VTA ditches San Jose BART extension tunnel contractor whose estimate was double the budget ...Middle East

The Santa Clara Valley Transportation Authority on Friday severed ties with its tunnel contractor for the San Jose BART extension — a move that transit officials assert won’t impact the project’s overall schedule.

The decision unanimously reached by the Board of Directors comes as VTA — the agency tasked with building the six-mile, four-station BART line from the Berryessa Transit Center in North San Jose, through downtown and to Santa Clara — is rushing to close a $700 million to $1.2 billion funding gap. A review of the project has produced $400 million in cost savings so far, with more ideas expected to be reviewed this summer.

VTA officials made the recommendation to ditch Kiewit Shea Traylor (KST) — a joint venture of three international construction firms — earlier this month, citing an inability to reach an agreed upon price for the second phase of work.

The contract’s scope of work includes the single bore tunnel, station entrances and exits, the excavation of underground stations and the procurement of a tunnel boring machine. The first stage was for design and preconstruction work, while the second part is for the actual construction of the project. KST’s current contract is valued at $1,020.3 million.

“In our efforts to move from stage one to stage two, we’ve reached an impasse that we don’t think is bridgeable between what we think the right price for the tunnel project should be and what our partner KST thinks it should be,” Tom Maguire, the agency’s chief megaprojects delivery officer, told the board on Friday.

VTA officials previously said that KST’s estimate is more than twice of what they’ve budgeted. The agency hasn’t released the numbers, but said in a news release on Friday that it “significantly exceeded project budget limits.”

VTA already had discussions with 10 major tunneling contractors, which led them to believe they can get a price more aligned with the budget. Finding a new contractor will add at least 18 months — though it could be as many as 24 months — to the timeline for when tunneling work can begin. However, officials said they are still on track for a 2037 opening date as they plan to save time in other ways.

Cost increases and time delays have long plagued the San Jose BART extension. Original cost estimates were in the $4 billion range and the initial opening date was slated for 2026. Last year, federal transit officials upped the cost estimate once again — this time by $600 million for a total project cost of $12.75 million.

Some directors, including San Jose Councilmember David Cohen, expressed concerns on Friday about the project’s overall schedule given the delay to tunneling.

“I’m a little skeptical of this argument because we had been talking all along about how tunneling is the critical path,” Cohen said. “So to delay the critical path and then say we’re going to find ways to shave time off just makes me wonder how we’ve been approaching this so far.”

Maguire said that while the tunnel ultimately “controls the schedule and the budget,” they are “looking at ways in which we can overlap construction paths.” One of the cost saving proposals currently on the table is to tunnel concurrently from both the east and the west.

Santa Clara Councilmember Suds Jain questioned why it took the agency so long to make the recommendation as VTA and KST have been in price negotiations for nearly a year.

“It just doesn’t make any sense to me when we’re being told that it is $40 million a month for every delay that we have,” he said.

In response, Maguire said that they wanted to come back with more information about what comes after they cut ties with KST. The joint venture is expected to continue its preconstruction work and complete the design of the project.

But with the agency looking at certain redesigns as part of its cost savings effort, Jain raised concerns as to why they would want KST to complete its own design work, which assumes a 54-foot-in-diameter tunnel. Some of the changes being proposed would alter the size of the tunnel.

“It makes zero sense to me when we can’t fund this project for KST to continue designing something that we can’t fund,” Jain said.

Maguire noted that, “as KST is walking out the door, we should get a work product we can bid out in case there is any possibility of moving forward with a 53 foot tunnel.”

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