oversight

Mass Transit: Status of New Starts Transit Projects With Full Funding Grant Agreements

Published by the Government Accountability Office on 1999-08-19.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                  United States General Accounting Office

GAO               Report to Congressional Requesters




August 1999
                  MASS TRANSIT
                  Status of New Starts
                  Transit Projects With
                  Full Funding Grant
                  Agreements




GAO/RCED-99-240
             United States
GAO          General Accounting Office
             Washington, D.C. 20548

             Resources, Community, and
             Economic Development Division

             B-282805

             August 19, 1999

             Congressional Requesters

             Since the early 1970s, the federal government has provided a large share of
             the nation’s capital investment in urban mass transportation. Much of this
             investment has come through the Federal Transit Administration’s (FTA)
             “new starts” program, which funds up to 80 percent of major new rail and
             bus transit systems that use separate and exclusive rights-of-way, as well
             as extensions to existing systems. FTA has entered into full funding grant
             agreements1 totaling $5.1 billion for 14 new starts transit projects that are
             currently under construction. Approximately $3.2 billion of this $5.1 billion
             has already been appropriated for these projects. Expected to cost a total
             of $8.7 billion when the grant agreements were signed, these projects
             represent a substantial investment of federal, state, and local
             transportation funds.

             Because of your interest in FTA’s new starts transit investments, you asked
             us to assess the progress and cost of these 14 projects in terms of the
             schedule and cost estimates in the grant agreements. As agreed with your
             offices, this report, which includes the information we provided your staff
             in May 1999, describes the status of each project, identifies those projects
             that have experienced changes in their baseline cost estimates, and
             provides information on the reasons for the changes.


             Under the new starts program, FTA uses full funding grant agreements to
Background   commit funding to transit projects. Before entering into a grant agreement,
             FTA assesses a project on the basis of specific financial and project
             justification criteria required by law and the agency’s policy.2 FTA
             considers a project for a grant agreement after it has progressed from the
             initial planning and preliminary engineering phases to the final design and
             construction phases.

             1
              A full funding grant agreement commits federal new starts funding, subject to appropriations, to help
             design and construct transit projects.
             2
              The Transportation Equity Act for the 21st Century (TEA-21), enacted in 1998, requires FTA to evaluate
             and rate new starts projects as either highly recommended, recommended, or not recommended on
             the basis of specific financial and project justification criteria and to include this information in its
             new starts report due to the Congress each February. At the same time, TEA-21 specifically exempts,
             from the rating requirement, projects that had full funding grant agreements in place prior to the act.
             These are the 14 projects we reviewed. According to FTA, these projects were assessed and found to
             be justified on the basis of information required by the laws and policies in place at the time the grant
             agreements were issued. See our report entitled Mass Transit: FTA’s Progress in Developing and
             Implementing a New Starts Evaluation Process (GAO/RCED-99-113, Apr. 26, 1999) for a discussion of
             FTA’s progress in developing an evaluation and rating process that reflects TEA-21’s requirements.



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                   B-282805




                   Through the grant agreement, FTA establishes the terms and conditions of
                   federal financial participation in a project as well as the maximum level of
                   federal financial assistance. FTA pays up to 80 percent of a project’s net
                   cost, while state and local governments pay at least 20 percent. The federal
                   funding commitments are subject to the annual appropriations process.
                   The grant agreement also defines a project’s scope, including the length of
                   the system and the number of stations; its schedule, including the date
                   when the system is expected to open for service; and its cost. To oversee
                   each project, FTA uses a project management oversight contractor to help
                   ensure that the project progresses on time, within budget, and in
                   conformance with approved plans. Given that the full funding grant
                   agreement limits the maximum federal funding for a project, the grantee is
                   responsible for any project cost increases that may occur after the
                   agreement is signed, unless the agreement is amended.

                   The 14 projects we reviewed have full funding grant agreements. FTA has
                   proposed that these projects receive $668.2 million in fiscal year 2000. This
                   is 68 percent of the total $980.4 million available for new starts projects in
                   fiscal year 2000.3 If the Congress appropriates the amounts proposed by
                   FTA, the federal funding commitments for five of these projects would be
                   complete in fiscal year 2000.


                   Of the 14 transit projects with full funding grant agreements, 6 had
Results in Brief   experienced cost increases as of May 1999. Half of these six projects have
                   had cost increases ranging from 2 to 7 percent;4 of these, two are not
                   expected to meet their projected opening dates. The other half have
                   experienced costs that are significantly higher than expected—more than
                   25 percent over the estimates approved by FTA in the grant agreements.
                   The key reasons for the cost increases include (1) higher-than-anticipated
                   contract costs, (2) schedule delays, and (3) project scope changes and
                   system enhancements. These three projects are not expected to meet their
                   originally projected opening dates. Of the eight remaining projects, three


                   3
                     The $980.4 million total is the amount of new starts funding subject to the “guarantee” in TEA-21, a
                   procedural mechanism designed to ensure that minimum amounts of funding are provided each year
                   for highway and mass transit programs. Of the remaining 32 percent ($312.2 million) available for new
                   starts projects, FTA recommended about $248 million for 11 projects in the later stages of preliminary
                   engineering. Seven of these projects are expected to enter final design by the beginning of fiscal year
                   2000. About $46 million remains available for FTA to allocate among other projects currently in or
                   approved to enter preliminary engineering by the end of fiscal year 2000. The balance has been set
                   aside for special projects and project management oversight activities.
                   4
                    As discussed in appendix II, one of the three grantees, the Metropolitan Atlanta Rapid Transit
                   Authority, is seeking additional new starts funding to cover the cost increase experienced by the North
                   Line extension project in Atlanta.



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    B-282805




    could potentially experience costs that are lower than expected, and the
    other five are expected to be completed within their approved budgets.
    Only one of these eight projects is not expected to meet its projected
    opening date.

    For those projects with significant cost increases, we found the following:

•   The South Boston Piers transitway project, which has some joint
    construction with the Central Artery/Tunnel project in Boston—one of the
    most expensive and complex highway projects ever undertaken—has
    experienced a net cost increase of $115 million, or 28 percent of the
    estimated cost of $413.4 million in the grant agreement. FTA, its oversight
    contractor, and the grantee attribute the cost increase primarily to an
    estimate based on the project’s early design, which has since required
    modification, and unanticipated delays in the construction schedule. The
    construction delays were due in part to coordination problems on the joint
    construction contracts with the Central Artery/Tunnel project. The
    transitway is expected to open for service on December 31, 2002, 2 years
    later than the date in the grant agreement. Both FTA and the oversight
    contractor estimate that the transitway’s cost could increase by an
    additional $20 million to $80 million because of pending issues such as
    potentially higher-than-expected contract costs for the project’s last major
    segment and the grantee’s decision to build a new vehicle maintenance
    facility or to expand an existing one. However, FTA does not plan to amend
    the full funding grant agreement to commit additional new starts funds to
    cover the cost increases. To pay for the cost increases, the grantee is
    proposing to use both federal formula funds5 and state funds. FTA is using a
    financial management oversight contractor to review the grantee’s
    proposal and its effect on the existing transit system.

