The design error that required a nearly $1 million makeover of a Nalley Valley viaduct offramp was a doozy, but such costly errors are rare, state transportation officials say.
Eight times in the past five years in the eight-county Olympic Region, which includes Pierce County, has the department had to tear up and replace what had already been built on highway projects. Department errors caused half of the rework; unforeseen circumstances the rest.
Total cost to taxpayers: $4,765,270.
In the wake of the Nalley Valley ramp mistake, The News Tribune asked Olympic Region officials to review their projects for the past five years and provide data on those that cost more than $100,000 and required new construction.
The department looked at 192 projects, costing a total of $1.972 billion, that were active in the region during the five-year period. Eight met the criteria, officials said.
They included two projects on state Route 16: the Nalley Valley ramp – which was built too high and too close to the highway – and a $500,000 redo of a too-low noise barrier near the Sixth Avenue exit. Both were caused by Transportation Department design errors.
Other rework included rumble strips that shouldn’t have been placed along two highways in Kitsap County and 18 concrete bases for pole lights along Interstate 5 in Tacoma that were designed too small.
The largest rework was $2.68 million to remove foundation work on a dock in Port Angeles. The work was needed after the site turned out to be atop an ancient American Indian village unearthed during construction.
Large construction mistakes such as the Nalley Valley ramp are costly and embarrassing but are not indicative of the work done by the department staff members statewide, said Kevin Dayton, the Olympic Region’s administrator.
“This region, and the department for that matter, has a very good record of delivery,” he said. “As rare as (rework) is and no matter how small it is, it still is an embarrassment. Four million in rework may not seem like much in the grand scheme of things, but we are very cognizant of it. It’s real money.”
His boss, Transportation Secretary Paula Hammond, said the Nalley Valley ramp mistake has led to a new policy statewide.
“The new rule is no rework is done until I have a personal conversation” about it, she said. “ You try not to say anything is OK, but in reality you have realize people will make mistake.”
In gathering the information on the rework projects, Transportation Department staff members examined all “change orders” on the 192 projects. The department uses the orders to amend or change its contracts with contractors.
Changes are needed when errors in the design plan are found, or when criteria change, contract conflicts or ambiguities are found or when extra work or unforeseen needs arise due to bad weather or soil conditions, officials said.
Sometimes the process results in the contractor being paid more, sometimes the state saves money and sometimes the change results in no cost for either party.
Change orders are part of any construction project, Dayton said.
“Anytime a specification (in a contract) has a conflict or there is an ambiguity, we clarify with a change order,” he said.
Most change orders are written and approved by both sides, and any cost is negotiated. Approval authority for change orders depends on the cost. Anything over $500,000 must get Dayton’s OK.
Total value of the 2,315 change orders for the 192 projects came to $198.5 million. Of that, $123 million was spent on the Hood Canal Bridge project when the project had to be redesigned after the Native American village was discovered. The work was so substantial that it required renegotiating a new contract.
Fifty-seven percent of the change orders required paying contractors extra money, 11 percent saved the state money and 32 percent were done without cost to the state or to contractors.
Most of the change orders – 85 percent – were for less than $20,000. Ninety-seven had a value of at least $100,000 for a total of $51.4 million. Seven of the $100,000-plus change orders were needed to correct work already done. Work on the eighth – the noise barrier on state Route 16 – was not handled as a change order but with a separate contract, in part because finding the money to correct the mistake took four years, officials said.
Of the 192 projects reviewed, Dayton said, the total value of change orders came to just under 4 percent. That is within the state’s 4 percent contingency that is set aside of all projects to pay for errors, omissions and unforeseen conditions.
For the westbound Nalley Valley viaduct, the contingency fund is about 5 percent – $6.1 million – due to the project’s complexity and some risk factors special to the site, Dayton said.
In negotiating contracts for construction projects, the state doesn’t require contractors to take all the risk for added work and errors, he said. The department accepts certain risks to save money in the long run. If the state put more of the risk on the contractors, they then would come in with higher bids, Dayton said.
“By assuming risk for (certain) unforeseen conditions, the state receives the benefit of lower bids (from contractors) up front,” he said.
Unused contingency money comes back to the state’s transportation fund.