Bacon's Rebellion

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Uncertainties and Risks in the Charlottesville Bypass Bid

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James A. Bacon
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by James A. Bacon

Uh, oh, it looks like the bidding process for the Charlottesville Bypass is running into complications. Prospective bidders for the construction phase of the controversial project, estimated to cost $244 million, have lots of questions… and the Virginia Department of Transportation doesn’t have all the answers.

A document obtained by Charlottesville Tomorrow under the Freedom of Information Act responds to 220 questions submitted by firms formulating bids. Questions revolve around fundamental points such as traffic projections, noise analysis and bridge design. On 15 occasions in the 33-page document, writes Sean Tubbs, VDOT provides the following response:

The Department does not represent or warrant that the information contained in the supplemental information package is reliable or accurate or suitable for designing this project.

When VDOT does provide concrete answers, bidders may not always like them:

  • The contractor will be responsible for designing and paying for any environmental mitigations that might be required as part of a Federal Highway Administration review not due to be complete until later this year.
  • The contractor is responsible for acquiring any additional right-of-way that might be required to meet revised stormwater management requirements.
  • The winning contractor must produce a traffic study showing that its design for the 6.2-mile bypass and two interchanges can maintain a level of service of “C” — continuous and free-flowing — by the year 2036.
  • The builder must demonstrate to the U.S. Army Corps of Engineers that wetlands near the South Fork Rivanna Reservoir will not be impacted.
  • The builder must confirm with the Virginia State Historic Preservation Office that its plan avoids cultural-resource sites.
  • VDOT will not increase the $100,000 paid to each team for producing a qualified proposal.
  • To keep the procurement process on schedule, VDOT will not take time to answer any more questions.

The bidding process shows every sign of being rushed in order to meet a schedule imposed from above. Here’s what taxpayers have to worry about: Uncertainty will heighten the perception of risk among bidders. Bidders may feel compelled to pad their bids to offset those risks — better to lose the job than to win a money loser — and some may drop out of the bidding entirely.

I’m not sure what happens if the low bid exceeds the $197 million allocated by the Commonwealth Transportation Board to cover the balance of the project’s costs. Presumably, the administration will have to go back to the CTB and ask for a supplemental allocation. Given the way the administration hid the cost and design controversies raging inside VDOT at the time (see “In the Dark,”), the McDonnell team may have some explaining to do.

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9 responses to “Uncertainties and Risks in the Charlottesville Bypass Bid”

  1. larryg Avatar
    larryg

    what I got out of this is how could a bidder be sure of the things that would be to be built as part of the project like storm water or sound walls, etc.

    a low bidder could easily go broke if he calculated wrongly.

    think about this – the contractor guesses wrong..bids too low.. decides to get out before the job is finished unless VDOT covers the add ons.

    you can get a sense of how the bids are going to be written. No responsible company is going to enter into an agreement with unknown costs so they’ll configure their bids to protect their interests – as they should.

    this project is going to be exciting!

  2. DJRippert Avatar
    DJRippert

    Once again, you miss the point. This project is being rushed from above. Well, to the extent that getting something done 20 years after it was conceived can constitute rushing.

    It is being rushed because our state legislature is incompetent.

    Governors come and go in four year chunks. So do their Secretaries of Transportation. Yet, the state legislature is eternal. Yet, the state legislature has ineptly turned a blind eye to transportation problems for 25 years or more.

    A few failures of the General Assembly:

    1. A Commonwealth Transportation Board with representation based on Virginia’s population distribution in 1932. The General Assembly had the opportunity to rectify that glaring failure this session but decided to defer it to some later year.

    2. A gas tax frozen in cents per gallon since 1986. Apparently, inflation is one of those theories that our General Assembly either doesn’t believe exists or can’t fathom. There is yet another bill up this year to index the gas tax to transportation. We’ll see if the General Assembly has reached the 9th grade level of economic understanding to see why the costs of building and maintaining roads increase over time.

    3. There is no systematic ROI process for evaluating the payback of transportation projects. As far as I know, there isn’t even a proposed law up this year to remedy this oversight.

    4. De-volution of transportation to localities is a mish-mash where all cities and two counties maintain their local roads while all the other counties depend on the state. The two counties (Arlington and Henrico) receive wildly different allocations of gas tax proceeds without any cogent explanation of the allocation process other than, “that’s always the way we’ve done it”.

    Against this backdrop, a candidate for governor runs on a promise to fix transportation in Virginia. A full fix would require an almost total replacement of the General Assembly. However, every governor claims he or she will fix transportation.

    The big difference with Bob McDonnell (as opposed to, say, Tim Kaine) is that he is actually trying to fix transportation. In order to make any progress in four years he must “fast path” through the decades of incompetence put in his way by the General Assembly.