•   The Bay Area Rapid Transit’s (BART) project to construct an extension of
    its existing system to the San Francisco International Airport has
    experienced a net cost increase of $316.2 million, or 27 percent of the
    estimated cost of $1.2 billion in the grant agreement. Of this amount, BART
    officials attributed more than half, or $165.5 million, to
    higher-than-expected construction costs that resulted primarily from a
    very competitive Bay Area economy. While the grant agreement calls for a
    September 2001 opening date, BART officials now forecast that the airport
    extension will open 3 months later. However, FTA’s project management
    oversight contractor has estimated that the opening could be as late as

    5
     TEA-21   also authorized capital funds for urbanized areas on a formula rather than a project-specific
    basis.



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                      B-282805




                      June 2002 and that the cost of the project could grow by an additional
                      $53 million for work on the airport station and added contingencies. FTA is
                      reviewing the project’s revised cost estimates and BART’s proposal to cover
                      some of the additional costs with $30 million in new starts funds originally
                      budgeted for acquiring rail cars that would become available if BART
                      canceled its planned $100 million purchase of rail cars. BART has proposed
                      to spend the remaining $70 million on improving its vehicle maintenance
                      facility rather than acquiring rail cars. FTA has no plans to amend the full
                      funding grant agreement to commit additional new starts funds to cover
                      the project’s cost increases.

                  •   The Tren Urbano rapid rail line in San Juan, Puerto Rico, is one of FTA’s
                      “turnkey” demonstration projects that incorporates contracts to design,
                      build, operate, and maintain a system. Currently under construction, this
                      project has experienced a net cost increase of $426 million, or 34 percent
                      of the $1.25 billion estimated cost in the grant agreement. Among the
                      primary factors contributing to the cost increase are changes in the
                      project’s scope, including the addition of two stations, certain station and
                      system enhancements, and higher-than-estimated contract costs. The rail
                      line is expected to open for service in May 2002—10 months later than the
                      date in the grant agreement. FTA is conducting a financial capacity review
                      of the grantee—the Puerto Rico Highway and Transportation Authority—to
                      help ensure that adequate funding is available to build and maintain the
                      project without adversely affecting the area’s other transportation needs.
                      FTA has no plans to amend the full funding grant agreement to commit
                      additional new starts funds to cover the project’s cost increase.

                      A summary of the status and cost of each project we reviewed appears in
                      appendix I. Appendixes II through XV provide detailed information on
                      each project.


                      We provided the Department of Transportation with a draft of this report
Agency Comments       for review and comment. We met with FTA officials from the Office of
                      Associate Administrator for Program Management, including officials from
                      the Offices of Oversight and Engineering. FTA agreed with the report’s
                      contents and provided us with minor technical comments, which we have
                      incorporated where appropriate.


                      To address the issues discussed in this report, we reviewed
Scope and             project-specific documents, including the full funding grant agreements
Methodology

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and project management oversight reports. To obtain funding information,
we reviewed FTA’s new starts report for fiscal year 2000. We also
interviewed appropriate FTA headquarters and regional officials, FTA
contractors responsible for overseeing the projects, and the grantees. We
did not perform an independent assessment of the reasons for the cost
increases. Rather, we relied on the information provided by FTA officials,
FTA’s contractors, and the grantees. We performed our work in accordance
with generally accepted government auditing standards from April through
July 1999.


We are sending copies of this report to the Honorable Rodney E. Slater,
Secretary of Transportation; the Honorable Gordon J. Linton,
Administrator, Federal Transit Administration; the Honorable Jacob J.
Lew, Director, Office of Management and Budget; and other interested
parties. We are making copies available to others on request.

Key contributors to this report are listed in appendix XVI. Please call me at
(202) 512-2834 if you have any questions about this report.




Phyllis F. Scheinberg
Associate Director,
Transportation Issues




Page 5                                GAO/RCED-99-240 New Starts Transit Projects
B-282805




List of Requesters

The Honorable Phil Gramm
Chairman, Committee on Banking,
  Housing, and Urban Affairs
United States Senate

The Honorable Richard C. Shelby
Chairman, Subcommittee on Transportation
  and Related Agencies
Committee on Appropriations
United States Senate

The Honorable Bud Shuster
Chairman, Committee on Transportation
  and Infrastructure
House of Representatives

The Honorable Frank R. Wolf
Chairman, Subcommittee on Transportation
  and Related Agencies
Committee on Appropriations
House of Representatives




Page 6                            GAO/RCED-99-240 New Starts Transit Projects
Page 7   GAO/RCED-99-240 New Starts Transit Projects
Contents



Letter                                                                                              1


Appendix I                                                                                         12

Summary of New
Starts Transit Projects
With Full Funding
Grant Agreements
Appendix II                                                                                        13
                          Project Description and Status                                           13
Atlanta/North Line        Reasons for Cost Increases                                               13
Extension                 Pending Issues                                                           14

Appendix III                                                                                       15
                          Project Description and Status                                           15
Boston/South Boston       Reasons for Cost Increases                                               15
Piers Transitway          Pending Issues                                                           16

Appendix IV                                                                                        17
                          Project Description and Status                                           17
Denver/Southwest          Pending Issues                                                           17
Light Rail Extension
Appendix V                                                                                         18
                          Project Description and Status                                           18
Houston/Regional Bus      Reasons for Cost Increases                                               18
Plan
Appendix VI                                                                                        20
                          Project Description and Status                                           20
Los Angeles/North         Pending Issues                                                           20
Hollywood Extension




                          Page 8                           GAO/RCED-99-240 New Starts Transit Projects
                        Contents




Appendix VII                                                                                     21
                        Project Description and Status                                           21
Maryland/MARC           Reasons for Cost Increases                                               21
Extension to            Pending Issues                                                           22
Frederick and System
Improvements
Appendix VIII                                                                                    23
                        Project Description and Status                                           23
Northern New            Pending Issues                                                           23
Jersey/Hudson-Bergen
Waterfront Light Rail
Line
Appendix IX                                                                                      25
                        Project Description and Status                                           25
Portland/Westside       Pending Issues                                                           25
Light Rail Extension
to Hillsboro
Appendix X                                                                                       26
                        Project Description and Status                                           26
Sacramento/South        Pending Issues                                                           26
Corridor Light Rail
Line
Appendix XI                                                                                      27
                        Project Description and Status                                           27
Salt Lake City/South    Pending Issues                                                           27
Light Rail Line
Appendix XII                                                                                     29
                        Project Description and Status                                           29
San Francisco/BART      Reasons for Cost Increases                                               29
Airport Extension       Pending Issues                                                           30




                        Page 9                           GAO/RCED-99-240 New Starts Transit Projects
                       Contents




Appendix XIII                                                                                   31
                       Project Description and Status                                           31
San Jose/Tasman        Pending Issues                                                           31
Light Rail West
Extension
Appendix XIV                                                                                    32
                       Project Description and Status                                           32
San Juan/Tren Urbano   Reasons for Cost Increases                                               32
Rapid Rail Line        Pending Issues                                                           33

