Dec. 15 project update: Looking ahead to 2017 and beyond

Posted on Dec 15 2016 1:11 PM
Day by day, ring by ring, the SR 99 tunnel continues to take shape beneath downtown Seattle. The tunnel now stretches from its starting point near the stadiums to the ground beneath Belltown, more than a mile to the north. As we’ve been highlighting throughout the week, construction is progressing at the north and south portals, and inside the tunnel, where crews are building the future double-deck highway that will carry traffic on SR 99. 
In July, as part of our semiannual update to the Legislature’s Joint Transportation Committee, we reported that the tunneling delay had led to additional WSDOT costs for longer-than-expected contract administration and oversight, as well as the need to extend agreements and leases with property owners above and near the tunnel route. We estimated this provisional need at $223 million over the remaining life of the program, but said we needed time to further refine our budget request prior to the upcoming legislative session.  
Today, we presented that update to the committee. The current legislatively approved budget for the program is $3.1 billion. Our revised estimate shows an additional budget need of $149 million – $74 million less than what we anticipated in July. Of that, $60 million will be needed in the upcoming 2017-2019 biennium to continue supporting our work to replace the Alaskan Way Viaduct. A copy of the full presentation is available on the JTC’s website.
Why is our budget request $74 million less than our July estimate? Simply put, we now have more information. In preparation for this budget request, we spent the past five months thoroughly reviewing every project schedule and every facet of our program. That included looking for new efficiencies, performing a statistical risk analysis and updating our cost estimates.  
As part of our process to refine these estimates, we set aside contingency funding. We did this by identifying remaining risks and calculating the potential costs associated with those risks, should they materialize. The biggest remaining risk – tunnel mining – is slated for completion next spring. We will continue to closely manage this and other risks moving forward.   
It’s important to note that none of these additional funds will be used to pay for tunneling machine repairs. This funding request is strictly to cover other program costs that were incurred because of the tunneling delay. We will continue to follow the tunnel project’s design-build contract to recover the added expense. This includes pursuing insurance claims, identifying potential cost savings in other elements of the program and ongoing litigation to recover damages. If efforts to recover costs are successful, the funds would likely not be available until after the project is complete.
Our goal, in everything we do, is to deliver critical projects while also protecting taxpayers. Replacing the viaduct is a massive endeavor consisting of 32 separate but related projects. Twenty-one of those projects are now complete, and the biggest one – the SR 99 tunnel – is on the path to successful completion. 
Next year will bring the breakthrough of the SR 99 tunneling machine. We look forward to that milestone, and to fulfilling the mission we began at the outset of this program: removing the viaduct and setting the stage for Seattle’s new downtown waterfront.

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