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Town Square

On Deadline blog: 'Cal Ave' cost overruns may echo past, present and future city projects

Original post made by Jay Thorwaldson on Jan 31, 2013

The news that the California Avenue beautification project is exploding in its costs should not be a surprise to anyone even a bit familiar with Palo Alto projects -- of the past, present or future.

The overall cost has nearly tripled, from an initial $1.7 million in early 2011 (when the City Council approved the project) to an estimated $4.5 million today. The cost increases have followed a series of city decisions to redesign and add to the project, with wider sidewalks and -- currently proposed -- new street lights estimated to cost about $1 million.

But it wasn't the controversies that have plagued the project that have driven up costs -- such as the wholesale removal of the 63 or so former street trees on the commercial stretch between El Camino Real and the Caltrain tracks. Numerous merchants and residents also have expressed deep concern about the plan to narrow the lanes from four to two to allow wider sidewalks and landscape areas.

As with other cost-ballooning projects, the California Avenue project is being funded by a significant level of non-city funds, specifically a $1.2 million grant from Santa Clara County's Valley Transportation Authority (VTA). The city's share was to be about $500,000. It is not completely clear why the short, essentially dead-end street qualifies as a major VTA "transportation" project, other than the Caltrain stop at its eastern end.

Historically, one project stands out as an example of a grant-inspired city investment. It is known simply as "The Homer Tunnel." The bike/pedestrian tunnel (where Homer Avenue runs into Alma Street in downtown Palo Alto) more than quintupled in cost from initial estimates to its final cost of $5.4 million.

In addition to serious concerns about the design, especially for bicycles exiting onto narrow Alma or one-way-head-on Homer, the Weekly and others marveled unbelievingly at the cost explosion.

"Just as distressing is the $5.4 million latest cost estimates for the tunnel, several times the initial estimates of less than $1 million, or even the $2.2 million envisioned after the first design/engineering study," the Palo Alto Weekly commented in an editorial Sept. 22, 2004. It noted that the tunnel was "initially presented as costing local taxpayers virtually nothing due to potential grant funding and a $250,000 contribution from the Palo Alto Medical Foundation.

"But the price tag swelled past any rational limit due to a combination of state requirements coupled with add-ons from several city commissions and boards, plus an added track for "Baby Bullet" trains, and contingency costs of tunneling under a working railroad and relocating underground utilities," the editorial noted.

Sound familiar?

At the time, the Homer Tunnel on a small scale rivaled the cost increases plaguing the new eastern span of the Bay Bridge, increases that almost caused Gov. Arnold Schwarzenegger to cancel that project, now nearing its final stages as a world-class structure.

The late former Councilman and Mayor Gary Fazzino just shook his head as he drove past the new Homer Tunnel -- questioning its worth in the big picture of city investment in infrastructure. Its defenders cited its contribution to the economics of downtown Palo Alto by linking it more closely with the Palo Alto Medical Foundation and large hotels adjacent to it.

On a trip to southern New Zealand I took a photo of a "Homer Tunnel" through a mountain and sent it back to Weekly staffers, wondering if it cost as much as the Palo Alto version.

Downtown parking structures also have carried high price tags. At a luncheon meeting with Weekly editors, Stanford University President John Hennessy informally quipped that Palo Alto's then-new structure on Alma Street cost about twice what a similar-sized parking structure cost Stanford.

I was not surprised: On a walking tour of the Alma Street structure I was impressed by the thin stainless-steel cables enclosing the stairwells. I had once replaced a couple of stainless-steel stays on an old sailboat and knew their solid-gold cost, even many years earlier.

And we're not done yet, it seems.

Other projects seemingly on their way over the top include a major bicycle/pedestrian bridge over state Highway 101 to the city's expansive natural baylands, and a new plan for a pedestrian/bicycle trail along Matadero Creek in Midtown Palo Alto.

