On Monday the Seattle City Council is scheduled to vote on a Memorandum of Agreement that would establish the $4.2 billion deep-bore tunnel as the city’s preferred alternative for the deteriorating Alaskan Way Viaduct (see Northwest Hub’s previous coverage of the bill here). The proposed deep-bore tunnel has divided the city—as well as the city’s mayoral candidates—and even sparked some lawsuits. A new report from Sightline Institute, a Seattle-based, nonprofit think tank, could dig the debate a little deeper.
The report, titled “Cost Overruns for Seattle-Area Tunnel Projects,” compares high-profile tunnels recently constructed in the area: the Mount Baker I-90 tunnel expansion, the downtown Seattle bus tunnel, the Sound Transit Beacon Hill tunnel and the King County Brightwater sewage tunnels. Meant to inform the debate over the proposed deep-bore tunnel, the report’s key findings suggest that cost overruns are common and even small ones could be costly for Seattle residents. It also suggests that the Mount Baker Tunnel, which came in under budget, may be a poor comparison to the proposed deep-bore tunnel.
The proposed deep-bore tunnel, which would replace the crumbling Alaskan Way Viaduct, comes with a price tag of $4.2 billion—the tunnel is an estimated $1.9 billion, but other projects such as reconstructing the seawall and reconfiguring surrounding streets add to the total. These numbers, the report notes, are very preliminary: “According to the state, engineers had completed only 1 percent of the eventual design work when they issued the estimates.” (Currently the project is considered to be 5 percent designed, according to the report, but the state has declined to release updated cost estimates until 15 percent is complete.)
A cost overrun of $100 million, which is just 2.4 percent of the project’s total cost, could cost a Seattle family of four almost $700, the report notes. A larger cost overrun of 25 percent could create more than $1 billion of new tax liability for Seattle taxpayers.
Cost overruns for tunnel projects are common: The downtown Seattle bus tunnel experienced a cost overrun of more than 56 percent, Sound Transit’s Beacon Hill tunnel exceeded expected costs by 30 percent, and King County’s bored tunnels for the Brightwater Sewage Plant are already over budget (the final overrun is currently unknown).
Overruns such as these aren’t unique to Seattle. Oxford University professor Bent Flyvbjerg surveyed 258 megaprojects from around the world, and found that 90 percent experienced cost overruns, with the average cost overrun at nearly 30 percent.
The cost estimate for the bored-tunnel alternative includes $420 million of “provisional risk cost,” which accounts for potential changes to scope, mitigation, right of way, issues during construction, risk (and opportunity), events and escalation of costs, according to the Washington Department of Transportation’s website. “Comparable tunnels recently completed around the world have been delivered for significantly less than the cost estimate per lane mile of the proposed SR 99 bored tunnel,” the website notes.
While many pro-tunnel advocates point to the I-90 expansion into the Mount Baker neighborhood—which came in at 54 percent under budget—the report warns against using that project as a yardstick for the proposed deep-bore tunnel. Savings were due to cheaper-than expected labor and materials costs and soil conditions that were well-understood. While the Mount Baker tunnel is similar in diameter to the proposed deep-bore tunnel, the deep-bore tunnel is nearly six times as long and surrounding geologic conditions are less-understood.
“Seattle’s experience with the construction of the downtown bus tunnel—which occurred during the same time period as the Mount Baker expansion tunnels—may prove to be a more apt comparison,” the report notes.
The downtown bus tunnel, which opened for bus service in 1990, exceeded cost estimates by 56.5 percent (it was estimated to cost around $299.6 million, but was completed for around $468.7 million). Unanticipated soil conditions, complaints from downtown interests and procurement problems all drove up the final cost of the tunnel.
Ultimately, the study comes up with two very different scenarios for the city:
“There is a chance that the deep-bore tunnel and related projects would end up costing less than $2.8 billion, in which case Seattle taxpayers would face no additional liability beyond the $900 million for which they are already responsible…On the other hand, there is a chance that the project will exceed its estimated costs. A 25 percent cost overrun beyond the project’s total price tag would saddle Seattle-area property owners with more than 1 billion dollars worth of new tax liability.”
Governor Christine Gregoire, former King County Executive Ron Sims and Seattle Mayor Greg Nickels have all voiced support for the deep-bore tunnel as the alternative to the Alaskan Way Viaduct; in January they signed a letter of agreement that “represents the governments’ commitment to this solution and outlines responsibilities for funding and implementation.” Only Monday’s city council meeting will tell if the city council will also jump “on-bored” [Ed’s Note: Sorry, we couldn’t help ourselves].
