City Hall

O'Brien Grills Staffers About Tunnel Cost Overruns

By Erica C. Barnett May 17, 2010



City Council member Mike O'Brien got all Maria Cantwell on city and state transportation staffers at this afternoon's discussion of a proposed agreement between the city and the state over the planned Alaskan Way deep-bore tunnel. Like targets of Cantwell's interrogations
, the staffers had a hard time answering his questions. That's in part because they didn't have an answer that would satisfy him—O'Brien wants the city off the hook for cost overruns, and the state doesn't want to make that commitment. Voila: Impasse.

For example, when O'Brien asked directly who would be on the hook in the event of catastrophes like the sinkholes that have plagued the Brightwater tunnel project, viaduct project manager Ron Paananen responded, "It's a little bit of both."

When O'Brien asked directly why the city and state aren't signing off on a bond for the full $800 million it will need to build the tunnel, Paananen responded, "there was a risk that the bonding would result in two or more of the teams [bidding on the tunnel project] dropping out."

And when O'Brien asked directly whether it didn't make sense to move more slowly and get the cost estimates before signing off on an agreement with the state, Paananen responded that delay would cost more than signing off on an incomplete agreement.

Things really got interesting, though, when O'Brien started grilling the planners about which party to the agreement—the city or the state—would be on the hook if things did go haywire.

O'Brien:  I appreciate the thoroughness that the state has gone through in analyzing the contract … [but I'm trying to identify] who’s responsible for which portion. ... What happens if this project goes over $2.8 billion of state money? Nowhere in here do I believe is that addressed specifically. Who would pay if it goes over $2.8 billion?

Paananen: I’m not the right person to answer that question as directly as you'd like. ...  We have what we believe is more than adequate money set aside for risk and contingency. … These agreements will do what they’re intended to do without the provisions you’re looking for."

O'Brien: Can you walk me through… what would technically happen if, say, a building was sinking and  … you get to $2.8 billion? Does everything stop at that point?

Paananen: No. When we sign a contract with a contractor, it’s between the state and that company. We typically respect the responsibility of an agreement that might say otherwise. ... We have a lot of confidence that we can stay within that [$2.8 billion] mark.

O'Brien:  One of the biggest questions for us as elected officials in Seattle is what happens if we get over $2.8 billion. Despite assurances that we think we’re going to be well under that, and it wouldn’t happen, these things tend to get away ... and I think the prudent time for us to address that possibility is now… I would much rather be arguing for the city to protect itself when the argument is purely hypothetical instead of sometime down the road.

While O'Brien seems to have studied Cantwell's performance, his hot-headed mentor Mike McGinn might consider studying O'Brien's.
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