The 1.3-mile creekside trail is still in a conceptual phase, but the bridge is moving along through city approvals.

The bridge is estimated to cost about $10 million, of which so far $4 million would come from a grant from Santa Clara County. Early design concepts show a sweeping overpass structure creating an architecturally impressive gateway to the baylands for south Palo Alto residents and others. It would avoid the inherently dangerous San Antonio Road vehicular overpass and supplant the Adobe Creek bike/pedestrian underpass that is flooded out for half the year -- for all year this year, in fact.

There is still discussion about the eastern alignment and its impact on the baylands, both during construction and visually. Planning Commission member Arthur Keller in December suggested straightening the eastside alignment to aim it more directly at entrances to trails in the baylands and create a more cohesive appearance.

The bridge is scheduled to open by 2017. Its ultimate real-world cost has not yet been guesstimated, beyond the initial $10 million estimate. Will it follow what former city Chief Transportation Official Joe Kott once termed the "Palo Alto cost" pattern? There certainly are many opportunities in this one. Stay tuned.

Finally, the Weekly this week is reporting on a relatively new plan to construct a bicycle/pedestrian trail along Matadero Creek in Midtown Palo Alto.

Like the baylands bridge, it also ties into the Stanford and Palo Alto Trails Program, which would expand or create more than eight miles of recreational corridors. The program would eventually link San Francisco Bay trails to Stanford University and city's Enid Pearson Arastradero Preserve. The trail is considered a key element of the city's 2012 Bicycle and Pedestrian Transportation Plan (adopted by the City Council last July) and would link with future bike boulevards along Ross, Greer and Louis roads.

As outlined so far, most of the trail would follow an existing county water-district maintenance road along the north side of Matadero Creek, except from Middlefield to Ross roads where it would shift to the south side.

But planning and assessment of the trail, and its alignment, won't even start until after the new city budget year begins in July, with a feasibility study scheduled to start in the fall. Some residents already are expressing concerns that the trail comes too close to their back yards, one woman saying it would be just six feet from her house. Privacy and safety will be issues, and even the necessity for any trail compared to side streets.

Palo Alto has received a $1.5 million grant for the trail from Santa Clara County, and the city could contribute about $500,000 from its 2014 Capital Improvement Program budget, according to city Chief Transportation Official Jaime Rodriguez.

So we have a $2 million estimate on the table. Do I hear three?

NOTE: Former Weekly Editor Jay Thorwaldson can be e-mailed at jthorwaldson@paweekly.com with a copy to jaythor@well.com. He writes regular print columns for the Weekly and blogs at www.PaloAltoOnline.com (below Town Square).

Comments

Posted by curmudgeon, a resident of Downtown North
on Jan 31, 2013 at 5:23 pm

You ain't seen nuttin' yet. Watch the dollar signs rack up at the new toy our starry-eyed city is eyeing now -- the so-called garbage to energy factory by the Bay. Its projected base cost is already well into the millions, and even before it gets built it needs a perpetual land rent subsidy from the city, so its overages can be expected to dwarf the sum total of the fubars that Jay listed.


Posted by Wayne Martin, a resident of Fairmeadow
on Feb 1, 2013 at 2:33 pm

Because the City is not a for-profit entity, it has failed to have developed a management structure like the private sector has--relative to running projects and accounting for resources (money and time). The concept of "True (or Total) Cost" is hard to find in most City documents. Although there was a change in how multi-year projects were accounted for over the past few years, there does not seem to be any sense of reporting to the public the True/Total cost of projects that are under the City's control.

There has never been any effort on the part of the City Auditor to review these projects, as a part of the Auditor's yearly work plan. The City Council is not responsible for any aspect of a project's execution—unless it becomes such a problem that there is public outcry, up to, and including, a recall.

