On July 12, the same day that the Seattle City Council was looking for assurance from its consultants that a giant tunnel under downtown is viable, two new pieces of information surfaced that cast doubt on the project’s future.
The first piece of information concerned the much-discussed possibility of cost overruns, a risk tunnel proponents have attempted to minimize. John Newby, who is working for the city to double-check the state’s work, told the council there is a 40 percent chance that the $1.96 billion tunnel (which is the riskiest part of the larger $4.2 billion project to replace the Alaskan Way Viaduct) will run over budget.
That 40 percent probability of an overrun fits with international averages that show most megaprojects run over budget. This would be the widest deep-bore tunnel (54 feet across) ever attempted anywhere. The risk is of concern to Seattle, even though the project is technically a state highway, because the legislature has capped the amount the state will spend and passed a law saying Seattle must pay for any overruns.
“The city is the one with risks if the costs go over budget,” says Mayor Mike McGinn.
The other piece of bad news for tunnel proponents: One of the three remaining bidders applying for the job has dropped out. The group AWV Joint Venture announced on July 12 that it “is not engaged in any pre-bid activities related to the project,” according to Kent Grisham, spokesman for the leading contractor on the team, Kiewit Corporation. “The current contract model and our business model are not compatible.”
“If you believe in our capitalist model, we thrive on competition, and when there’s only two bidders left, it’s clearly problematic,” says city council member Mike O’Brien. “There are only two teams on the whole planet willing to put out a bid on this thing. It puts out a question about the risk of what they’re bidding on.”
Ron Paananen, who is overseeing the project for the Washington State Department of Transportation, says the company wanted “shared risk” with the state, but “we did not feel it was appropriate for this tunnel.” Typically the state has several more bidders competing for a contract, says Paananen. “I would have to go back and see if we have ever had fewer than three bidders.” He did not get back to The Stranger by press time. 
It will go over budget! Probably ALOT over budget! Seattle: think hard about this before moving forward! What if the development market stays stagnant, how long will we be carrying a huge debt until the construction of fancy condo’s goes up ontop of this thing and helps re-fill the cities coffers?
We absolutely need two north-south highways/expressways. I-5 cannot meet the traffic demands of our long & skinny city alone. And while we can yammer on about reducing the amount of cars on the highways, we are still a port city that moves a lot of goods around!
Aurora IS a surface street! Is there some reason why we can’t design this thing so that traffic can move effectively through downtown, and not be burdened with the huge costs of this tunnel??? I think the idea of “surface street” wrongfully calls to mind something with traffic lights and cross walks. But this can be done with sky bridges and medians the same way it exists in other parts of the city. I mean we have a freaking surface light rail!!! (which honestly, I think is way way more dangerous than a surface expressway, because the cars and trains and pedestrians are all forced to share the same spaces)
Why can’t we look into the same model that we used for freeway park, but without the “rape corners”???? The street could run on the surface level, with a park constructed over it. It would probably use about the same amount of materials, but negate the need for excavating. Building up is way easier than building down! By encasing the freeway, you could prevent pedestrians from accessing the freeway section.
I can think of so many better places my tax money could go to! I really don’t want to see cost over-runs bankrupt other vital city programs.
“John Newby, who is working for the city” is a consultant hired by the mayor for $40,000 to torpedo the tunnel project.
“…says city council member Mike O’Brien.” O’Brien is a McGinn shill who does his master’s bidding.
How about some fair and accurate reporting, as well as transparency. This article is completely one-side. It could have been a lot more balanced with minimal effort.
@2) Newby was hired by the city council, not the mayor.
so, there’s a 60% chance of no overruns? What fucking BS. There’s a 100% chance of overruns, anyone in the construction industry know this. A goddamned house has overruns. There’s a 40% chance of mother fucking, catastrophic, city crippling overruns.
..and, “The current contract model and our business model are not compatible.” means there’s gonna be overruns bitches, and that’s how we make our money, bitches. And if you don’t want to pay cost overruns then peace out, bitches!
Another hysterical piece of crap courtesy Holden. Everything I’ve read says McGinn hired the consultant, not the City Council. He’s a $40,000 publicity stunt by the mayor’s office.
I did like O’Briens silly little jab at “our capitalist system” though. That tool is always good for a chuckle.
“That 40 percent probability of an overrun fits with international averages that show most megaprojects run over budget.”
I’m no math whiz, but when did 40% become most?
Also, does that mean there’s a 60% chance it’ll come in under budget?
pkbrown
It’s from the state’s Cost Estimate Valuation Process. I think you can find the chart on Mike O’Brien’s website.
What the opponents don’t tell you is the state has a $400 million reserve fund for the tunnel. As long as that amount is not exceeded.