Millions in Overruns on MTA Tunnel Feared

Just a week after Congress slashed federal funding for the Los Angeles subway because of past mismanagement, new documents show that the price tag for tunneling through the Santa Monica Mountains is likely to soar over original estimates by at least $14.2 million.

The county transit agency documents also disclose that if cost overruns continue at the current pace, taxpayers’ final bill for twin subway tunnels between Universal City and Hollywood will end up $32.9 million, or 26%, over the original $124.4-million contract.

Money to pay for the first 10% in overruns will come from a contingency fund that the Metropolitan Transportation Authority builds into every contract, according to agency officials.

But officials confirm that the extra costs--some of which have not yet been approved for payment by the agency’s board of directors--will exceed the cross-mountain project’s contingency fund by $6.2 million.

The MTA will then have to dip into another, larger pool set aside for the extension of the subway to the San Fernando Valley, officials said. That account has actually grown over the past three years from $67.5 million to $95 million as engineers have found ways to save money elsewhere in the West’s largest public works project, officials said.

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“Overall our trend in the Valley is to be under budget,” said Stanley Phernambucq, the agency’s construction chief, referring to additional subway expenditures, such as station construction. “I think we are managing the project pretty tightly.”

The $14.2-million overrun does not, however, include any money the agency may ultimately have to pay for the project’s most emblematic problem: A six-week interruption in tunneling that resulted when a contractor’s giant digging machine got stuck in a tricky section of soft shale in July.

Phernambucq said the contractor, Traylor Bros./Frontier-Kemper, has told the MTA it believes the agency should pay for the expensive work stoppage, but has not yet made a formal claim.

“There is speculation, there is debate, and there are negotiations,” said Phernambucq. “I have some experts who say the problem was totally the contractor’s fault--that he bid it, he bought it. I have others who say maybe there’s merit in what he says.”

In the month since the machine was freed, it has dug an average of 35 feet a day. Agency construction officials have said they normally expect contractors to dig 100 feet per day.

Most of the overrun for the cross-mountain tunnel has resulted from changes to excavation procedures demanded by Hollywood Hills homeowners or mandated by a judge in a consent decree.

On Thursday, the MTA board’s construction committee approved its 27th and 28th increases to the contract.

The first change boosted the price by $5.6 million to pay for costs associated with environmentalists’ demand that the tunneling contractor plug up rock fissures with vast amounts of grout to prevent millions of gallons of mountain water from draining into the tunnel. Much of the cost is a result of the MTA’s extension of the contract by 56 days to account for delays that grouting will cause.

The second change boosted the project’s cost by $1.8 million to pay for the mechanical excavation of seven passages between tunnels that the contractor had originally planned to blast out with explosives.

Los Angeles County Supervisor Zev Yaroslavsky, who brokered both changes in talks with Hollywood Hills homeowners and agency officials in the spring, said the changes represent ways in which overruns are sometimes a reflection of the agency’s sensitivity.

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“These are prudent investments, and insurance against possible future adverse impacts,” Yaroslavsky said Thursday.

He added, though, that he believed the changes would have come cheaper had they been part of the original specifications for the job.

“The MTA staff originally thought its engineers were invincible. We had a ‘best and brightest’ syndrome here,” he said. “But now we have learned that they can’t do everything they’ve promised. . . .

“The MTA has taken chances with operations like this in the past and the agency has proven not to be a very sagacious gambler. This time we are eliminating as much risk as possible.”

Last week, a House-Senate appropriations conference committee voted to give Los Angeles less than half the $158 million it had sought for subway construction in 1997. The $70-million allocation represented a compromise between the $55 million that the Senate had appropriated and $90 million earmarked for Los Angeles by the House.

A report issued by House transportation appropriations subcommittee Chairman Frank Wolf castigated the MTA for “irregularities” in the construction and engineering of the $5.8-billion subway project.