Appendix XV                                                                                     34
                       Project Description and Status                                           34
St. Louis/St. Clair    Pending Issues                                                           34
County Light Rail
Extension
Appendix XVI                                                                                    35
                       GAO Contacts                                                             35
GAO Contacts and       Acknowledgments                                                          35
Staff
Acknowledgments
Tables                 Table I.1: Summary of New Starts Transit Projects With Full              12
                        Funding Grant Agreements as of May 1999
                       Table II.1: Atlanta/North Line Extension—Estimated Cost and              13
                        Status of Federal Financial Support as of May 1999
                       Table III.1: Boston/South Boston Piers Transitway—Estimated              15
                        Cost and Status of Federal Financial Support as of May 1999
                       Table IV.1: Denver/Southwest Light Rail Extension—Estimated              17
                        Cost and Status of Federal Financial Support as of May 1999
                       Table V.1: Houston/Regional Bus Plan—Estimated Cost and                  18
                        Status of Federal Financial Support as of May 1999
                       Table VI.1: Los Angeles/North Hollywood Extension—Estimated              20
                        Cost and Status of Federal Financial Support as of May 1999
                       Table VII.1: Maryland/MARC Extension to Frederick and System             21
                        Improvements—Estimated Cost and Status of Federal Financial
                        Support as of May 1999




                       Page 10                          GAO/RCED-99-240 New Starts Transit Projects
Contents




Table VIII.1: Northern New Jersey/Hudson-Bergen Waterfront                  23
 Light Rail Line—Estimated Cost and Status of Federal Financial
 Support as of May 1999
Table IX.1: Portland/Westside Light Rail Extension to                       25
 Hillsboro—Estimated Cost and Status of Federal Financial
 Support as of May 1999
Table X.1: Sacramento/South Corridor Light Rail                             26
 Line—Estimated Cost and Status of Federal Financial Support as
 of May 1999
Table XI.1: Salt Lake City/South Light Rail Line—Estimated Cost             27
 and Status of Federal Financial Support as of May 1999
Table XII.1: San Francisco/BART Airport Extension—Estimated                 29
 Cost and Status of Federal Financial Support as of May 1999
Table XIII.1: San Jose/Tasman Light Rail West                               31
 Extension—Estimated Cost and Status of Federal Financial
 Support as of May 1999
Table XIV.1: San Juan/Tren Urbano Rapid Rail Line—Estimated                 32
 Cost and Status of Federal Financial Support as of May 1999
Table XV.1: St. Louis/St. Clair County Light Rail                           34
 Extension—Estimated Cost and Status of Federal Financial
 Support as of May 1999

Abbreviations

BART         Bay Area Rapid Transit
Bi-State     Bi-State Development Agency
FONSI        Finding of No Significant Impact
FTA          Federal Transit Administration
HOV          high-occupancy-vehicle
HTA          Puerto Rico Highway and Transportation Authority
MARC         Maryland Commuter Rail
MARTA        Metropolitan Atlanta Rapid Transit Authority
MBTA         Massachusetts Bay Transportation Authority
MOS          “minimum operable segments”
MTA          Metropolitan Transportation Authority of Los Angeles
MTA          Mass Transit Administration of Maryland
NJ Transit   New Jersey Transit Corporation
RT           Sacramento Regional Transit District
RTD          Regional Transportation District
SCCTD        Santa Clara County Transit District
TEA-21       Transportation Equity Act for the 21st Century
Tri-Met      Tri-County Metropolitan Transportation District
UTA          Utah Transit Authority


Page 11                             GAO/RCED-99-240 New Starts Transit Projects
Appendix I

Summary of New Starts Transit Projects
With Full Funding Grant Agreements

                                                Table I.1 shows the cost changes and opening dates projected for the 14
                                                new starts projects with full funding grant agreements as of May 1999.


Table I.1: Summary of New Starts Transit Projects With Full Funding Grant Agreements as of May 1999
Dollars in millions
                                                                 Revised
                                      Date of       Baseline      grantee   Amount of                Total amount     Projected
                                        grant           cost         cost   estimated     Percent          of grant    opening
New Starts Project                 agreement        estimate     estimate    increase    increase      agreement           date
Atlanta/North Line Extension         12/20/94         $ 381.3      $407.4       $26.1            7          $305.0     12/16/00
Boston/South Boston Piers
Transitway                            11/5/94          413.4        528.4       115.0           28           330.7     12/31/02
Denver/Southwest Light Rail
Extension                              5/9/96          176.3                                                 120.0      7/14/00
Houston/Regional Bus Plan            12/30/94          726.6        780.1        53.5            7           500.0     12/31/05
Los Angeles/North Hollywood
Extension                              6/9/97         1,310.8                                                681.0      5/31/00
Maryland/MARC Extension to
Fredrick                              6/19/95          131.6        134.2         2.6            2           105.3      3/31/01
Northern New
Jersey/Hudson-Bergen                 10/15/96          992.1                                                 604.1      7/31/01
Portland/Westside Light Rail
Extension                             9/29/92          963.5                                                 630.1      9/12/98
Sacramento/South Corridor
Light Rail Line                       6/20/97          222.0                                                 111.2      9/30/03
Salt Lake City/South Light Rail
Line                                   8/2/95          312.5                                                 237.4       3/3/00
San Francisco/BART Airport
Extension                             6/30/97         1,167.0     1,483.2       316.2           27           750.0      6/30/02
San Jose/Tasman Light Rail
West Extension                         7/2/96          325.0                                                 182.8     12/20/99
San Juan/Tren Urbano Rapid
Rail Line                             3/13/96         1,250.0     1,676.0       426.0           34           307.4      5/31/02
St. Louis/St. Clair County Light
Rail Extension                       10/17/96          339.2                                                 243.9      9/30/01
Total                                                $8,711.3                                             $5,108.9




                                            Page 12                                 GAO/RCED-99-240 New Starts Transit Projects
Appendix II

Atlanta/North Line Extension


                                          The Metropolitan Atlanta Rapid Transit Authority (MARTA) is constructing a
Project Description                       2.3-mile, two-station extension of the North Line from the Dunwoody
and Status                                Station to North Springs. When completed, this extension will serve the
                                          area north of Atlanta, which includes Perimeter Center and north Fulton
                                          County, and will connect this area with the rest of the region by providing
                                          transit service for both commuters and inner-city residents traveling to
                                          expanding job opportunities. The full funding grant agreement was signed
                                          on December 20, 1994. Overall construction is progressing on schedule
                                          with no major issues of schedule and quality. As of May 1999, the project
                                          was expected to open for service on December 16, 2000, the date
                                          scheduled in the grant agreement. However, as of May 1999, the estimated
                                          cost of the project was revised upward to $407.4 million, $26.1 million
                                          more than the original baseline estimate approved in the grant agreement.
                                          MARTA is seeking additional new starts funding to cover this increase as
                                          well as the cost of additional vehicles.

                                          Table II.1 shows the change in the project’s estimated cost, the amount of
                                          federal funding provided in the past, the amount proposed by the Federal
                                          Transit Administration (FTA) for fiscal year 2000, and the project’s
                                          estimated opening date.


Table II.1: Atlanta/North Line Extension—Estimated Cost and Status of Federal Financial Support as of May 1999
Dollars in millions
                                                                                                               Amount
                         Amount                  Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total     be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant    through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount           1999             1999            1999          FY 2000    granta                date
$381.3           $407.4      $26.1     $305.0         $260.8          $249.9            $10.0            $45.1        $10.0        12/16/00
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: MARTA-FTA full funding grant agreement, project management oversight data, and
                                          FTA’s fiscal year 2000 annual new starts report.