The biggest problem seems to be that there just isn't anyone who is accountable—like the CEO, of a company. The City Manager's name rarely appears in any articles involving construction project problems—like we're seeing at Mitchell Park. The Assistant-Director of the Public/Works Department seems to be the only City Official who seems to be visible in the decision process. There are nine City Council Members, a City Manager, a couple Asst. CMs, a City Attorney, a P/W Director and a Library Director who have been involved in the decision processes—yet, few of these people seem to explaining what the problems are—other than some hard-to-believe claims of "cheap subcontractors).

Since none of the key City officials seem to be accountable—meaning they could lose their jobs for failures to perform—then schedule delays, and ultimately cost-overruns, become business-as-usual at 250 Hamilton.

The thought of giving the City hundreds and hundreds of millions of dollars it claims is needed for "Infrastructure" leaves one wondering how the same people that can not bring in a small $2M project at/about cost estimates will not go hog-wild and blast through those funds the same way they have the small projects in the past? Bond oversight committees are toothless, and rarely are populated by people with any particular expertise in construction—leaving them to be little more than cheerleaders for the people who appointed them to the committee.


Posted by pat, a resident of Midtown
on Feb 1, 2013 at 9:52 pm

Let's not forget the Mitchell Park Library/Community Center overruns.

Accountability is not a word in the City Hall lexicon.


Posted by pat, a resident of Midtown
on Feb 2, 2013 at 12:08 pm

Speaking of accountability, the same city engineer who was in charge of the Homer Tunnel and declared it "a total success"
Web Link
is in charge of the proposed bike bridge over 101.
Web Link


Posted by Cedric de La Beaujardiere, a resident of Barron Park
on Feb 3, 2013 at 12:45 am

Cedric de La Beaujardiere is a registered user.

I'm dismayed to see the costs of Cal Ave go creeping up, but widening the sidewalks in conjunction with the streetscape work is good timing and will I think pay off in the long run. I look forward to more places to sit and eat outside, especially during the farmers' market, when people are eating sitting on the curb between Country Sun and the Bank. The bike flow to/from the Cal Ave underpass will be improved and have fewer conflicts with pedestrians on the plaza (see page 18 of Web Link).

The plan currently calls for additional on street parking, a valuable asset to merchants and shoppers, with each new space representing an approximately $40K value (per previous community meetings and the cost of adding parking elsewhere). Mr. Thorwaldson and readers should note that this additional parking is not possible without reducing the number of lanes. So the lane reduction is not just for sidewalk and landscaping, but also for more parking and for safer pedestrian mid-block crossing.

Thanks for the link about the Homer tunnel. A fair reading of the article will show that most of the cost overruns for that project were caused by outside agencies and regulators and outside of the city's control, certainly outside of the city engineer's control. One decision that was in the city's control was the retention of the monument in its original location, which I thought at the time was fairly ridiculous. It forced some redesign of the exit, IIRC, and limits visibility into the tunnel from Homer, thus slightly reducing security (though I know of no security incidents there since its opening). But that too, a decision of the Council or maybe the HRB, was outside the engineer's control. Now I use the Homer Tunnel about 95% of the time I bike to downtown. Living West of the tracks, I rarely use Bryant anymore. I use the Alma connection to Forest and have never had a car catch up to me, though I have some hope that the contra-flow bike lane may get put in before too long.


Posted by pat, a resident of Midtown
on Feb 3, 2013 at 1:47 pm

> "...most of the cost overruns for that project were caused by outside agencies and regulators and outside of the city's control,..."

It's up to the city staff to hire competent contractors and to scope out the dependencies and costs before the project is approved. Projects with "exploding costs, construction snafus, months of delays and an unlawful traffic signal" are indeed the fault of the people managing them.

Former Mayor Gary Fazzino was right when he called the Homer Tunnel "one of the biggest mistakes during his 12-year term on the City Council."


Posted by Cedric de La Beaujardiere, a resident of Barron Park
on Feb 3, 2013 at 11:27 pm

Cedric de La Beaujardiere is a registered user.

