Tuesday, September 12, 2017

Southwest LRT bids may all be rejected due to high cost

Written by 

Metropolitan Council Chair Alene Tchourumoff is recommending that all four civil construction bids for the Southwest LRT project be rejected due to responsiveness and price.

The bids range between $796.5 million and $1.08 billion and were opened in August. They represent the bulk of the construction work involved in building the tracks, road, bridges, trails, tunnels, stations and other facilities needed for the light rail line.

Tchourumoff is also recommending the Council vote to direct project staff to look at ways to reduce cost and prepare to reissue the invitation for civil construction bids in October. The recommendation will be presented and discussed at the Sept. 13 meeting with final discussion and a vote taking place at a special Sept. 20 meeting.

"We must look closely at ways to modify the specifications for these bids in a way that will reduce project costs where possible," said Tchourumoff. "Working together with Hennepin County, I think we can bring innovative cost reduction strategies to the table and ultimately find efficiencies in this procurement. We're going to be sharpening our pencils and we encourage the contractors to do the same."

The project's original scope was downsized in July 2015 to help shave an estimated $250 million from the projected cost.

Pending council approval of this action, staff will begin working on possible modifications, with a plan to reissue the procurement in October. The bids are scheduled to be opened in December and awarded in March 2018. This delays the project by four months, moving the opening of the line to 2022.

This would also delay the application for and receipt of the Full Funding Grant Agreement from the Federal Transit Administration. The federal share of the $1.858-billion project is $929 million. The project remains highly competitive for federal funding with a medium-high rating under federal scoring criteria. In August, 73 state lawmakers signed a letter to Transportation Secretary Chao, detailing their support for continued transit funding and the importance of the Southwest LRT project to the region.

"While certainly this is a setback in our schedule, it doesn't change the importance or strength of this project. This is a critical infrastructure project for our Twin Cities region and state, connecting people of all incomes with jobs across the region. The future vitality of our region depends on the build-out of a robust transit system. We are fully committed to building Southwest Light Rail and are grateful to the communities, businesses and others who have invested time, energy and resources in this project and eagerly anticipate its completion," said Tchourumoff.