                                          According to FTA, the project management oversight contractor, and the
Reasons for Cost                          grantee, the estimated $26.1 million cost increase is due primarily to
Increases


                                          Page 13                                          GAO/RCED-99-240 New Starts Transit Projects
                 Appendix II
                 Atlanta/North Line Extension




                 station parking enhancements and the impacts on the project’s
                 right-of-way from the proposed widening of an adjacent freeway.


                 MARTA  is seeking new starts funding for the purchase of an additional 28
Pending Issues   vehicles that are expected to add $55.8 million to the cost of the project.
                 MARTA has initiated negotiations with FTA for an amendment to the grant
                 agreement to cover both the $26.1 million for the scope changes and the
                 $55.8 million for the additional vehicles. The Transportation Equity Act for
                 the 21st Century authorized new starts funding for the project’s scope
                 changes, including the purchase of the 28 additional rapid rail cars, from
                 amounts authorized by the Intermodal Surface Transportation Efficiency
                 Act of 1991. FTA is reviewing MARTA’s revised fleet management plan that
                 addresses the need for these vehicles.




                 Page 14                              GAO/RCED-99-240 New Starts Transit Projects
Appendix III

Boston/South Boston Piers Transitway


                                          Developed by the Massachusetts Bay Transportation Authority (MBTA), this
Project Description                       project, which is to be constructed in two phases, is a 1.5-mile
and Status                                underground transitway with five stations that will connect three existing
                                          transit systems in the South Boston Piers area. The full funding grant
                                          agreement, signed on November 5, 1994, is for phase 1, which consists of a
                                          1-mile, three-station tunnel between South Station and the World Trade
                                          Center. Phase 1 also includes the procurement of 32 vehicles and the
                                          construction of a new vehicle maintenance facility. Part of the
                                          construction has been planned and designed with the Central
                                          Artery/Tunnel highway project. As of May 1999, the transitway project was
                                          expected to open for service on December 31, 2002—2 years later than the
                                          projected date in the grant agreement. Additionally, the estimated cost of
                                          the project was revised upward to $528.4 million—$115 million more than
                                          the original baseline estimate approved in the grant agreement. FTA is
                                          reviewing the grantee’s latest cost recovery plan dated January 1999. A
                                          number of pending issues could affect the total cost of the project.

                                          Table III.1 shows the change in the project’s estimated cost, the amount of
                                          federal funding provided in the past, the amount proposed by FTA for fiscal
                                          year 2000, and the project’s estimated opening date.


Table III.1: Boston/South Boston Piers Transitway—Estimated Cost and Status of Federal Financial Support as of May 1999
Dollars in millions
                                                                                                               Amount
                          Amount                 Amount to          Amount          Funding            FTA’s required
Baseline       Revised         of      Total     be funded         provided         shortfall       proposed        to           Projected
cost            grantee estimated      grant    through FY       through FY      through FY       funding for complete            opening
estimate       estimate increase     amount           1999             1999            1999          FY 2000    granta                date
$413.4          $528.4     $115.0     $330.7          $276.8          $241.9            $34.9            $54.0        $34.9        12/31/02
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: MBTA-FTA full funding grant agreement, project management oversight report data, and
                                          FTA’s fiscal year 2000 annual new starts report.




                                          According to FTA, the project management oversight contractor, and MBTA,
Reasons for Cost                          the estimated net cost increase of $115 million is primarily the result of
Increases                                 schedule delays and the fact that the original baseline cost estimate was




                                          Page 15                                          GAO/RCED-99-240 New Starts Transit Projects
                 Appendix III
                 Boston/South Boston Piers Transitway




                 based on the project’s early design, which has since required modification.
                 Factors contributing to these delays included coordination problems on
                 the joint construction contracts with the Central Artery/Tunnel project,
                 complications with the design for relocating utilities, and differing site
                 conditions. Land acquisition costs have also been higher than originally
                 estimated. According to MBTA, not meeting the federal funding schedule in
                 the grant agreement did not contribute to the project’s cost increase and
                 construction delays.


                 According to FTA and the project management oversight contractor, issues
Pending Issues   that could increase the project’s cost by an additional $20 million to
                 $80 million include (1) potentially higher-than-anticipated contract costs
                 to construct the last major segment of the transitway tunnel, (2) the
                 decision of whether to build a new vehicle maintenance facility or expand
                 an existing one, (3) a local agency’s participation in raising capital for
                 eight vehicles, (4) a higher-than-anticipated unit cost for the vehicles, and
                 (5) potential additional land acquisition costs. FTA expects the first four
                 issues to be resolved by the first quarter of fiscal year 2000. FTA also
                 expects MBTA to update its cost recovery plan once these issues are
                 resolved.

                 To pay for the cost increases, MBTA is seeking to use both federal formula
                 funds and state funds. Currently, FTA is using a financial management
                 oversight contractor to review MBTA’s financial plan. This plan addresses
                 the funding of all of the grantee’s transit projects and systems. According
                 to FTA, this review will enable the agency to determine whether the
                 grantee’s proposal to use formula funds to cover the cost increases would
                 adversely affect the existing transit system. As an alternative, the grantee
                 believes that it has sufficient resources to use state bond funds to pay for
                 any cost increases. FTA has no plans to amend the grant agreement to
                 commit additional new starts funds to the project.




                 Page 16                                GAO/RCED-99-240 New Starts Transit Projects
Appendix IV

Denver/Southwest Light Rail Extension


                                          The Regional Transportation District (RTD) in Denver is constructing an
Project Description                       8.7-mile light rail extension between Denver and Littleton. The
and Status                                double-track line extends from the I-25/Broadway Station on the existing
                                          Central Corridor line to Mineral Avenue in Littleton, running parallel to
                                          Santa Fe Drive over an exclusive, grade-separated right-of-way. The full
                                          funding grant agreement was signed on May 9, 1996. As of May 1999, the
                                          project was expected to open as scheduled on July 14, 2000. Recent
                                          discussions with FTA confirmed that the project should open on or before
                                          that date.

                                          Table IV.1 shows the changes in the project’s estimated cost, the amount
                                          of federal funding provided in the past, the amount proposed by FTA for
                                          fiscal year 2000, and the project’s estimated opening date.


Table IV.1: Denver/Southwest Light Rail Extension—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                               Amount
                         Amount                  Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total     be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant    through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount           1999             1999            1999          FY 2000    granta                date
$176.3                                $120.0            $73.0           $65.5            $7.5            $35.0        $19.5         7/14/00
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: RTD-FTA full funding grant agreement, project management oversight report data, and
                                          FTA’s fiscal year 2000 annual new starts report.




                                          According to FTA and the project management oversight contractor, the
Pending Issues                            only outstanding issue concerns potential defects in some girders.
                                          According to one FTA official, only one installed girder has been found to
                                          be defective so far. The engineers involved on the project do not believe
                                          that this will affect the projected opening date.




                                          Page 17                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix V

Houston/Regional Bus Plan


                                         Houston Metro’s $1 billion Regional Bus Plan consists of a package of
Project Description                      improvements to its existing bus system. The package includes new and
and Status                               extended high-occupancy-vehicle (HOV) facilities and ramps, several transit
                                         centers and park-and-ride lots, bus acquisitions, bus service expansion,
                                         and supporting facilities. The Regional Bus Plan has both a federal and
                                         local component. The full funding grant agreement, signed on December
                                         30, 1994, covers only the federal component of the project. As of May 1999,
                                         the projected opening date was December 31, 2005, or 3 years beyond the
                                         date specified in the grant agreement.

