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Emory Bundy's February 2003 Report on Sound Transit

On February 5, 2003, noted Sound Transit critic Emory Bundy submitted a 21-page report on Sound Transit as testimony before Senate Transportation Committee. Below is a summary of the report and a link to the full document.

>> Download full report (21-page PDF)

Summary

  • The cost of the Link light rail project was misrepresented to voters in 1996. The price reflected what Sound Transit's polls showed the voters would approve--not the true costs. The current estimated cost of Initial Segment is three-times higher than represented. Sound Transit's current claim, that only $1.3 billion more, plus 25 percent for soft costs, would be sufficient "to get to Northgate," is similarly false. Citizens who asked for an independent audit in August 2000, who said Sound Transit was at least $500 million over budget, were accused of "twisting the truth." Three months later, Sound Transit admitted a $1 billion cost overrun for 21-mile Central Link, added another $560 million a month later, and since then the cost just of Initial Segment has escalated $1+ billion more.
  • The performance audit of Sound Transit, by Deloitte & Touche in August-September 2001, found the agency made its costs fit its budget, was much too optimistic about costs, had inadequate contingencies, inadequate data, insufficient overhead costs, and an unrealistic construction schedule. Appendix A of the Bundy Report shows how the scope of the performance audit was scaled back and minimized by the Sound Transit Board. Originally, it was supposed to address the central question, "What went wrong?"
  • The Boston Big Dig, which also had Parsons Brinckerhoff as a key project manager, in partnership with Bechtel, used similar techniques to hide the true costs. In that case the top Bechtel manager warned, correctly, that costs were misrepresented by $6 billion. He was removed, and a pliable replacement was recruited. As the cost estimates, here, of Parsons Brinckerhoff and its Puget Sound Transit Consultant partners, have proven similarly deficient, Sound Transit has nearly tripled their contract, from $26 to $71 million.
  • The State of Washington, alerted to a pattern of underestimated costs and exaggerated benefits in rail transit projects, identified by a senior economist at USDOT, created an Expert Review Panel (ERP) to make sure that wouldn't happen here. Yet Sound Transit's cost estimates, seconded by ERP, have proven even worse than the norm. Also, ERP's ridership estimates have never been reexamined. If they are merely average, they will amount to half the riders Sound Transit predicts.
  • In 2001 Sound Transit created a purportedly "independent" Project Review Committee. Several of its members had severe conflicts of interest--their firms work for Sound Transit, or they work for the chairman of Sound Transit's board. Sound Transit's management--Joni Earl, particularly--assigned its pubic affairs consultant, Cocker Fennessy, to meet secretly with hand-picked members of the PRC, and its staff, for "strategy sessions." Sound Transit's PR head, Ric Ilgenfritz, was involved, too. Cocker Fennessy then helped write the final PRC report. It said, Build!--and there's enough money with existing taxing authority to complete 21-mile Central Link. (Appendix B of the Bundy Report lists PRC-related work done for Sound Transit by Cocker Fennessey. Appendix C summarizes the report.)
  • Several of the mechanisms the altered PRC report suggested for making the 21 miles affordable, with current taxes, violate 1996 promises to the voters, and current Sound Transit Board policy. They include lowering the debt service ratio and changing the rules for subarea borrowing. Instead of bringing accountability to the project, the Project Review Committee has repeated the pattern of misrepresentation.

Emory Bundy's background

Former director of the Bullitt Foundation.
Former director of public affairs, King Broadcasting Company' co-chair of Citizens for Mobility.
Board member, Sane Transit.
Columnist for Seattle Business Magazine, 1985-1990.
Director of the US/Soviet Exchange Program for the Seattle Goodwill Games, 1990.
Recipient of Society of Professional Journalists' national public affairs award, for The Eighth Day, on the future of the environment of the Puget Sound region, 1971.
Recipient of the Champion Media Award for Economic Understanding, for major US television markets, for The Electrical Storm, on the Northwest's nuclear power projects, 1983.

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