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Federal Transit Administration, Sound Transit, University Link, Grantee Risk Mitigation Plan
The greatest risk to this project is that costs will overrun and the Full Funding Grant Agreement (FFGA) with the FTA will be endangered. Through a Project Management Oversight Contractor (PMOC) contract, Burns is working to make sure the targeted price is achieved and the risk of project overruns is minimized.
This $1.9 billion,3.1 mile alignment will be entirely underground, travelling underneath the Capital Hill District and the Lake Washington Shipping Canal, and will connect downtown Seattle and the University of Washington Campus. The U-Link line is scheduled to open in 2017 and is projected to add more than 40,000 daily riders to the system.
Due to the size of the project and its critical nature, the FTA assigned Burns to assess the tunnel and geotechnical risks, the project cost estimate and the schedule achievability, as well as to develop a Project Risk Mitigation Plan. Burns’ PMO staff has significant expertise in identifying and analyzing what we consider the four major project uncertainty elements, or risks of how and why projects exhibit over-expended cost and/or schedule. These elements are: correlation of scope and cost estimate; competitive analysis of the bidding environment; general conditions; and weighted contingency.
The first project uncertainty element analysis considers the correlation of scope and cost estimate. Burns performed project scope analysis to confirm that all project requirements were adequately identified in the cost estimate, to identify undefined project scope requirements, and to ensure the cost estimate truly reflected the desired work scope, particularly for the major tunnel construction element.
Our second project uncertainty element analysis considers a competitive analysis of the bidding environment. For this project, Burns compared the potential cost increase to the U-Link project against the cost engineering data and trends, using data from current projects, academic studies and information about the competitiveness of the bidding environment. This allows Sound Transit (ST) to plan for a contracting strategy, a bidding strategy and project delivery method selection.
Our third project uncertainty element analysis considers general conditions (GC) to ensure all costs related to GCs and Indirect Costs (IC) are captured. The definition of the GC/ID items will help ST develop a more accurate cost estimate.
Our fourth project uncertainty element analysis considers a weighted contingency analysis for the project based on the development level of the individual contract packages, and the program experience of over 28 major capital projects.
As a result of Burns’ evaluations and analyses, ST and the FTA were able to establish a “Project Execution Plan”. This plan identifies required management deliverables and actions to provide a high-confidence cost estimate, as well as contingency “thresholds and targets” and project reserve accounts to serve as a basis for a Full Funded Grant Agreement (FFGA) budget.
For more information on Burns’ Risk Assessment Services for major transit projects, please contact Dan Reich at dreich@burns-group.com or (214) 800-2669.
Posted on Apr 7, 03:25 PM