                                         Table V.1 shows the change in the project’s estimated costs, the amount of
                                         federal funding provided in the past, the amount proposed by FTA for fiscal
                                         year 2000, and the project’s estimated opening date.


Table V.1: Houston/Regional Bus Plan—Estimated Cost and Status of Federal Financial Support as of May 1999
Dollars in millions
                                                                                                              Amount
                         Amount                 Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of      Total     be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated      grant    through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase     amount           1999             1999            1999          FY 2000    granta                date
$726.6          $780.1      $53.5    $500.0          $447.2          $437.5             $9.7            $62.5 Complete            12/31/05
                                         Legend

                                         FY = fiscal year
                                         a
                                          Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                         year 2000 is appropriated.

                                         Sources: Houston Metro-FTA full funding grant agreement, project management oversight report
                                         data, and FTA’s fiscal year 2000 annual new starts report.




                                         The $53.47 million dollar increase in the federal component of the project
Reasons for Cost                         is due primarily to a 2-year delay resulting from local contractors’
Increases                                challenging the constitutionality of Houston Metro’s Disadvantaged
                                         Business Enterprise program. In 1997, the program was held
                                         unconstitutional, and Metro is currently appealing the decision. While the
                                         federal component of the project has increased, the cost of the overall
                                         project has remained constant at $1 billion because the cost of the local
                                         component has decreased. According to Houston Metro, not meeting the
                                         funding schedule in the grant agreement did not affect the project or
                                         contribute to cost increases.




                                         Page 18                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix V
Houston/Regional Bus Plan




FTA is reviewing Houston Metro’s request to amend the grant agreement.
The amendment would officially extend the opening date to December 31,
2005, and adjust the budget to reflect the current cost estimate. The
amount of federal participation—$500 million—would not change.




Page 19                            GAO/RCED-99-240 New Starts Transit Projects
Appendix VI

Los Angeles/North Hollywood Extension


                                         The Metro Rail Red Line project in Los Angeles is being implemented
Project Description                      through a series of “minimum operable segments” (MOS). A full funding
and Status                               grant agreement was signed on June 9, 1997, for the MOS-3 North
                                         Hollywood extension. This extension is currently under construction and
                                         is about 1 year from completion. The MOS-3 covers two additional
                                         extensions—East Side and Mid-City. Work on these two extensions has
                                         been suspended indefinitely. The Los Angeles Metropolitan Transportation
                                         Authority (MTA) is currently conducting a study on the corridors in which
                                         the segments were located. FTA officials are unsure of when, or if, work
                                         will resume on the two suspended segments.

                                         Table VI.1 shows the change in the project’s estimated cost, the amount of
                                         federal funding provided in the past, the amount proposed by FTA for fiscal
                                         year 2000, and the project’s estimated opening date.


Table VI.1: Los Angeles/North Hollywood Extension—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                              Amount
                         Amount                                    Amount          Funding            FTA’s required
Baseline      Revised         of       Total      Amount to       provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant      be funded     through FY      through FY       funding for complete            opening
estimate      estimate increase      amount      through FY           1999            1999          FY 2000    granta                date
$1,310.8                              $681.0         $571.7          $532.8            $38.9            $50.0        $98.3         5/31/00
                                         Legend

                                         FY = fiscal year
                                         a
                                          Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                         year 2000 is appropriated.

                                         Sources: MTA-FTA full funding grant agreement, project management oversight report data, and
                                         FTA’s fiscal year 2000 annual new starts report.




                                         FTA’sfinancial management oversight contractor is studying all of MTA’s
Pending Issues                           operations and related financing. The grantee’s current cost estimate for
                                         North Hollywood does not include an additional $33.9 million in
                                         modifications that are beyond the scope approved in the grant agreement.
                                         According to FTA officials, the costs associated with these changes must be
                                         borne by the grantee because the changes are outside of the project’s
                                         approved scope. According to FTA, the project is being completed within
                                         budget and is projected to open in May 2000—7 months earlier than
                                         projected in the agreement.



                                         Page 20                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix VII

Maryland/MARC Extension to Frederick and
System Improvements

                                        The Mass Transit Administration of Maryland (MTA) is extending the
Project Description                     Maryland Commuter Rail (MARC) system from Point of Rocks to Frederick,
and Status                              Maryland. The extension will operate on about 13 miles of rail right-of-way
                                        owned by CSX Transportation. The full funding grant agreement provides
                                        for track, signal, and other improvements; the construction of 2 new
                                        stations; the acquisition of real estate, including 3.4 miles of right-of-way
                                        from CSX; and the procurement of up to 59 new bi-level cars and up to 6
                                        new locomotives. The grant agreement was signed on June 19, 1995, and
                                        projected an opening date of December 1998. However, as of May 1999,
                                        the project was more than 2 years behind schedule primarily because of
                                        prolonged negotiations between MTA and CSX over the purchase of the 3.4
                                        miles of right-of-way.

                                        Table VII.1 shows the change in the project’s estimated cost, the amount of
                                        federal funding provided in the past, the amount proposed by FTA for fiscal
                                        year 2000, and the project’s estimated opening date.


Table VII.1: Maryland/MARC Extension to Frederick and System Improvements—Estimated Cost and Status of Federal
Financial Support as of May 1999
Dollars in millions
                                                                                                             Amount
                          Amount               Amount to          Amount          Funding            FTA’s required
Baseline       Revised         of     Total    be funded         provided         shortfall       proposed        to           Projected
cost            grantee estimated     grant   through FY       through FY      through FY       funding for complete            opening
estimate       estimate increase    amount          1999             1999            1999          FY 2000    granta                date
$131.6          $134.2       $2.6    $105.3         $105.3          $104.6            $0.70            $0.70 Complete             3/31/01
                                        Legend

                                        FY = fiscal year
                                        a
                                         Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                        year 2000 is appropriated.

                                        Sources: Maryland MTA-FTA full funding grant agreement, project management oversight report
                                        data, and FTA’s fiscal year 2000 annual new starts report.




                                        According to FTA and the project management oversight contractor, the
Reasons for Cost                        increase of $2.6 million in the cost of the project is primarily due to the
Increases                               prolonged negotiations between MTA and CSX over the purchase of the 3.4
                                        miles of right-of-way.




                                        Page 21                                          GAO/RCED-99-240 New Starts Transit Projects
                 Appendix VII
                 Maryland/MARC Extension to Frederick and
                 System Improvements




                 According to the project management oversight contractor, at the current
Pending Issues   rate of progress, an opening date of late summer 2001 appears to be more
                 reasonable than the date currently projected. Construction bids for the
                 project are expected to be opened in early August 1999. The awards will
                 provide an indication of whether the cost of the project could increase
                 further.