    Jim, if you think transportation is a mess in Virginia – at least have the open mindedness to lay the blame where it belongs – squarely on the narrow shoulders of our General Assembly.

    1. James A. Bacon Avatar
      James A. Bacon

      Don, I don’t know if this changes anything but I agree with you: The General Assembly must shoulder most of the blame for our transportation mess. It sets the rules and parameters within which VDOT and the localities must act. If there are systemic governance problems and faulty alignments of interest, then, under the Virginia Constitution, the G.A. is the only entity that can fix them. Fundamental change can come from no other source.

      So, now that we’ve properly trashed the General Assembly, let’s get back to the business of analyzing what needs fixing and how to fix it.

  3. larryg Avatar
    larryg

    here’s what we don’t do. We do not tell the jurisdiction that the maintenance and operation costs of a new road will come out of their annual allocations.

    If Cville were told that their allocation would be reduced by the construction, maintenance and allocation costs of the Bypass – would they think that was a good trade?

    Is the state promising to pick up the tab for the bypass not only for construction but operation and maintenance?

    Again – Cville…. Arlington, Henrico have no idea how much they generate in gas taxes nor do they have any idea how much VDOT actuall expends in new construction, maintenance and operations in their respective counties.

    Ideally – there would be two categories. 1. non-local roads (of state significance) and local-roads.

    you can see why neither VDOT nor the State legislature is particularly anxious to provide this kind of data… because it would almost surely lead to a lot of questions.

  4. TMT Avatar
    TMT

    Virginia is a good old boy state premised on the assumption that some people are better, smarter, blessed from above, etc. This belief, whether valid or not, is enshrined in the government structure. It is a strong legislature and weak executive state. Not quite the same as North Carolina, where the Governor cannot veto a bill, but still a weak executive state. There are no real provisions for referendum, repeal, and initiative. It’s easy to stop change, which the special interests love. Local government has limited powers, but a powerful excuse, which I think it prefers to expanded power. “I would love to ____________, but this is a Dillon Rule state.”
    People in NoVA are generally so focused on the federal government that they are generally clueless as to what goes on in Richmond. Many people in NoVA don’t even identify with the state, but rather where they were born, went to college, or used to work, etc. Most simply don’t engage in the process and when they do, they often wind up supporting things that are actually bad for NoVA. Look at the many residents of NoVA who supported Mark Warner’s tax increases even though the net impact screwed NoVA. The people cut the legs out from Chap Petersen and Steve Shannon who tried to get more K-12 education money for Fairfax County. When NoVA residents engage, it’s generally about K-12 education and generally only on the local level.
    For purposes of this discussion, I submit that the government of Virginia is working as designed and, on that account, works well.

  5. larryg Avatar
    larryg

    that’s FUNNY TMT – the “we know better than you” is the primary HIT that the right uses against LIBERALS! FUNNY!

    yes..the really funny thing about NoVa folks is they LOVE education and are willing to spend lavishly for it but they are skinflints for transportation and claim that is someone else’s problem to fix.

    Here’s another idea. Give localities the option of adding a 1/2% sales tax that can be spent on transportation including transit and rail but it comes with devolution strings.

    re: transpo “districts”.

    Congressional districts are done pretty much without regard to geographic community of interests or MSA economies.

    transportation /CTB districts need to be oriented to MSAs and counties that surround MSAs and orient economically to MSAs.

    Thats how the Feds do MPOs and to a certain extent that’s how Va does Planning Districts to a certain extent.

  6. TMT Avatar
    TMT

    Larry, a lot of the good old boys are far from conservative. For example, Gerry Halpin, formerly West Group, has been a very strong backer of Democrats and he has been looking for taxpayer subsidies for years. Til Hazel will support anyone he thinks will steer transportation money to projects near land he owns. Being a good old boy has all to do with power and little with political beliefs, IMO.
    The failure of NoVA residents to support more spending on transportation has to do with “it’s VDOT’s job” and from a true distrust of local elected officials to spend more money on something other than the good old boys’ projects. There are also a sizable number of people who oppose sprawl and see more transportation revenues as going to roads near good old boys’ rural land holdings.

  7. larryg Avatar
    larryg

    TMT – that’s why I think (major ) new roads should be toll roads. If they can “work” as toll roads they must be needed.

    I think the HOT lanes are going to help to better define what is necessary/needed congestion and what is not and to put a price on it to go with the “cost” of it.

    I think it was Albos blog today that says that there is no money for re-paying residential roads and no money for secondary roads.

    http://delegatedavealbo.wordpress.com/

  8. TMT Avatar
    TMT

    I am not against indexing the gas tax, but I first want to see the reforms that make sure the money does not become part of the slush fund and that Bob Chase is upset about the new rules. No adequate public facilities law; no gas tax indexing.

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