Good point on the need to hire competent contractors to get accurate cost estimates.

On the "unlawful traffic signal", a green traffic light in the shape of a bicycle-logo, it was legal when first proposed, but it was only temporarily legal as a trial. The legislation permitting them in California expired in January 2005. However, it was reinstated in July 2005, and is still legal today: Web Link


Posted by Oversight?, a resident of South of Midtown
on Feb 4, 2013 at 11:03 am

> Bond oversight committees are toothless, and rarely are populated by people with any particular expertise in construction—leaving them to be little more than cheerleaders for the people who appointed them to the committee.<
This is an accurate description of the Library Bond oversight.
NINE city staff are on it. NINE! And the few citizens (4?) were bond advocates for the Mitchell Park boondoggle.


Posted by Joe, a resident of Another Palo Alto neighborhood
on Feb 4, 2013 at 1:13 pm

Bond Oversight Committee:
Web Link

There are a few City employees associated with this committee, but they are not offically named to the committee.


Posted by Lane-Reduction-Isn't-Worth-It, a resident of Another Palo Alto neighborhood
on Feb 5, 2013 at 12:44 pm

> The plan currently calls for additional on street parking, a valuable
> asset to merchants and shoppers, with each new space representing an
> approximately $40K value (per previous community meetings and
> the cost of adding parking elsewhere).

Statements like this one are so full of holes that they should be filled under the Swiss Cheese section.

A small number of additional parking spaces are supposed to result from this plan. However, there has never been any evidence presented that the off-street parking is saturated. It's clear that this is not so, or if it ever is so—this saturation is only during lunch hour on work days. There has been no data presented about the utilization of the parking structure.

As to the $40K/per parking space—this is only true in the context of a parking structure—and then only if the construction is not funded with bonds—which will then drive the cost per parking spot up. Street level parking lots are clearly less expensive to build, although their capacity is limited to only one "floor".

Given the escalating costs of this project—the hand full of new parking spaces are becoming more expensive by the day. It's hard to find an estimated cost for on-street parking, but this fifteen-twenty new spots will not come cheaply—nor will there be any increased sales associated with these new spots.


Posted by Ann, a resident of Midtown
on Feb 5, 2013 at 1:32 pm

What about those projects for new buildings on California Avenue that will cause all kinds of issues for the project? I just saw something that the 260 California Avenue building and will occupy some parking spaces in front of their property. Does anyone anything about this or how we can get more information on this? These projects may be taking away some public parking spaces that we just can't afford-anywhere in Palo Alto for that matter. Maybe Mr.Thorwaldson, can do a thorough analysis of these projects on California Avenue as I only learn about them in limited information. For example, I only learned about this cost going up this high from this blog. The City must have known that the cost was creeping up, we should be able to get all of the information before it gets to this point. It is really hard to find a comprehensive information on these types of issues.


Posted by Ann, a resident of Midtown
on Feb 5, 2013 at 1:32 pm

What about those projects for new buildings on California Avenue that will cause all kinds of issues for the project? I just saw something that the 260 California Avenue building and will occupy some parking spaces in front of their property. Does anyone anything about this or how we can get more information on this? These projects may be taking away some public parking spaces that we just can't afford-anywhere in Palo Alto for that matter. Maybe Mr.Thorwaldson, can do a thorough analysis of these projects on California Avenue as I only learn about them in limited information. For example, I only learned about this cost going up this high from this blog. The City must have known that the cost was creeping up, we should be able to get all of the information before it gets to this point. It is really hard to find a comprehensive information on these types of issues.


Posted by Mr.Recycle, a resident of Duveneck/St. Francis
on Feb 7, 2013 at 3:50 pm

Sad, but these kinds of overruns are the norm for big government projects, There is a lot of incentive to spend more, and not much to spend less. Current high speed rail estimates are $60-90 billion. Apply the standard multiple and you get a bankrupt state.


