to Gov. John Kitzhaber on the CRC project. She isn’t paid by Kitzhaber, but she’s billed David Evans $227,000 so far. McCaig says although the $45 million increase did not require approval of lawmakers or the states’ governors, it wasn’t just rubber-stamped. 

She says project officials wrote the contract to be amended without rebidding if Evans performed well. 

“The caliber and quality of work is evaluated all the way up to the [transportation department] directors,” McCaig says. “I don’t think anybody ever thought you could get to an ROD [Record of Decision] for $50 million. I believe that was just the maximum contract amount WashDOT could sign at the time.”

Portland economist Joe Cortright, a critic of the CRC, says the practice of low-balling the cost of the initial contract and then hiking the price through amendments, or “change orders,” allows agencies to skirt oversight. 

“Why wouldn’t you rebid the contract when you are almost doubling the initial amount?” Cortright asks. “The argument is always that you’ve built relationships that would be lost with a rebid, but that’s not a good excuse.”

Oregon and Washington officials did it again in April 2010, extending the deadline by 18 months. A year after that, they increased David Evans’ contract to $105 million and pushed its life out to December 2012.

Of the total contract, David Evans itself has collected $33 million and has paid the remainder to subcontractors to help with planning. (For a list of how much subcontractors got paid, download it here.)

McCaig and Wylder say mega-projects such as the CRC present many variables.

“The range of alternatives and unanticipated specific challenges, you don’t know them all,” McCaig says. “Being 18 months off on a project like this is actually on time.”

McCaig says it’s unfair to assume that, simply because the CRC blew its planning deadlines as costs grew, the actual building of the bridge will also go over budget and past its deadlines. “It would be like comparing apples and oranges,” she says. 

Cortright says the project’s record makes him skeptical—as does the poor track record of similar mega-projects across the country.

“There aren’t effective mechanisms to hold them accountable when budgets and deadlines are not met,” he adds. 

And the CRC saw its costs explode while doing the easy part: planning. Just wait, he says, until the project actually starts building a massive new bridge, disrupting a freeway that carries 120,000 vehicles per day, and working in the Columbia River under strict rules to protect sensitive salmon habitat.

“Experience should tell us the risk is on the upside in these projects,” Cortright says. “It’s going to take longer and cost more than they say.”  

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