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Caltrans criticized for poor management of Bay Bridge project

December 22, 2004 Reposted from the San Francisco Chronicle
  By Terence Chea, Associated Press Writer

The California Department of Transportation failed to adequately manage the ballooning costs of building a new eastern span of the San Francisco-Oakland Bay Bridge, according to a state auditor's report released Wednesday.

The report by State Auditor Elaine Howle found that the estimated cost for Caltrans' Toll Bridge Seismic Retrofit Program, which covers seven state-owned bridges, has risen by $3.2 billion to $8.3 billion since its budget was established April 2001.

Most of the rise came from a $2.5 billion increase for the replacement span of the Bay Bridge, which carries about 275,000 vehicles each day between San Francisco and Oakland.

The cost overruns were attributed to rising prices for construction materials and contractor services, lengthy delays in the construction process and the need to increase contingency funds for unexpected costs.

Howle's report criticized Caltrans for failing to develop a comprehensive plan to track and manage costs and risks associated with building the eastern span, whose price tag has spiraled from $2.6 billion to $5.1 billion.

Caltrans also failed to keep the Legislature informed about cost projections as required by state law, and didn't disclose the cost overruns until August, long after the agency should have known about them, the report said.

"Had it been monitoring the program's costs regularly, Caltrans would have realized much earlier that the program was exceeding its budget," Howle wrote in the 94-page report.

Caltrans officials said they welcomed the report's findings, which they will use to improve the agency's business practices. They pointed out that the report found that all the money was spent properly, and that most of the cost increases were driven by factors outside the agency's control.

Responding to the report, San Francisco Bay area leaders said Caltrans must reform its management practices before the project moves forward.

"It's a scathing criticism of Caltrans for a massive failure in managing this project," said Sen. Tom Torlakson, D-Antioch, who chairs the senate transportation committee. "The report says stop pointing fingers at the Bay Area and stop trying to punish the Bay Area."

Torlakson said the state should pay for 50 percent of the cost overruns since the report shows that Caltrans failed to properly manage the project. The Schwarzenegger administration has said it wants the Bay Area to pay 80 percent of those costs, mostly through increased bridge tolls.

The report comes less than two weeks after Caltrans proposed scrapping plans to replace the Bay Bridge's eastern span with an expensive single-tower suspension bridge that San Francisco Bay area leaders had chosen in 1998. Instead, Caltrans officials favor a towerless concrete skyway -- a plainer bridge that they estimate will save $300 million to $400 million.

The skyway proposal has run into resistance from Bay Area lawmakers who question whether the no-frills bridge can save money and be completed by 2011 or 2012 as Caltrans officials estimate.

Sunny Wright McPeak, Secretary of California's Business, Housing and Transportation Agency, which oversees Caltrans, pointed out that the suspension span contributed to $930 million of the $3.2 billion in increased costs. She said that "signature" span was among the most complex bridges ever designed -- a fact that few appreciated until May when the lone bid came in at double the original estimate.

The Legislature plans to hold hearings starting next month to determine what caused the cost overruns, who should pay the increased costs, how to finance the project, and which bridge design should be built.

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