Posted by Marrol, a resident of Embarcadero Oaks/Leland
on Feb 17, 2013 at 10:05 am

Just another example of justifying the use of city funds based on the rationale that "grant money" is covering a majority of the expense. Also as expected, the cost overruns will fall firmly on the shoulders of we tax payers. Considering the dire financial straits we're in, and inability to even come close to balancing the city budget, it was clear that we couldn't afford the original half million dollar proposed cost.

This beautification project represents a desired need, but not an essential need. Like many other publicly funded programs and services in Palo Alto, we should have shelved this project until our fiscal situation is healthier. Vital civic needs in infrastructure and public safety have been neglected and deferred for many years in favor of non-essential, feel good, niche projects. We have to attend to those needs and balance the city budget before we embark on costly ventures like this one.


Posted by Larry, a resident of Old Palo Alto
on Feb 18, 2013 at 12:05 pm

Marrol, I agree. I say let's dump this project and just resurface, repair and replace as needed. Has Palo Altans come to this point that we can't even manage a 3 block business district of our small town and yet PA is a home to some of the most qualified CEO's in the country? If this California Avenue project goes through, we will begin to lose small businesses then we also lose our quaint town mentality and just become part of the next big thing. Why aren't people questioning the fact MOST businesses on California Ave. opposed this project enough to file a lawsuit? It just doesn't make sense. The businesses would rather have the street untouched than to reduce lanes to only see increased traffic and parking issues not effectively addressed. Why are the small businesses of PA are largely ignored? We saw this when Pat Burt, an elected Official had a tantrum basically yelling at the businesses who came to express their views back in July 2012. Like the rest of the government, Palo Alto is no different, it is highly influenced and organized by, to me, lobbyists (bicyclist groups)--let's call them for what they really are and the few ambitious Council members and staff personnel to ONLY further their own cause. If the City Council has the encourage they will dump this project and save our City some money. Instead their efforts should be to update California Avenue area with better signage, newly painted crosswalks, etc... The City has wasted our money on useless consultants to tell the California Avenue merchants what THEY need. We pay for consultants on every project, what is the point of hiring overpaid City Staff? Why do we have a City Council if they do not govern? Why not just hire "real" qualified City staff since they are the ones running the City as we ALL know. Apparently City Council doesn't care, read Daily Post Feb.13, 2013 "Grant bid for huge garage blasted".


Posted by Observer, a resident of Evergreen Park
on Feb 18, 2013 at 5:53 pm

Larry remembers: Pat Burt, an elected Official had a tantrum basically yelling at the businesses who came to express their views back in July 2012.
Burt's private business office is on California Avenue so he should not have participated in the issue at all.
That's the private office he shares with a member of the Planning Commission. And he invests in that commissioner's businesses too. Burt used to be on the Planning Commission. They both have a very "flexible" interpretation of conflict of interest.


Posted by Larry, a resident of Old Palo Alto
on Feb 19, 2013 at 9:39 am

The question of our own Council members not to raise this is utterly unaccepted. Someone could have asked Burt to remove himself from this issue. This is our local government at it's best. PA praises to be a community on the cutting edge of innovation, green environment and now they can add CORRUPTION. PA is on sale to to the highest bidder! Observer, do tell more as I think people are unaware of this.


Posted by pat, a resident of Midtown
on Feb 19, 2013 at 9:45 am

> Palo Alto "is highly influenced and organized by, to me, lobbyists (bicyclist groups)--"

Yes, the bicycle lobbies have huge power. Here's an example from San Francisco:

SF city planners want to move bike lanes from Market to Mission to provide more room for buses on Market(thus faster commutes) and more safety for cyclists on Mission. But the bike lobby -- which has so much political power -- won't give up Market Street. They convinced SF Supervisor Scott Wiener to call for public hearings.

"What's really at play here is a looming fight for space between cyclists, pedestrians and Muni passengers now that cars are being pushed out of the Mid-Market area."
Web Link