                 Page 22                                    GAO/RCED-99-240 New Starts Transit Projects
Appendix VIII

Northern New Jersey/Hudson-Bergen
Waterfront Light Rail Line

                                         The New Jersey Transit Corporation (NJ Transit) is constructing a
Project Description                      9.6-mile, 16-station light rail line along the Hudson River Waterfront in
and Status                               Hudson County, from the Hoboken Terminal to 34th Street in Bayonne and
                                         Westside Avenue in Jersey City. This line is intended as the “initial
                                         operating segment” of a larger 21-mile, 30-station line extending from the
                                         Vince Lombardi park-and-ride lot in Bergen County to Bayonne, passing
                                         through Port Imperial in Weehauken, Hoboken, and Jersey City. The full
                                         funding grant agreement was signed on October 15, 1996. The initial
                                         operating segment has been broken down further into two segments
                                         because of a locally approved alignment change. As of May 1999, the first
                                         segment was expected to open for service in March 2000. However, the
                                         remaining segment where the alignment change occurred is not expected
                                         to open until July 2001—1 year beyond the date projected in the grant
                                         agreement.

                                         Table VIII.1 shows the change in the project’s estimated cost, the amount
                                         of federal funding provided in the past, the amount proposed by FTA for
                                         fiscal year 2000, and the project’s estimated opening date.


Table VIII.1: Northern New Jersey/Hudson-Bergen Waterfront Light Rail Line—Estimated Cost and Status of Federal
Financial Support as of May 1999
Dollars in millions
                                                                                                              Amount
                         Amount                 Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total    be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant   through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount          1999             1999            1999          FY 2000    granta                date
$992.1                                $604.1         $233.0          $228.3             $4.7            $99.0      $276.8          7/31/01
                                         Legend

                                         FY = fiscal year
                                         a
                                          Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                         year 2000 is appropriated.

                                         Sources: NJ Transit-FTA full funding grant agreement, project management oversight report data,
                                         and FTA’s fiscal year 2000 annual new starts report.




                                         This project could experience a cost decrease because of reduced
Pending Issues                           financing costs for the rail cars and locally approved alignment changes
                                         that have reduced the number of stations. The project management
                                         oversight contractor has estimated that the project’s cost could be reduced
                                         by $44.3 million primarily because of reduced financing costs. The cost of



                                         Page 23                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix VIII
Northern New Jersey/Hudson-Bergen
Waterfront Light Rail Line




the project could decrease further because of the alignment changes.
However, the final design for these changes is not complete, and a Finding
of No Significant Impact (FONSI) has not yet been issued. If a FONSI is
issued, FTA expects to negotiate an amendment to the grant agreement to
address the potential changes to the project’s overall scope and cost.




Page 24                              GAO/RCED-99-240 New Starts Transit Projects
Appendix IX

Portland/Westside Light Rail Extension to
Hillsboro

                                          The Tri-County Metropolitan Transportation District (Tri-Met) in Portland,
Project Description                       Oregon, has constructed an extension of the existing Banfield light rail line
and Status                                from its downtown Portland terminus to downtown Hillsboro. The project
                                          consists of a 17.7-mile, double-track fixed guideway with 20 stations and 9
                                          park-and-ride lots. The route includes a 3-mile twin-tube tunnel under the
                                          West Hills, essentially paralleling the Sunset Highway. Also included are 36
                                          low-floor light rail vehicles, the first to be placed in service in the United
                                          States. The full funding grant agreement was signed on September 29,
                                          1992. The Westside-Hillsboro light rail project opened for service on
                                          September 12, 1998. The contract’s closeout has continued into 1999, and
                                          most of the contracts are to be completed by early 2000.

                                          Table IX.1 shows the change in the project’s estimated cost, the amount of
                                          federal funding provided in the past, the amount proposed by FTA for fiscal
                                          year 2000, and the project’s estimated opening date.


Table IX.1: Portland/Westside Light Rail Extension to Hillsboro—Estimated Cost and Status of Federal Financial Support as
of May 1999
Dollars in millions
                                                                                                               Amount
                          Amount                 Amount to          Amount          Funding            FTA’s required
Baseline       Revised         of      Total     be funded         provided         shortfall       proposed        to           Projected
cost            grantee estimated      grant    through FY       through FY      through FY       funding for complete            opening
estimate       estimate increase     amount           1999             1999            1999          FY 2000    granta                date
$963.5                                 $630.1         $630.1          $619.0            $11.1            $11.1 Complete             9/12/98
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: Tri-Met-FTA full funding grant agreement, project management oversight report data,
                                          and FTA’s fiscal year 2000 annual new starts report.




                                          According to the grantee, this project could cost $9.72 million less than the
Pending Issues                            original baseline cost estimate. An amendment to the grant agreement that
                                          would allow the balance of funds to be used to purchase up to four
                                          additional light rail vehicles is awaiting FTA’s approval.




                                          Page 25                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix X

Sacramento/South Corridor Light Rail Line


                                          The Sacramento Regional Transit District (RT) is developing an 11.3-mile
Project Description                       light rail line in the South Sacramento Corridor. The system will follow
and Status                                existing Union Pacific right-of-way from downtown Sacramento to
                                          Calvine/Auberry. The project is being implemented in several phases. The
                                          full funding grant agreement, signed on June 20, 1997, represents the first
                                          phase and covers 6.3 miles, 6 stations, 3 park-and-ride lots, and 24 light rail
                                          vehicles. The grantee estimated that 15,000 riders will use the system each
                                          day. The project is in the later stages of final design (23 months into a
                                          75-month schedule) and, as of May 1999, was on target to meet its
                                          September 30, 2003, opening date.

                                          Table X.1 shows the change in the project’s estimated cost, the amount of
                                          federal funding provided in the past, the amount proposed by FTA for fiscal
                                          year 2000, and the project’s estimated opening date.


Table X.1: Sacramento/South Corridor Light Rail Line—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                               Amount
                         Amount                  Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total     be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant    through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount           1999             1999            1999          FY 2000    granta                date
$222.0                                $111.2            $52.3           $51.5            $0.8            $25.0        $34.7         9/30/03
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: RT-FTA full funding grant agreement, project management oversight report data, and
                                          FTA’s fiscal year 2000 annual new starts report.




                                          This project is in the later stages of final design, and, as of May 1999, there
Pending Issues                            were no outstanding issues that could adversely affect the project’s
                                          schedule or budget.




                                          Page 26                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix XI

Salt Lake City/South Light Rail Line


                                          The Utah Transit Authority (UTA) is constructing a 15-mile light rail line
Project Description                       from downtown Salt Lake City to the southern suburbs. The line would
and Status                                operate on city streets downtown (2 miles) and then follow a lightly used
                                          railroad alignment owned by UTA to the suburban community of Sandy (13
                                          miles). This project is one component of the Interstate 15 corridor
                                          improvement initiative, which includes reconstruction of a parallel
                                          segment of I-15. The full funding grant agreement, signed on August 2,
                                          1995, projected an opening date of December 31, 2000. As of May 1999, the
                                          project was expected to open for service on March 3, 2000, nearly 10
                                          months ahead of schedule.

                                          Table XI.1 shows the change in the project’s estimated cost, the amount of
                                          federal funding provided in the past, the amount proposed by FTA for fiscal
                                          year 2000, and the project’s estimated opening date.


