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Surprise cost hikes cause disarray for Fillmore, Cimarron interchange projects

In a photo from last August, emergency crews attend to an accident on the northbound side of I-25 above Cimarron Street. The half-century-old interchange and its ramps are to be replaced, in large part for safety reasons.
Westside Pioneer photo
       While the actual work is reportedly not in jeopardy, state and local officials are scrambling to rearrange funding and schedules for the Fillmore and Cimarron freeway interchanges as the Colorado Department of Transportation (CDOT) comes to grips with a dramatic rise in contractor costs.
       The first local indication was in September, when the low bid for a replacement interchange at Fillmore/I-25 came in about $2 million above CDOT's $13 million budget.
       Then, at the Pikes Peak Area Council of Governments (PPACG) monthly board meeting Oct. 8, CDOT Region 2 Director Karen Rowe revealed that the Cimarron/I-25 interchange - a more expansive project than Fillmore with a former budget of $95 million - is facing a 20 percent cost hike.
       Rowe's comments, in addition to a separate interview with Mark Andrew, a resident engineer for CDOT's Region 2, painted a picture of how the lean times for statewide contractors in recent years - allowing lower construction costs on public projects - have come to an end. Both noted that more public projects are currently being advertised (including repair work related to flood and fire disasters), which makes potential bidders less desperate. Also pushing bids upwards, contractors are facing inflation in such areas as trucking, labor and concrete, Andrew pointed out.
       The board received assurances from state and local staff that the money for both Fillmore and Cimarron will be found. However, the reallocating process will slip Fillmore's construction start - which, until the bids came in, had been expected to occur this month - to January or even March. A delay also appears likely for Cimarron.
       Completion for Fillmore - a roughly 18-month job - is now seen as summer 2016, Andrew said.
A view east on Fillmore Street shows the current layout of the Fillmore/I-25 interchange. A project to replace it was to have started this month, but has been delayed until January or possibly even March because of its higher-than-expected costs.
Westside Pioneer photo
       CDOT had previously announced that the new Cimarron interchange would open in July 2017. Rowe said that could slip to October 2017, but that's not certain yet. In any case, the Cimarron schedule that had originally called for contractor bids in November now says January, she said.
       Making up the cost differences on both projects will require the reallocation of millions of dollars in transportation funds, leading to possible delays for other local projects. What exactly will be affected, and to what degree, is being decided.
       “We are working with [City Transportation Manager] Kathleen Krager to come up with a plan to provide additional funds as well as to keep other projects moving in the Pikes Peak region,” Rowe told the board.
       For Fillmore, which is closer to construction than Cimarron, part of the new deal involves Colorado Springs delaying the purchase of two replacement paratransit vehicles, according to a written summary for the October PPACG meeting by Craig Casper, the regional planning agency's transportation director. His summary also shows that just under $1 million in locally available federal funds will be redirected to Fillmore.
       What the reallocation effort means for the state is “borrowing from the pot,” as Les Gruen, the region's representative on the State Transportation Commission, put it. “It will have to be paid back later.”
       Details on a new funding plan for Cimarron will be provided by staff at either the November or December PPACG board meeting, PPACG Director Rob MacDonald predicted.
       The board would need to vote on the new Cimarron plan, which will be formally identified as a transportation improvement program (TIP) amendment, he said.
       The board did vote at its Oct. 8 meeting to approve a TIP amendment that staff had written authorizing the funding changes for Fillmore. The amendment includes “an exception to the PPACG Not One Penny Extra Policy.” The policy had been established by the PPACG board in 2006 “to address project cost overruns,” according to Casper's summary.
       The current situation contrasts with a year ago, when CDOT announced that funding was ready to go for both Fillmore and Cimarron. Fillmore was even expected at that time to get in the ground as early as February 2014, at a cost then announced as $11 million. (This increased several months later to $13 million because of a few design changes combined with inflation, Andrew has explained).
       The Cimarron $95 million cost estimate was also worked out last winter, and CDOT made a public announcement of its schedule in December 2013. The work will not only replace the interchange and ramps but make roadway alignment changes to the north and south.
       Both interchanges are chiefly being funded by CDOT's Responsible Acceleration of Maintenance and Partnerships (RAMP) program.
       Ironically, it was while waiting for the funding from RAMP - which is a new program - to work its way through the state bureaucracy this year that contractors' costs started showing steep increases.
       “We were hoping it would be quicker, but it wasn't,” Andrew said of the RAMP process.
       Rowe said that the clearest sign of the inflation trend was a recent project in the Denver area in which all three bidders came in about 20 percent over what CDOT had termed its “guaranteed maximum.” The contractors even told CDOT that if the maximum stayed unchanged in a rebid process, they would not find it in their economic interests to participate, Rowe related.
       On the Fillmore bidding, Andrew said that CDOT was initially surprised to receive only three bids, when in recent years six to eight bids have been typical for jobs of that size.
       The low bidder, SEMA Construction, was chosen by CDOT despite the higher-than-expected amount. “We have the ability to absorb the shortfall,” Andrew said. “Everyone is on board with the funding.”

Westside Pioneer article
(Posted 10/8/14; Transportation: Cimarron/I-25 and Fillmore/I25)

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