CA: New bridge phase sees old questions - MTC will take control with costs still unknown

Oakland Tribune ^ | 7/26/05 | Sean Holstege

[NormsRevenge]

Wednesday opens a new chapter in the 16-year Bay Bridge saga, when regional politicians take the reins to oversee the project amid unanswered questions about why the public will pay twice — at unknown cost — for the same work.

Specifically, the Metropolitan Transportation Commission will be asked to approve freshly repackaged bids to build the bridge's tower. Caltrans is expected to advertise the project the next day but has not released an official cost estimate.

MTC's new role results from lengthy negotiations in the Capitol this year and the new law they produced. It means the Bay Area will pay more — in the form of $4 tolls — but will havemore say in controlling costs.

Among MTC's first decisions is what to do about a canceled $177 million contract to build the foundation of the now on-again tower. Caltrans decided in January to tear out a critical part of that work, meaning California taxpayers will pay for the work twice.

The Oakland Tribune requested in late March documents showing who ordered the removal and what it would cost. Two weeks ago, after insisting it had divulged all public records, Caltrans released documents that showed the decision cost more than it had suggested.

The agency still cannot document who was responsible for the decision that resulted in the destruction of one of two huge steel casings, which are used to guide pile-driving.

Initially, in interviews a Caltrans spokesman said the agency's project manager made the call. But other sources within Caltrans told the Tribune and other newspapers at the time that the project manager first learned from newspaper reports that one of steel templates was being chopped up.

In June, Caltrans Director Will Kempton told the Tribune he "signed the termination orders" for the contract as the Schwarzenegger administration pushed to change the bridge design to one without a tower. Kempton said it was up to the contractor, KFM Joint Venture, to decide how to stop the work.

"We thought that given the potential for an early decision (about the bridge design) the most prudent course of action to save money was to terminate the contract," Kempton said.

But none of the newly released documents bear Kempton's name. Instead, most of the Caltrans documents are signed by a subordinate of the project manager.

They allude to a Jan. 5 Caltrans letter terminating the contract, but the letter itself was not released. On Jan. 7, Caltrans directed KFM to remove all temporary structures and provide full estimates of the cost to store steel and the value to scrap it.

On Jan. 18, Caltrans requested KFM "track costs incurred after" the cancellation date "separately." Caltrans did not provide that tally but said in an e-mail that removing the template cost $20,000 to $30,000.

But an inch-thick stack of invoices from KFM's subcontractors and individual cost summaries from KFM appear to show costs much higher.

One shows a $495,000-a-month cost to halt steel fabricators, another shows $5,000 a day in overhead expenses, and a third shows Caltrans paid KFM $458,000 by March and was billed $232,000 more.

Questions about true bridge costs are nothing new; it's one of the main reasons MTC now oversees the $6.3 billion Bay Bridge project.

In December, the state auditor blasted Caltrans for failing to notify state and federal authorities of rising costs.

In January, the Oakland Tribune uncovered Caltrans documents written two months before it opened bids on the bridge tower. In one, an executive summary, the first sentence states "this report serves as notice to the Legislature that ... actual costs exceed the amounts" identified in state law. The document, and others stapled to it, were never sent to lawmakers.

State transportation Secretary Sunne Wright McPeak said in testimony to the Legislature and ever since that she had never seen the documents and never knew the cost of the bridge until the lone bid came back in May 2004.

"It is a description that has never wavered, not one word," McPeak's spokesman Chris Nance said Monday.

But on radio station KQED's Forum show last week, McPeak said: "When we inherited this problem and began looking at the cost increases, consulted the Metropolitan Transportation Commission in February of 2004, and said, 'We are concerned that we're likely to get a bid in May of that year that is going to exceed the budget,' we were even told, 'Well, perhaps we are overreacting to that concern.'"

In a June 30 letter to the Tribune, Nance repeated McPeak's claim that an internal investigation turned up "only a loose compilation of eight separate documents regarding alternative scenarios, as confirmed by the alleged author of this nonexistent report."

The alleged author, Caltrans bridge program manager Dan McElhinney, said in a memo to Kempton the documents were "discussion materials" prepared as contingency planning for the bid.

In a January memo obtained under public records laws, McElhinney stated that the materials were prepared for an April 2004 meeting for the governor's staff. But, now, in a June 29 memo sent to the Tribune, McElhinney said he had "no personal knowledge" of such a meeting until after the bids were opened.

[calcowgirl]

So Kiewit got paid to build it, got paid for the 'stop work', got paid to tear it up,
and now taxpayers will pay again to rebuild it?

Amazing.