GAO

United States General Accounting Office

Report to Congressional Requesters

September 2000 MASS TRANSIT

Project Management

Oversight Benefits and

Future Funding

Requirements

GAO/RCED-00-221

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United States General Accounting Office

Washington, D.C. 20548

Resources, Community, and

Economic Development Division

B-284186 Letr

September 15, 2000

The Honorable Phil Gramm

Chairman

Committee on Banking, Housing, and Urban Affairs

United States Senate

The Honorable Richard C. Shelby

Chairman

Subcommittee on Transportation and Related Agencies

Committee on Appropriations

United States Senate

The Honorable Frank R. Wolf

Chairman

Subcommittee on Transportation and Related Agencies

Committee on Appropriations

House of Representatives

To meet the nation’s transportation needs, many states, cities, and localities

are building or planning mass transit projects to replace aging

infrastructure or add new capacity. These transit projects are very costly

and require large investments of public resources. Much of the funding is

made available through grants from the Department of Transportation’s

Federal Transit Administration (FTA). These projects can be technically

challenging and can take years to construct. In the early 1980s, several

federally funded transit projects experienced major problems with the

quality of construction, cost overruns, and missed milestones. To help

lessen the risk and safeguard the federal investment in transit projects, the

Congress authorized FTA’s project management oversight program in 1987.

Today, FTA and its project management oversight contractors monitor over

100 major capital projects—generally defined by FTA as including those

expected to cost more than $100 million—which are collectively expected

to cost about $47.5 billion.

Because of your continuing concern about the federal investment in

projects that have experienced cost increases and schedule delays and

your interest in maximizing the impact of FTA’s investments, you asked us

to review FTA’s oversight of major capital projects. As agreed with your

offices, this report describes (1) how FTA oversees major capital projects,
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(2) how financial capacity assessments are used, (3) what types of benefits

to grantees and FTA have resulted from FTA’s project oversight activities,

and (4) how these oversight activities are funded.

Results in Brief The project management oversight program is designed primarily to help

ensure that grantees constructing major capital projects have the qualified

staff and procedures to successfully build the projects according to

accepted engineering principles. To implement this program, FTA enters

into contracts with competitively selected engineering firms, which serve

as an extension of its limited technical staff. While a project is being

designed, the oversight contractor reviews the grantee’s plan for managing

and constructing the project. This plan is the key document that the

oversight contractor and FTA use to determine whether the grantee has the

technical capability to complete the project. Once FTA approves the plan,

the oversight contractor monitors the project to determine whether it is

progressing on time, within budget, and according to approved plans and

specifications.

As a result of FTA’s experiences with the Los Angeles subway project in the

mid-1990s, in 1998, FTA expanded its oversight efforts to include a formal

and rigorous assessment of a grantee’s financial capacity to build and

operate a new project and of the financial impact of that project on the

existing transit system. Such an assessment includes reviewing the

grantee’s current financial health as well as its ability to meet future capital

and operating costs. These assessments, performed by independent

accounting firms, are now completed before FTA commits funds for

construction and are updated as needed until projects are completed.

FTA’s project management oversight program has resulted in benefits for

both grantees and FTA. Transit agencies have commended the program and

cited numerous examples of how the FTA contractors have improved

project management, especially quality controls. For example, according to

the grantee constructing the San Jose light-rail system, FTA’s oversight

contractor provided guidance and recommendations in the grantee’s

development of a sound quality assurance program, which resulted in

fewer problems and less “rework” than occurred on previous construction

projects. The project management oversight contractors routinely provide

FTA with an early warning of issues and problems that can lead to schedule

delays and increased costs and have helped FTA identify actions to mitigate

the impact of these problems. For example, the oversight contractor on the

Tren Urbano project in Puerto Rico, after identifying cost increases and
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schedule delays, conducted a thorough analysis of the project’s cost and

recommended that the grantee take specific actions to help control the

cost. Furthermore, FTA’s increased use of financial capacity assessments

before federal funds are committed has helped protect the federal

investment in major capital projects. Finally, by identifying recurring

problems across projects, FTA’s project management oversight program

has helped the Congress and FTA recognize the need to revise and expand

the criteria used to review and fund proposed projects.

