Lagging Metro Rail Work Could Delay 1993 Opening

The pace of work on Los Angeles’ Metro Rail subway line is slipping further and further behind schedule because of paper-work bottlenecks, contract disputes and the discovery of hazardous materials underground, federal consultants reported.

This assessment and another by RTD investigators present a troubling picture of progress to date on the $1.25-billion first phase of the huge project, mostly on tunnels and stations in the downtown area.

In the report prepared for the Urban Mass Transportation Administration, the federal monitors warn that if the problems are not addressed quickly the opening of the system, already postponed eight months to January, 1993, may have to be delayed further.

“It is evident that all major contracts except (two) are falling further behind the planned completion (rates) as reported by SCRTD (the transit district),” said the report.

At the same time, a preliminary audit by the inspector general of the Southern California Rapid Transit District has found that Metro Rail project managers have intentionally bypassed cost-control procedures, exposing the project to the possibility of additional expense and months of unnecessary delays.

“The expediency of the project was placed ahead of financial concerns and contractual detail,” the report concludes. “The established procedures were circumvented at the risk of increased costs. . . . Thorough planning was sacrificed . . . which could, in fact, result in project delay.”

Together, the reports raise the most serious concerns to date about the management of project, as well as the accuracy of information on cost and construction progress.

The encouraging news so far is that, despite delays and millions of dollars in added costs, the initial segment of the Los Angeles subway remains under its budget, according to the federal monitors. That is because winning bids on major construction jobs were more than $80 million below the RTD’s estimates.

With most of the Metro Rail construction still ahead, however, some RTD sources said they fear that the current financial cushion could be eaten up if the project is not tightly controlled.

The more extensive assessment was prepared by Hill International, a consulting firm hired by the UMTA to monitor Metro Rail progress and help avoid the kinds of construction delays and cost overruns that have plagued federally funded mass transit projects in other cities.

Hill International consultants found that while the new Metro Rail opening date is more realistic, the transit district still “has not assessed the full impact” of that delay on the overall project budget or the schedules of the various contractors.

‘Very Complex Project’

William Rhine, the RTD’s acting assistant general manager in charge of Metro Rail construction, denied that the project is headed for trouble. “That’s their opinion,” he said of the federal consultants’ warnings.

But Rhine acknowledged that there have been RTD management problems and delays in recent months.

“I’m not saying it’s a happy situation. Everything hasn’t gone smoothly,” Rhine said. “This is a very complex project . . . (and) we have a very difficult and tough schedule. We are going to do everything possible to meet the (new) schedule.”

However, Rhine added, he is “neither optimistic nor pessimistic” about being able to do that.

RTD officials justified the delay last January by citing problems near Union Station, where the subway had to be realigned to avoid a pocket of hazardous soil. At the time, RTD officials stressed that the additional cost of the delay was estimated to be $4.2 million.

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‘I’m not saying it’s a happy situation. Everything hasn’t gone smoothly.’

--William Rhine, acting

assistant general manager

in charge of Metro Rail construction

However, the latest UMTA report, one of a series, says that estimate appeared to exclude

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creased overhead costs for work of RTD staff and RTD consultants--a figure that could be substantial.

In an interview, Rhine acknowledged that the estimate presented to the RTD board and later publicized in RTD press releases was not complete. The actual figure could be millions of dollars higher when all of the costs are included, he said. “I overlooked it,” he said.

It also turns out that the Union Station tunneling contract was not the only one that is behind the original schedule. Contractors elsewhere were running into mechanical problems with tunneling equipment, uncharted underground tanks containing hazardous waste, asbestos in utility tunnels and scheduling problems.

“Hill Street’s become the land of the unknown,” said Rhine, referring to the north-south subway route through downtown where a number of unanticipated problems have been encountered.

Contractors and some RTD employees have blamed the transit district for being slow in processing the necessary design changes and work orders to resolve problems arising in the field.

Rhine admitted that there have been paper-work problems. “Some of these things occurred last fall when we didn’t have a process (for handling work order changes for contractors),” he said. “We were stalled.” He said new procedures now are in place and the problems are being resolved. Federal monitors said that under Rhine, efficiency has improved.

However, last spring, RTD officials gave the public similar assurances when The Times first reported that confusion and internal RTD turf wars were causing potentially costly problems in Metro Rail contract management.

“Much of the problem still exists,” said Bernard Bandy, a former RTD manager, who until last month kept track of changes on Metro Rail contracts.

Metro Rail engineers in the field are not forwarding paper work to the central office for action, Bandy said. “As a result, schedule delays are being caused that are translating into dollars,” he said.