Table XI.1: Salt Lake City/South Light Rail Line—Estimated Cost and Status of Federal Financial Support as of May 1999
Dollars in millions
                                                                                                               Amount
                          Amount                 Amount to          Amount          Funding            FTA’s required
Baseline       Revised         of       Total    be funded         provided         shortfall       proposed        to           Projected
cost            grantee estimated       grant   through FY       through FY      through FY       funding for complete            opening
estimate       estimate increase      amount          1999             1999            1999          FY 2000    granta                date
$312.5                                 $237.4         $177.4          $199.5           ($22.1)           $37.9 Complete               3/3/00
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: UTA-FTA full funding grant agreement, project management oversight report data, and
                                          FTA’s fiscal year 2000 annual new starts report.




                                          According to UTA and FTA, this project could cost $23.53 million less than
Pending Issues                            the original baseline estimate. A UTA official attributed potential cost
                                          savings primarily to favorable construction bids at the outset of the
                                          project, the early procurement of vehicles already in production through
                                          another grantee, the reduction of the project schedule by 1 year, and the
                                          fact that federal funds have been provided in accordance with the funding
                                          schedule in the grant agreement. UTA and FTA officials are currently
                                          negotiating the allocation of unspent funds to improvements to the
                                          project’s existing scope. For example, UTA hopes to widen some




                                          Page 27                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix XI
Salt Lake City/South Light Rail Line




single-track bridges to double-track and purchase additional vehicles to
handle the increased traffic generated by special events.




Page 28                                GAO/RCED-99-240 New Starts Transit Projects
Appendix XII

San Francisco/BART Airport Extension


                                         The Bay Area Rapid Transit District (BART) is implementing an 8.2-mile,
Project Description                      four-station extension of the BART system to provide service to San
and Status                               Francisco International Airport. The project consists of a mainline
                                         extension from the existing BART station at Colma, through Colma, South
                                         San Francisco, and San Bruno, terminating at the Millbrae Avenue
                                         BART/CalTrain Station. An additional track from the main line north of
                                         Millbrae will take BART trains directly into an airport station adjoining a
                                         new international terminal. The grant agreement, signed on June 30, 1997,
                                         called for a September 2001 opening date. However, as of May 1999, the
                                         project was expected to open in June 2002—9 months behind schedule.

                                         Table XII.1 shows the change in the project’s estimated cost, the amount
                                         of federal funding provided in the past, the amount proposed by FTA for
                                         fiscal year 2000, and the project’s estimated opening date.


Table XII.1: San Francisco/BART Airport Extension—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                              Amount
                          Amount                                   Amount          Funding            FTA’s required
Baseline       Revised         of      Total    Amount to         provided         shortfall       proposed        to           Projected
cost            grantee estimated      grant    be funded       through FY      through FY       funding for complete            opening
estimate       estimate increase     amount    through FY             1999            1999          FY 2000    granta                date
$1,167.0       $1,483.2    $316.2     $750.0         $214.3          $153.4            $60.9            $84.0      $512.6         06/30/02
                                         Legend

                                         FY = fiscal year
                                         a
                                          Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                         year 2000 is appropriated.

                                         Sources: BART-FTA full funding grant agreement, project management oversight report data, and
                                         FTA’s fiscal year 2000 annual new starts report.




                                         Of the $316 million cost increase, $165.5 million (52 percent) is attributed
Reasons for Cost                         to construction costs. Of this amount, BART attributed $109 million to
Increases                                (1) higher-than-expected bids on three contracts caused by a very
                                         competitive Bay Area economy and (2) added contingencies to address
                                         potentially high bids on other contracts. BART attributed the remaining
                                         construction cost increases to a variety of additions to the project’s scope,
                                         low initial estimates for systems work (e.g., automatic fare collection
                                         system), and change orders due to unexpected conditions. The
                                         nonconstruction cost increases are primarily due to higher-than-expected



                                         Page 29                                          GAO/RCED-99-240 New Starts Transit Projects
                 Appendix XII
                 San Francisco/BART Airport Extension




                 costs for right-of-way and third-party contracts—engineering and
                 construction management. In addition, about $16.5 million of the cost
                 increase is associated with additional financing costs that BART anticipates
                 incurring because of a slower-than-expected pace of federal funding.


                 FTA  is reviewing BART’s cost estimate of $1.483 billion and the project
Pending Issues   management oversight contractor’s estimate of $1.536 billion. The project
                 management oversight contractor’s estimate reflects cost increases
                 associated with the station work at the airport and additional contingency
                 amounts. It is unclear whether FTA will require BART to revise its cost
                 estimate to reflect the estimate of the oversight contractor and, if so,
                 where BART would obtain additional funding. Another issue under
                 negotiation is BART’s proposal to cancel its planned $100 million purchase
                 of 28 rail cars and spend $70 million on improving 4 of its maintenance
                 facilities. These improvements would enable BART to expand the capacity
                 of its maintenance shops and thus reduce the amount of time that cars are
                 out of service. With these improvements, BART believes that it can use its
                 existing fleet to provide the vehicles needed to operate on the new
                 extension. BART proposes to use the $30 million currently in the revenue
                 vehicles’ budget to help cover the construction cost increases. FTA is
                 reviewing this proposal and a new cost/finance plan. However, FTA has no
                 plans to amend the grant agreement to commit additional new starts funds
                 to cover the project’s cost increases.




                 Page 30                                GAO/RCED-99-240 New Starts Transit Projects
Appendix XIII

San Jose/Tasman Light Rail West Extension


                                          The Santa Clara County Transit District (SCCTD) is constructing a 7.6-mile
Project Description                       light rail extension of the existing Guadalupe Corridor light rail system.
and Status                                The project consists of 12 new stations and 2 park-and-ride lots. It has an
                                          estimated ridership of 5,800 per day and will connect with the CalTrain
                                          commuter rail system at its new western terminus. Overall construction is
                                          progressing on schedule with no major issues of schedule and quality. The
                                          full funding grant agreement, signed on July 2, 1996, projected an opening
                                          date of December 2000. As of May 1999, the projected opening date was
                                          December 20, 1999.

                                          Table XIII.1 shows the change in the project’s estimated cost, the amount
                                          of federal funding provided in the past, the amount proposed by FTA for
                                          fiscal year 2000, and the project’s estimated opening date.


Table XIII.1: San Jose/Tasman Light Rail West Extension—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                               Amount
                         Amount                  Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total     be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant    through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount           1999             1999            1999          FY 2000    granta                date
$325.0                                $182.8          $162.8          $150.9            $11.9            $31.9 Complete            12/20/99
                                          Legend

                                          FY = fiscal year
                                          a
                                           Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                          year 2000 is appropriated.

                                          Sources: SCCTD-FTA full funding grant agreement, project management oversight report data,
                                          and FTA’s fiscal year 2000 annual new starts report.




                                          The grantee’s current cost estimate does not include an additional
Pending Issues                            $2.8 million in modifications that are beyond the scope approved in the
                                          grant agreement and therefore must be borne by the grantee.




