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Firms have $52.5M management contract on road improvement program Posted: Sunday, Feb 18, 2007 - 10:02:43 am PST By DAVE GOINS Bee correspondent
BOISE -- Washington Group International and CH2M-Hill have a $52.5 million contract with the state of Idaho for engineering and environmental services on the "Connecting Idaho" roads improvement initiative championed into law two years ago by then-Gov. Dirk Kempthorne. In the contract document obtained Friday for The Press by Idaho News Service, charges included in the contract made official Aug. 3 are linked to "Initial Agreements" between the state and the engineering firms on March 31, 2003. That was 21 months before Kempthorne presented the roads improvement borrowing program, commonly known as GARVEE (Grant Anticipation Revenue Vehicle), to the Legislature.GARVEE's current $52.5 million contract, officially entitled the "Program Management Services Agreement," can be amended by the signing parties, and extends to June 30, 2009. In a late-2005-dated document presented last year to state budget writers by the Idaho Transportation Department, program management costs for a six-year span ending in 2011 were estimated at $30 million.
Sen. Jim Hammond, R-Post Falls, asked WGI's David Butzier at a Thursday meeting of the Senate Transportation Committee to later provide further financial details on the contract costs. During the meeting, Butzier said: "We (WGI and CH2M-Hill) are not getting all that, but this is the easier way to account for it." Butzier said the two firms and the state added $2.9 million in fixed fees to the contract to cover business risk factors, which would include the possibility of getting sued. Hammond said he would look further into the GARVEE program manager cost. "I need to see what we're buying here," said Hammond, vice-chairman of the Senate Transportation Committee. "Not just the risk, but overall, what are all these things buying?" Varying from what Butzier stated, the written contract includes $6.2 million in fixed fees ($3.0 million for "program-wide services"; $3.2 million for "project-specific services"). Coinciding with Butzier's testimony, the contract includes $15 million for program management, and $31.3 million for "project-specific services." Butzier said during the Thursday meeting that the $31.3 million breaks down to $15.2 million for preliminary design work, $10.5 million for engineering and inspection, $2.7 million for final design work, $1.7 million for preliminary design coordination, and $1.2 million for right of way procurement. The GARVEE program is predicated on the idea that the revenue bonds will gradually be paid back with highway appropriations from the federal government, and that borrowing the money, rather than following Idaho's traditional pay-as-you-go basis, beats inflated road construction costs in the future. Idaho's first $200 million in GARVEE bonds were sold in May. But now the federal government has indicated that GARVEE money is getting tighter, new ITD Director Pamela Lowe told state budget writers Feb. 8. "Federal revenue has flattened," said Lowe, and, "federal obligation authority has decreased to 86 percent." The overall GARVEE program has been reduced by $152 million, from last year's $1.15 billion, which had declined from what Kempthorne originally touted as a $1.6 billion program. Even so, the Idaho Transportation Board now serving under new Idaho Republican Gov. Butch Otter has requested $101.4 million more than Kempthorne for the next two budget years (fiscal years 2008 and 2009) starting July 1. That proposal for an accelerated program schedule is palatable to Sen. John McGee, R-Caldwell. "As long as we are not putting the state's bonding rating at stake, I'm comfortable with a higher dollar amount for GARVEE," said McGee, who chairs the Senate Transportation Committee. Changes to individual funding requests since the original program request two years ago have made the I-84 Meridian to Caldwell project the largest GARVEE segment at $327.8 million. That Meridian to Caldwell I-84 project amount is now $214.2 million above what it was two years ago; more than quadruple the $70 million request that it had been reduced to last year. "Mr. Chairman, I think that might be your favorite corridor," Butzier said to McGee during the Thursday Senate Transportation Committee meeting. "I have some small interest in that," McGee said. The request for North Idaho's allocation has declined by $100.8 million since the original GARVEE proposal. And the program has become more urban with the I-84 Meridian to Caldwell project increase. But Sen. Shawn Keough, R-Sandpoint, said the shift to more urban projects is fair. "Certainly our projects in the north are critical to us," Keough said. "But ITD has to look at projects statewide. And the population growth here is explosive." Potter wrote on Feb 19, 2007 11:20 PM: " Citizen - why don't you identify yourself instead of hiding behind a made up name? What are you afraid of? The tunnel alternative has regulatory clarity that the highway-in-the-creek does not. Not only can it be permitting from a regulatory standpoint it does not require BNSF to sell land that they do not wish to and cannot be forced to. Because of ITD's “damn the torpedoes” approach to regulatory compliance it is almost certain that nearly $20 million will get flushed down the toilet along with many years of wasted time. A five-minute reading of the Section 404 requirements of the Clean Water Act is all that it takes to figure out that this project will NEVER happen. Yet ITD made a very bad choice to attempt to turn it into a popularity contest and push forward knowing what was at risk. It is pretty apparent that they built the FEIS around the answer they wanted. Why else would the through town route have routed Northbound US-95 on 4th where it had fills into Sand Creek and hit the historic Humbird Mill houses? During this same period they were in negotiations with UP for up to 150 ft of right-of-way along 5th – and somehow they could not see how they could fit 4 lanes into a total available 200ft and avoid the use of 4th? Also, though it is claimed that a Superior to 5th route (i.e. the South Side Tunnel) was studied there is not a bit of paper work on it and it was never listed as one of the 14ish alternatives that were studied. This project is going down because of some very bad decisions that were made to run roughshod over environment regulations. Get used to it. Time to give it up and find another way. " citizen wrote on Feb 19, 2007 4:40 PM: " what? engineering ill-conceived projects that end up in the bucket? Sounds like tunnel vision Potter " Steve Potter wrote on Feb 18, 2007 6:14 PM: " GARVEE = Idaho's Civil Engineer's Full Employement Act. It's always a good day to be a Civil Engineer in Idaho. If you pay attention you will find out that a lot of money get spend on engineering for ill-conceived projects and the drawings just end up in a bucket. " POST YOUR OPINION
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Bonner County Daily Bee
P.O. Box 159 / Sandpoint, Idaho 83864 / 208-263-9534
Bonner County Daily Bee Online is updated at 10am PST.
george bailey wrote on Feb 20, 2007 8:42 AM: