CA High-Speed Rail Contractor Gets 18% Raise After Missing Completion Date.
California High-Speed Rail agreed to increase payments to its construction manager by 18 percent after failing to complete its first 32-mile section within the seven-year deadline.
President Obama and his Democrat congressional majority voted in 2010 to fund the California High Speed Rail (Cal HSR) with $2.5 billion under the American Recovery and Reinvestment Act as the centerpiece of a national network of 10 intercity corridors in California, the Pacific Northwest, the Midwest, the Southeast, The Gulf Coast, Pennsylvania, Florida, New York, and New England.
Cal HSR contractually agreed to provide bullet train service with top speeds of 150 miles-per-hour over the 118-mile section between Madera and Bakersfield by September 30, 2017, or give the money back to the U.S. Treasury.
But after spending $3 billion of the fed’s money and $7.8 billion from California bond sales and revenue from the state’s infamous cap-and-trade taxes, Cal HSR has failed to lay a mile of track over the initial 32-mile section of flat San Joaquin Valley farmland.
Rather than demand the money back from Tutor-Perini/Zachry/Parsons, its project and construction manager (PCM), Cal HSR recently voted to extend the term of the contract by 6 months and to raise the price from $34.2 million to $40.2 million, an 18 percent bump.
The move is even more extraordinary given that Cal HSR admits that the professional service contract was “based on qualifications of PCM and its 25 staffing resources, as opposed to low bid.” That means Tutor-Perini/Zachry/Parsons employees, even if they worked exclusively on Cal HSR, are each being paid an average of $240,000 for the next six months of work.
Cal HSR told the Fresno Bee that the delays were due to extended environmental impact reviews and the protracted pace of acquiring 822 parcels of mostly farmland, either through negotiated purchase or suing under eminent domain.
But the publicly available transcript of the August 16 Cal HSR board meeting regarding the $6 million increase for PCM specifically states: “This request to increase the PCM contract value is necessary, because the expenditure rate for PCM services has been higher than was originally anticipated and the current budget is no longer adequate to complete all the necessary PCM services.”
Cal HSR staff blames the delay on three issues; 1) “acceleration of the design-build contract work”, 2) “increase in value of the design-build contract”, and 3) “additional scope of the services that the PCM has been directed to perform.” Staff stated that there will be no increase in the overall cost, because $6 million will be deducted from the second and third legs of the initial 118-mile section.
Read the rest at : High Speed Rail.