MBTA ignored higher cost estimates for Green Line, says report

Dive Brief:

A previously withheld Berkeley Research Group report found the failure of the Massachusetts Bay Transportation Authority and its independent cost consultant to address the disparity between cost estimates from two major Boston Green Line contractors made conditions ripe for the cost overruns and scheduling delays that have stalled the project, Boston.com reported. The MBTA expects the project will cost nearly $3 billion, exceeding the original budget by $1 billion.
Construction manager White-Skanska-Kiewit's estimate for building costs in December of 2013 was $1.17 billion, but project manager HDR/Gilbane's estimate was $853 million just one month later, according to Boston.com. The Berkeley report said the MBTA ignored WSK's higher estimate and set their own estimate for the total project, including non-construction costs, at $1.99 billion based on HDR/Gilbane's lower number. The MBTA used that figure to apply for federal funds.
Berkeley had previously presented its findings to the MBTA, but Boston.com said it obtained the group's report only after appealing the MBTA's decision to withhold it under public record laws. According to Boston.com, sections of the report remain redacted.

Dive Insight:

The Berkeley report says, "It is clear now that the WSK construction budget should have served as a clear indication that the two parties should have reconciled the differences in the estimates or that a reliable independent check estimate should have been produced."

However, that is not what happened. Instead, the MBTA's independent cost estimator, Stanton Constructability Services, according to Boston.com, told the MBTA and HDR/Gilbane that "construction firms often overestimate costs early and that they would come down as the project advanced."

The Berkeley report said that the MBTA and HDR/Gilbane relied on Stanton's advice and did not investigate the difference between the two estimates, Boston.com reported.

Later, there was a period of finger pointing and project contractors, in particular WSK, were vilified as having taken advantage of the contract procurement process and then terminated.

However, all of this seemed to have happened without the MBTA disclosing the magnitude of its error at the start of the project, an error that seems to be greatly responsible for the Green Line debacle, according to Boston.com.