Connector Segment Will Cost 22% More
Thursday, September 4, 2008
The latest contract awarded to build part of the intercounty connector will cost $100 million more than the highest price predicted for that seven-mile section, a sign critics say shows that the project is in danger of exceeding its budget.
The middle segment of the six-lane toll highway between Georgia Avenue and Route 29 was predicted to cost $410 million to $460 million, according to documents on the project's Web site. The agreement, known as Contract B, was awarded July 22 at $559.7 million, 22 percent above the most recent estimates, Maryland highway officials said.
State officials attributed the increase to sharp rises in construction costs affecting the road-building industry. Those include a 35 percent increase in steel and a 105 percent jump in liquid asphalt cement in the past six months, said Valerie Burnette Edgar, a spokeswoman for the Maryland State Highway Administration.
"This wasn't a big surprise," Edgar said. "These types of increases are challenging, but at this point in the project, we're still able to manage it inside the financial plan."
Maryland has two more construction contracts to award on the highway. Their combined cost is an estimated $110 million to $140 million.
The connector's $2.4 billion budget includes a cushion to handle such contingencies, Edgar said. Money also could be saved through "efficiencies" that can be designed into the 18.8-mile highway, she said. Maryland could have money left after it finishes buying the rights of way for the highway because its land acquisition budget was crafted when real estate was more expensive, she said.
Critics say the cost overrun on the latest construction contract proves their argument that the state can't afford the highway.
"We've been saying for several years that a construction-cost estimate issued by the state in 2004 almost certainly can't hold in 2008," said Greg Smith, a longtime anti-connector activist. "There are really clear signs that this project is fiscally unsound and, with the environmental destruction it'll cause, should be terminated."
Cost overruns aren't the only problems highway officials are facing on their latest connector contract. The start date for that construction through northern Silver Spring remains unclear because three construction companies whose slightly lower bid was rejected have filed a protest. That construction, scheduled to begin in fall, can't get underway until the protest is resolved, state highway spokesman David Buck said.
The protest was filed July 30 by a joint venture of Facchina, Trumbull and Skanska construction companies, Buck said. Their bid was just above $559 million. The winning bid submitted by a joint venture of three other companies -- Kiewit, Corman Construction and G.A. & F.C. Wagman -- was $672,000 higher.
Buck said a State Highway Administration procurement officer will decide in a few weeks whether Contract B was properly awarded. He said he couldn't comment on the specifics of the protest because it involves a potential legal matter. The companies that filed the protest could appeal any administrative decision, sue or seek a temporary restraining order in court.
Buck said highway officials took into account each bid's "technical merits," along with price. He said highway officials don't know whether the protest will delay construction.
"Our goal is still to get this underway this fall," Buck said, "but there's no way anyone can guarantee right now how long this is going to take."
Construction on the highway linking Montgomery and Prince George's counties began in November in the western 7.2-mile segment between Interstate 370 in Gaithersburg and Georgia Avenue. That first segment is scheduled to open in 2010. The other sections, extending east to Laurel, are to open in 2012.