That generous slush fund built into the Alaskan Way Viaduct replacement project that all but guarantees that it won’t run over budget? It just shrank by quite a bit.
State officials announced this week that they are shifting more than half of the money set aside for risk and inflation to help sweeten one of the project’s contracts.
Potential bidders have been wary of taking on the most troublesome portion of the project: The 1.7-mile, 55-foot-diameter deep-bore tunnel that will link Sodo to South Lake Union.
The number of construction teams in the hunt has dropped from four to two this year. Contractors are nervous about what they might find in the watery and abrasive soils beneath Seattle’s downtown, which one expert described earlier this year as worse than those encountered in Boston’s problem-plagued Big Dig.
To keep the remaining two teams interested, the state Department of Transportation is now offering $230 million in concessions. A big chunk of the money – $100 million – will go toward additional bonds and insurance to address the risky nature of boring project.
The debit will leave the $3.1 billion Alaskan Way project with $235 million in reserves. The state argues that would be plenty to cover extra expenses in the tunnel project, which it expects to account for just less than $2 billion of the total costs.
Perhaps. But the shrinking reserve fund is all the more reason why the state Legislature must continue to defend its 2009 deal on the viaduct.
That’s the deal under which Seattle – in exchange for getting a tunnel rather than a new viaduct or surface option – was required to accept the risk of cost overruns. The same deal that Seattle politicians are trying mightily to undo or outright deny.
The Seattle City Council is fighting Mayor Mike McGinn to keep the project on track, but even the council seems to be operating on the assumption that state lawmakers won’t have the gumption to follow through on billing Seattle property owners should the viaduct project run over budget.
If push comes to shove, the Legislature must do as it said it would: Hold Washington taxpayers’ harmless for Seattle’s insistence that the state go the gold-plated route to replace the quake-damaged viaduct.
Here’s hoping the Department of Transportation’s professed confidence in its risk assessment and cost estimates is well-founded because its margin for error just got smaller.