The Port Authority board of directors awarded a $156.5 million contract yesterday for construction of two Light Rail Transit tunnels under the Allegheny River.
Two members dissented, saying they were worried about undertaking such an expensive project in the face of looming financial problems.
The contract with North Shore Constructors, a joint venture of Trumbull Corp. of West Mifflin and Obayashi Corp. of San Francisco, is the first of 16 to be awarded as part of the $435 million North Shore Connector to extend the light-rail system to the North Side.
Yesterday's 5-2 vote was one of the last remaining approvals needed to get the controversial project, a decade in the making, off the ground, or in this case, into it. Voting against the contract were directors James Dodaro and Joan Ellenbogen.
Construction is expected to start in early fall after a 60-day congressional review period, considered a formality, ends Sept. 6.
One of the first tasks will be to build a 46-foot-deep "launch pit" on the North Shore near the stadiums that will prepare the way for the drilling of the twin tunnels, one inbound and one outbound. That work probably will start next summer. A similar "receiving pit" will be built on Stanwix Street, Downtown, near Penn Avenue.
The Port Authority decided to move forward with the project despite a rapid escalation in its cost. The project has increased $42 million in a little more than a year, and the authority rejected a first round of bids that arrived 25 percent over budget.
The extra spending must be approved by the Southwestern Pennsylvania Commission, which will meet July 31 to consider an amendment to the region's transportation funding program.
Despite the high costs, the project, given the amount of federal and state money behind it, "shouldn't be abandoned," board member Jeffrey Letwin said.
The federal government will pay $348 million toward the project and the state, $72.5 million. The county share would be $14.5 million.
If the Port Authority rejected the contract, it could be another decade before it gets the chance again to extend the light-rail system to the North Shore, Mr. Letwin said.
"I'm not prepared to walk away from the significant investment the federal government and the state put into this," he said, adding the extension not only will be a catalyst for development but could lay the groundwork for future extensions to Oakland and the airport.
Questioning whether light-rail should be extended to Oakland or the airport first is largely irrelevant, he said, noting that the decision to go to the North Side was made by previous directors.
"We don't have a choice of projects today," Port Authority Chief Executive Officer Stephen Bland said. "It's a choice to move forward or not to move forward."
Mr. Dodaro said he could not "in good conscience" vote to get the costly project going at a time when the Port Authority is facing a $31.5 million operating deficit next year, $88.1 million in 2008, and $133.3 million by 2011.
"The thing that really creates the concern for me is that we are an agency that's on the verge of bankruptcy," he said.
He said he voted "no" out of a "fiduciary responsibility" to bus and light-rail riders.
"We cannot expand this system at the expense of those core customers," he said. "Anything that we do now, given this unstable financial situation, that would adversely impact that core situation I believe would be irresponsible."
While costs have escalated on the project, Mr. Dodaro said the Federal Transit Administration has indicated it "won't put one more dime" into it. He noted that County Council also expressed concern about the growing price tag.
Council members this week passed a motion telling the Port Authority that they wouldn't commit more than $12.7 million in county money to the project, nearly $2 million less than the amount now needed.
"We're not going to go beyond that amount," council President Rich Fitzgerald, D-Squirrel Hill, said.
Allegheny County Chief Executive Dan Onorato described council's action as "prudent," and said he would work with the body "at $12.7 million to keep this thing under budget."
He said there may be a need for private investment in the project, particularly if costs continue to soar.
"We have a lot of private developments on the North Shore that benefit, from housing to Pittsburgh Live, which is that entertainment center [the Steelers are] proposing to build. The Carnegie Science Center, the community college will be served with it," he said.
Council members also would like to see connections to the David L. Lawrence Convention Center, Downtown, and Community College of Allegheny County's North Side campus. Both proposals were part of the original plans but have since been removed because of high costs.
Mr. Bland said the North Shore Connector would have a relatively minor impact on the authority's operating costs. The light-rail system accounts for about 16 percent of overall spending, he said.
The Trumbull-Obayashi $156.5 million bid includes not only the boring of twin tunnels under the river and lining them with concrete, but excavating 1,200 feet to transition the tracks to ground level west of PNC Park, excavating Stanwix Street between Fort Duquesne Boulevard and Liberty Avenue to extend the subway north of the Gateway Center station, and building new station shells Downtown and in a publicly owned parking garage on the North Shore near the stadiums.
While Mr. Onorato wants to hold down the cost, he said he believes the project should go forward.
"It's use it or lose it," he said of the federal funding, "so we're going to move ahead, it appears, with the Port Authority's vote today. We've got to make sure, though, this becomes part of the overall linkage [to Oakland and the convention center]."John Beale, Post-Gazette
Daniel J. DeBone, left, and Catherine Williams, who work for the Port Authority, listen to public testimony before the vote by the authority board to approve construction of twin light-rail tunnels under the Allegheny River to connect Downtown to the North Side.
Click photo for larger image.
Staff writer Jerome L. Sherman contributed. Mark Belko can be reached at firstname.lastname@example.org or 412-263-1262.