Time is money – $50 million – for high-speed rail delays in Fresno area

Construction delays connected to the California High-Speed Rail Authority’s slow pace of acquiring land to build its first Fresno-Madera segment have ended up costing the agency about $50 million.

A change order in June between the agency and its prime contractor, Tutor Perini / Zachry / Parsons, calls for compensation of $49.9 million to the contractor for delay-related effects on the construction schedule, according to a report presented to rail authority board members at their meeting Tuesday in Sacramento. Tutor Perini / Zachry / Parsons, a joint venture of companies from Southern California and Texas, was awarded a contract of just over $1 billion in mid-2013 for a 29-mile segment from the northeastern edge of Madera to the south end of Fresno.

But the contractor could not start major construction activities until last summer.

In the meantime, Tutor Perini had about $10 million worth of new cranes, bulldozers and other heavy equipment sitting idle for about a year in a construction yard in northwest Fresno as it waited for the authority to assemble a critical mass of property where meaningful work could begin. The delays prompted Tutor Perini CEO Ron Tutor to tell investors in a conference call last year that he wanted to negotiate compensation from the state for the delays.

In addition to compensating the companies for the delays through the end of 2015, the $49.9 million change order also extended the contract’s completion deadline by 17 months, pushing it from March 31, 2018, to August 2019. A separate change order is expected to require the authority to pony up another $13.6 million “to compensate for seven months of acceleration” for the construction schedule, according to the report to the rail board.

“There has been much attention given to right-of-way acquisition,” said Scott Jarvis, the rail authority’s chief engineer. “It’s been a challenge, but it’s a challenge we have actively managed.” The authority has focused its land-buying efforts on sites along the rail route where major structures will take the longest time to build, Jarvis added.

Of about 870 pieces of property needed for the Fresno-Madera construction segment, which was extended by almost three miles earlier this year, the authority reports that as of last week it has acquired 563 parcels.

That progress has the rail authority and its contractors poised to expand construction to multiple sites over the next few months. Significant construction is already taking place on two elevated viaducts, one over the Fresno River and Highway 145 near Madera and another at the south end of Fresno that will span Cedar and North avenues and Highway 99.

Construction is also underway on:

▪ A bridge over Cottonwood Creek near Avenue 13 southeast of Madera, where abutments and pier caps are being built.

▪ A new bridge over the San Joaquin River at the Madera-Fresno county line east of Highway 99, where land is being cleared and prepared for work and cages of iron reinforcement bar are being prepared for columns.

▪ A trench north of downtown Fresno that will take the high-speed train tracks under Highway 180 and a freight railroad line.

▪ A new Tuolumne Street bridge that will carry automobile traffic over the train tracks in downtown Fresno. The old one-way eastbound bridge was demolished earlier this year; the replacement will serve two-way traffic and is expected to be completed later this year.

“Those locations take the longest to complete, and that’s where most of the construction costs reside,” Jarvis said.

Upcoming construction sites include road overcrossings at either Avenue 7 or Avenue 8, at Avenue 12 and at Avenue 15 in Madera County; at American Avenue south of Fresno; a bridge over the Herndon Canal and the first phase of utility relocations and detours for reconfiguring Shaw Avenue near the Union Pacific Railroad tracks to accommodate the high-speed rail line.

The Tutor Perini / Zachry / Parsons contract is one of three that have been awarded for the 119-mile stretch of the rail route in the San Joaquin Valley from Madera to north of Bakersfield – a section described as a “backbone” for what is ultimately supposed to be a 520-mile line to connect San Francisco and Los Angeles by way of the San Joaquin Valley, with electric trains carrying passengers at up to 220 mph.

The second contract, for about $1.4 billion, was awarded in early 2015 to a team comprised of Dragados USA Inc., a wholly owned subsidiary of Spain’s Grupo ACS and Dragados S.A., for about 65 miles of line from American Avenue in south Fresno to the Tulare-Kern county line; and Flatiron West Inc. of San Marcos. California Rail Builders, a joint venture led by a subsidiary of Spanish construction firm Ferrovial S.A., won the third contract for $444.3 million earlier this year to build from the Tulare-Kern line to Shafter, in Kern County.

Across all three Valley segments, the rail authority estimates it will need about 1,590 parcels of property, of which it has secured 841 as of last week.

This story was originally published August 9, 2016 at 3:34 PM with the headline "Time is money – $50 million – for high-speed rail delays in Fresno area."