                                          Page 31                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix XIV

San Juan/Tren Urbano Rapid Rail Line


                                         The Puerto Rico Highway and Transportation Authority (HTA) is
Project Description                      constructing a 10.7-mile, 16-station rapid rail line between Bayamon
and Status                               Centro and the Sagrado Corazon area of Santurce in the San Juan
                                         metropolitan area, which covers phase 1 of the project. This project has
                                         been selected as one of FTA’s “turnkey” demonstration projects, which
                                         incorporates contracts to design, build, operate, and maintain the system.
                                         The full funding grant agreement was signed on March 13, 1996. During
                                         1996 and 1997, seven design-build contracts were awarded for different
                                         segments of the project. The Systems Test Track and Turnkey contract,
                                         awarded in August 1996, provided for the purchase of rolling stock, design
                                         and installation of all systemwide components, construction of one of the
                                         segments, and operation and maintenance of the project for an initial
                                         period of 5 years. The Tren Urbano project is expected to carry 113,300
                                         riders per day in 2010. As of May 1999, the project was expected to open
                                         for service in May 2002—10 months behind schedule. According to the
                                         project management oversight contractor, this delay is primarily due to the
                                         limited availability of a skilled workforce.

                                         Table XIV.1 shows the change in the project’s estimated cost, the amount
                                         of federal funding provided in the past, the amount proposed by FTA for
                                         fiscal year 2000, and the project’s estimated opening date.


Table XIV.1: San Juan/Tren Urbano Rapid Rail Line—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                              Amount
                         Amount                 Amount to          Amount          Funding            FTA’s required
Baseline      Revised         of       Total    be funded         provided         shortfall       proposed        to           Projected
cost           grantee estimated       grant   through FY       through FY      through FY       funding for complete            opening
estimate      estimate increase      amount          1999             1999            1999          FY 2000    granta                date
$1,250.0       $1,676.0    $426.0     $307.4         $107.4            $48.3           $59.1            $82.0     $177.10          5/31/02
                                         Legend

                                         FY = fiscal year
                                         a
                                          Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                         year 2000 is appropriated.

                                         Sources: Puerto Rico HTA-FTA full funding grant agreement, project management oversight
                                         report data, and FTA’s fiscal year 2000 annual new starts report.




                                         As of May 1999, the cost estimate for the Tren Urbano project was $1.676
Reasons for Cost                         billion. This represents a $426 million dollar increase over the original
Increases

                                         Page 32                                          GAO/RCED-99-240 New Starts Transit Projects
                 Appendix XIV
                 San Juan/Tren Urbano Rapid Rail Line




                 estimate of $1.25 billion in the full funding grant agreement. According to
                 FTA, the project management oversight contractor, and the grantee, the
                 primary factors contributing to this increase include the following: the
                 addition of two stations, alignment changes, station enhancements, an
                 enhanced fare collection system, an expanded system integration and
                 quality assurance program, and engineer’s low initial estimates.

                 Approximately 2 years had elapsed between the time the engineer’s
                 estimates used in the grant agreement were prepared and the fall of 1997,
                 when all of the design-build contracts were awarded. During this period,
                 two stations were added, and other station enhancements were made. The
                 contract awards were $129 million higher than the engineer’s original
                 estimates. However, the engineer’s estimates prepared at the time the
                 contracts went out for bid were quite close to the bids received. Since the
                 contract awards, there has been an additional $185.2 million in approved
                 enhancements and scope changes, including $85 million for additional
                 construction management services, $20.2 million for additional vehicles,
                 and $22.7 million for contract options related to the two added stations. In
                 addition, there is currently another $81.5 million in potential and pending
                 increases for the project because of enhancements, differing site
                 conditions, and hurricane delays. This includes $26.8 million for an
                 enhanced fare collection system.


                 FTA is conducting a financial capacity review of HTA for the Tren Urbano
Pending Issues   project. As part of this review, FTA is assessing the project’s financial plan
                 to ensure that adequate funding is available to build and maintain the
                 project without adversely affecting the area’s other transportation needs.
                 FTA’s initial concerns have centered on the department-wide rather than
                 project-specific nature of the plan and the plan’s lack of detail and
                 explanation in some areas. HTA has hired a consultant to assist in revising
                 the financial plan. FTA’s financial capacity review contractor plans to meet
                 with the consultant to address FTA’s concerns. FTA is also preparing to
                 amend the full funding grant agreement to reflect the revised cost estimate
                 and projected opening date. This amendment would also explicitly
                 reference the non-new starts federal funds that would be dedicated to
                 assist in financing the project’s estimated cost increase. The amendment
                 would not change the current new starts commitment level of
                 $307.4 million. FTA expects all documentation needed for FTA headquarters’
                 final review to be completed by early August 1999.




                 Page 33                                GAO/RCED-99-240 New Starts Transit Projects
Appendix XV

St. Louis/St. Clair County Light Rail
Extension

                                           The Bi-State Development Agency (Bi-State) is developing a 26-mile extension
Project Description                        of the Metrolink light rail line from downtown East St. Louis, Illinois, to
and Status                                 the Mid America Airport in St. Clair County, Illinois. The full funding grant
                                           agreement, signed on October 17, 1996, covers a 17.4-mile interim segment
                                           from the current Metrolink terminal in downtown East St. Louis to
                                           Belleville Area College. This segment consists of 8 stations, 7 park-and-ride
                                           lots, 20 new light rail vehicles, and a new maintenance facility in East St.
                                           Louis. The route makes extensive use of abandoned rights-of-way. As of
                                           May 1999, the project was on schedule and therefore expected to meet the
                                           opening date of September 30, 2001, approved in the grant agreement.

                                           Table XV.1 shows the change in the project’s estimated cost, the amount of
                                           federal funding provided in the past, the amount proposed by FTA for fiscal
                                           year 2000, and the project’s estimated opening date.


Table XV.1: St. Louis/St. Clair County Light Rail Extension—Estimated Cost and Status of Federal Financial Support as of
May 1999
Dollars in millions
                                                                                                                Amount
                          Amount                  Amount to          Amount          Funding            FTA’s required
Baseline       Revised         of       Total     be funded         provided         shortfall       proposed        to           Projected
cost            grantee estimated       grant    through FY       through FY      through FY       funding for complete            opening
estimate       estimate increase      amount           1999             1999            1999          FY 2000    granta                date
$339.2                                 $243.9          $109.8          $104.4             $5.4            $50.0        $89.5         9/30/01
                                           Legend

                                           FY = fiscal year
                                           a
                                            Amount of funding required to complete the grant agreement if the amount proposed for fiscal
                                           year 2000 is appropriated.

                                           Sources: Bi-State-FTA full funding grant agreement, project management oversight report data,
                                           and FTA’s fiscal year 2000 annual new starts report.




                                           Several issues could affect the project’s cost and schedule, including
Pending Issues                             contractors’ potential claims relating to Illinois Department of Natural
                                           Resources permit issues and real estate acquisition. The project
                                           management oversight contractor does not believe that these issues are
                                           currently of sufficient significance to change either the project’s cost
                                           estimate or projected opening date.




                                           Page 34                                          GAO/RCED-99-240 New Starts Transit Projects
Appendix XVI

GAO Contacts and Staff Acknowledgments


                  Phyllis F. Scheinberg, (202) 512-2834
GAO Contacts      Ron Stouffer, (202) 512-2834
                  Kirk Kiester, (404) 679-1900


                  In addition to those named above, Joe Christoff, Mike Ibay, Dave Lehrer,
Acknowledgments   Dave Lichtenfeld, and Carol Ruchala made key contributions to this
                  report.




(348168)          Page 35                                 GAO/RCED-99-240 New Starts Transit Projects
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