White-Skanska-Kiewit Boston rail line extension likely delayed by cost overruns

Dive Brief:

Massachusetts Transportation Secretary Stephanie Pollack has informed the Massachusetts Department of Transportation (MassDOT) it is unlikely the Green Line light rail extension project in the greater Boston area will be ready by the revised completion date of 2017 and may not even be able to move to its next phase until spring 2016, the Boston Globe reported.
Massachusetts Bay Transportation Authority (MBTA) officials said they are looking for ways to bring extra money to the project and to lower costs, and halting the project is still a possibility.
Pollack told MassDOT board members the MBTA has four auditing firms working to determine the cause of the project’s cost overruns, if they should replace White-Skanska-Kiewit as contractor, and whether the state needs to contribute additional bond money, the Globe reported. The analysis, MBTA officials said, will not exceed $1.5 million.

Dive Insight:

In recent months, MBTA officials announced approximately $1 billion of project cost overruns, which some critics blamed on the maximum price contract given to White-Skanska-Kiewit, allowing the consortium to set a maximum price at each stage of the extension instead of one contract price at the start of the project.

This type of contract, which proponents say is faster and more efficient, differs from the traditional process that involves choosing a construction company based almost entirely on their bid for the total project.

Pollack said of the current problems, "We’ve had to balance the fact that we need to move forward for a variety of reasons with the fact that we obviously do not want to put additional Commonwealth resources at risk until we have a clear path forward on the project."

The state, according to WBUR, is required to complete the project as part of a settlement deal to alleviate the environmental impacts of the "Big Dig" — the Central Artery/Tunnel project through Boston.

State officials expect to present the audit's findings during a Dec. 9 meeting. After the cost overruns were first revealed last month, a representative from White Contracting told the Boston Globe the contractors did not want to make a comment regarding the project, as they were under contract with the transportation authority.