Transit Way Construction on Santa Ana Freeway Near : Transportation: After four years and $4.9 million in design cost overruns, bids will be opened next month on the first segment of the project.

After four years and $4.9 million in design cost overruns, construction will begin this summer on a network of special lanes and ramps for buses and car pools on the Santa Ana Freeway.

Bids will be opened next month on the first, 4.5-mile segment of the project, near Grand Avenue. The job is part of a $440-million system of barrier-separated transit ways, all to be linked by existing and future car-pool lanes.

The ambitious project is unique in Southern California and will provide singular inducements to car-poolers.

But the near doubling of the cost of design so worried local officials that last year they forced the engineering firm to accept a cap on costs. And the oversight of the project by separate local and state road agencies has been called an example of how poor management can lead to the loss of millions of dollars in public funds.

“This was a case of how not to do a major public works contract,” said Stan Oftelie, head of the Orange County Transportation Authority. “Until recently, there was no end in sight to the costs associated with this project.”

Board of Supervisors Chairman Roger R. Stanton was even more blunt.

“It was hemorrhaging money,” Stanton said. “We had to do something to stop it.

“It should have been managed better,” he said. “I was very angry. . . . They just threw money at it.”

The transit ways are part of a massive, $1.8-billion Santa Ana Freeway widening effort--the county’s biggest public works project ever.

Transit ways provide ramps that carry only buses and car pools up and over congested freeway interchanges, enabling ride-sharers to remain in car-pool lanes while switching freeways.

The only similar lanes in Southern California are those on the El Monte Busway in the median of the San Bernardino Freeway east of downtown Los Angeles. But these lanes do not provide drivers with directly connecting ramps to car-pool lanes on other freeways.

When completed, the 19.4-mile transit-way system will be able to handle the travel needs of 150,000 people each day.

Design costs have climbed from $5.5 million to $10.4 million since the contract for the first design work was awarded in December, 1988, to Parsons Brinckerhoff Quade & Douglas--a major engineering firm that has received several county contracts.

The design project fell victim to a litany of problems, some caused by lack of coordination between transportation agencies, officials said.

To begin with, the Santa Ana Freeway transit way itself was an item added at the eleventh hour to the original freeway-widening project prepared by Caltrans.

As part of the deal they sought, county transportation officials offered to pay not only for the transit way and additional costs of required environmental reviews, but also for the Parsons firm’s redesign of the entire freeway section between the Garden Grove and Costa Mesa freeway interchanges.

At the time the contract was awarded to the Parsons firm, it represented a rare instance of the use of private firms for freeway design work. Previously, Caltrans engineers designed almost everything themselves.

Some OCTA officials said the contract was “dangerous” from the start because Caltrans could order many design changes knowing that the transit district would pick up the tab.

After some work was complete, for example, Santa Ana officials, among others, stepped in and requested changes involving water drainage and ramp designs.

Then in June, 1990, the contract was amended to add $1.43 million to the original cost because of additional work requested by Caltrans, records show.

In November, 1990, Caltrans decided to split the Interstate 5 expansion project into three parts, requiring the Parsons firm to prepare separate design packages for each--a decision that boosted design costs by $1.48 million.

And last August, the contract was revised upward again--this time by $1.95 million--to include a contingency fund and to bar future increases.

Caltrans also found fault with some of Parsons’ work.

“There were some instances where the contractor’s work was not satisfactory,” said Caltrans project supervisor Barry Rabbitt. “We sure as hell returned it so that nothing was accepted that didn’t meet (Caltrans’) standards. . . . The price (of the contract) has gone up because we’ve insisted that everything be brought up to proper quality.”

In an Oct. 28, 1991, letter to OCTA, for example, Rabbitt complained that Parsons’ design for one freeway segment was rejected for “incompleteness.” He added that another set of designs for the Grand Avenue interchange had been rejected “due to major inconsistencies” with previous plans and specifications.

Parsons’ project director, Don Cappelle, strongly defended both the cost increases and his company’s work product. “All of the increases were necessary,” Cappelle said. “. . . I’m very satisfied that our work is of high quality.”

Cappelle said every contract amendment that increased payments to his firm was “fully justified.”

“Sure, we had some problems,” he said. “This takes place all the time . . . when you get so many different layers of an agency involved.”

Cappelle was referring to the Caltrans bureaucracy, different levels of which had to approve different elements of the transit-way design package at different times.

“It was a nightmare,” said Cappelle. “You pull your hair out. But I think there is some light at the end of the tunnel.”

County officials simply view the transit-way contract as a costly learning experience.

Many of the contract changes, documents show, were approved by former Orange County Transit District Development Director Brian Pearson. Pearson strongly defended project costs as absolutely necessary, but he conceded that he handled the contract outside of normal procedures and authorized some additional work by Parsons before final approvals from higher-ups were obtained.

“We brought all the changes before the OCTD board before contract dollar limits were reached,” Pearson said.

Pearson recently left government work for a job with a private engineering firm. He said his departure was not related to controversy surrounding the transit-way project.

Oftelie said he became aware of cost problems on the contract after the Orange County Transportation District, which initiated the project, became part of the county Transportation Authority nearly a year ago.

Oftelie said he was dismayed to discover that “lower-level staff at Caltrans and OCTD could authorize hundreds of thousands of dollars in costs” on their own, without proper review.

“I was not satisfied with the chain (of decisions) and how this project was supervised. Obviously, mistakes were made and we were faced with taking steps to correct them,” Oftelie said. “And we did.”