A $3.5-million claim against the district by the contractor building the subway station at 5th and Hill streets is an example, Bandy said. The contractor, Guy F. Atkinson Construction Co., claimed that the district was slow in processing needed design and contract changes when workers ran into several unexpected problems, including old underground tanks. The contractor said his work has been delayed five months. “Much of that claim could have been circumvented . . . (if the RTD procedures) had been working properly,” Bandy said.

Bandy, who was terminated by the RTD after a 6-month probationary period, said he worked more than 20 years in aerospace administering cost controls and contract changes on large projects. He said RTD officials did not appreciate his efforts to try to improve contract management.

“My belief is that (RTD) management resisted control. . . . They are grossly unfamiliar with the whole (contract management) structure and how to keep the flow of (unexpected work) changes moving,” he said.

Jeff Christiansen, Metro Rail’s director of program control and Bandy’s former supervisor, denied Bandy’s charges, including the assertion that the RTD was responsible for many of the construction delays.

“As a matter of fact, I suspect we incorporated the vast majority of (Bandy’s) recommendations,” Christiansen said, adding that Bandy was let go solely because he “did not meet the expectations of that position.”

Either way, the RTD’s own Inspector General staff found serious and costly problems in the district’s management of one of the most troubled Metro Rail contracts, the tunneling work between Union Station and Pershing Square.

The work has been delayed for a variety of reasons, including disputes with the railroads that own Union Station over construction access and how the underground subway terminal would fit in to the rest of the station. There also have been more problems in designing a system to decontaminate millions of gallons of ground water that will have pumped out of the area.

A special processing plant is being built to treat the water before it is dumped into the Los Angeles River. Some knowledgeable RTD sources have told The Times that the water treatment plant alone may add $10 million or more to the cost of the Union Station contract--five times the original estimate.

Officially, the current estimate of potential cost increases at Union Station is about $8.6 million--a 14% increase--and the contractor is still months away from beginning actual tunneling work.

Among the costs being claimed by the contractor is $50,000 per month to store a large tunneling machine.

The RTD could have greatly controlled such costs had Metro Rail managers postponed the awarding of the tunneling contract until station design, property access and water treatment issues were resolved, the inspector general’s report says.

sh Opted to Go Ahead

But Metro Rail officials said they opted to hire the contractor and work out problems later because of “pressure to get the (construction) process under way” after long-delayed federal funding finally became available in late 1986, the report says.

In addition to poor RTD planning that has contributed to higher costs, the RTD’s management of contractor work orders on the water treatment facility “appear to be out of control,” the inspector general’s report says.

The true value of contract changes has been purposely understated by Metro Rail managers so they could bypass requirements for audits and RTD board approval, the inspector general’s report says. Those actions violated RTD and possibly federal contracting procedures and, in one case, resulted in the district being billed $286,000 for a water treatment plant design that will not be used, the report says.

If federal regulations were violated, some of the federal funds for the Union Station contract could be in jeopardy, the inspector general’s report warns.

While there may have been “one or two isolated incidents” in which procedures were not followed, Rhine said, they occurred before he took command of Metro Rail construction last year.

“I have a rigorous set of procedures in place now. They are going to be enforced,” he said.

DELAYS FACING METRO RAIL The Los Angeles Metro Rail subway project is already eight months behind schedule, and federal monitors warn that there could be additional delays if the RTD does not take quick action to resolve a number of problems. Here are some key trouble spots, according to the latest federal reports.

UNION STATION: Discovery of hazardous waste forced realignment. There also have been disputes over construction access and subway design issues with railroads that own Union Station. Problems related to treating contaminated ground water are worse than expected. This contract, which includes a tunnel to 5th and Hill streets and construction of a Civic Center station, is 23% complete, versus the 55% planned.

CIVIC CENTER STATION: Utilities found in locations different than those shown on RTD drawings. As a result, a temporary wood-beam roadway spanning the street had to be raised. Station construction plans must be modified to accommodate months of delay in completion of tunnel from Union Station.

5TH AND HILL STATION: Underground tanks containing hazardous waste discovered. Asbestos found in utility tunnel. Contractor seeking $3.5 million additional; says RTD delayed processing design changes and work orders. Actual progress 19%, versus 27% planned.

5TH AND HILL TO FLOWER AND 7TH TUNNEL: Dispute with contractor over soils data and RTD’s construction plans. Contractor has threatened work stoppage. However, work 37% complete, against 35% planned.

ALVARADO TO 7TH AND FLOWER TUNNEL: Mechanical problems with tunnel boring machine and other equipment slowed progress. Contract 24% complete, versus 37% planned.

MAIN SHOP BUILDING: Contractor says RTD slow in processing paper work and design changes. Contract 7% complete, versus 26% planned.

TRACK MAINTENANCE SHOP: Buried tanks found. Progress “keeps getting bogged down in details that could be resolved.” Contract 77% complete, versus 100% planned.