FTA’s oversight activities are supported by a statutorily limited set-aside of

the funds made available annually for certain transit programs. In the past,

this set-aside has been more than sufficient to cover the costs of FTA’s

oversight contractors. FTA officials now believe that this amount will not

be sufficient to allow them to continue their current level of oversight

activity, mainly because the number of projects in one of FTA’s capital

investment programs—“new starts”—has increased by almost 90 percent

since 1996 and will continue to grow. FTA believes that starting in fiscal

year 2002, it will have to cut back its level of oversight activities on some

projects. This cutback could occur at a time when many of the proposed

new transit projects are sponsored by transit agencies that have little or no

experience in planning, designing, and constructing major transit projects.

FTA officials could not tell us what level of shortfall would occur after

fiscal year 2002 or exactly how it would address any shortfalls.

For these reasons, we are recommending that the Secretary of

Transportation direct the Administrator of FTA to (1) determine the

amount of funds needed to oversee the growing number of transit projects

that will require oversight, the level of funding that likely will be available,

and any resultant shortfall in funds; (2) identify options to cover any

projected shortfalls; and (3) identify steps to respond to any shortfalls as

they occur. We are recommending that the Secretary of Transportation

provide the Congress with this information for consideration.
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Background FTA oversees major capital projects primarily through its project

management oversight (PMO) program. FTA initiated this program after

several of its “new starts” projects encountered quality, cost, and schedule

problems in the early to mid-1980s.1 According to FTA officials, these

problems were attributable to the process that transit grantees followed in

developing their projects. At that time, grantees focused their efforts on

designing projects and obtaining funding and focused less on developing a

practical plan for managing and constructing a project effectively once

funding was received.

To safeguard the federal investment, the Surface Transportation and

Uniform Relocation Assistance Act of 1987 authorized the PMO program

and established a funding mechanism for oversight of major capital

projects. As a condition of federal financial assistance, grantees are

required to develop and implement project management plans that address

quality, scheduling, budget, and other issues. This requirement is intended

to focus grantees on implementation issues early in a project’s life.2 Under

the act and FTA’s implementing regulations, project management oversight

typically begins during the preliminary engineering (early design) stage of a

project. The PMO program is financed with a statutorily limited set-aside of

funds made available annually for specified programs; with this funding,

FTA retains engineering firms to review, approve, and monitor the project

management plans. Currently, FTA’s PMO program is monitoring the

construction of over 100 major capital projects collectively estimated to

cost about $47.5 billion. Most of these projects are funded by grants

awarded under FTA’s capital investment programs—new starts, rail

modernization, and bus capitalization. (For a complete listing of these

projects, see app. I.)

1

“New starts” is one of three capital investment programs for which funding is provided

under section 5309 of title 49, U.S. Code. The “new starts” program funds up to 80 percent of

new transit systems that use separate and exclusive rights-of-way as well as extensions to

existing systems.

2

FTA is not charged with hands-on responsibilities—that is, with the inspection and

acceptance of construction work—for federally funded projects. These responsibilities rest

with the grantees. As builder and owner, each grantee is responsible for all aspects of a

project’s development and implementation. The grantees carry out their responsibilities

through a combination of their own staffs, engineering firms, and construction management

firms.
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The 1990 Department of Transportation Appropriations Act amended the

PMO funding provision to authorize FTA to use oversight funds to review

the safety, procurement, management, and financial management practices

of transit grantees. FTA’s safety, procurement, and management reviews

essentially focus on grantees’ compliance with the laws governing such

issues as safety, drug and alcohol testing, procurement procedures, and

civil rights protections. Financial management oversight generally entails

reviews of grantees’ financial management systems. In recent years, FTA

has expanded its oversight activities to include assessments of grantees’

financial capacity to carry out new starts projects. In fiscal year 1999, FTA

spent about $30.6 million on all of its oversight activities, including about

$22 million for project management and financial management oversight

activities.

FTA Oversees Major

Capital Projects

Through Its PMO

Program

FTA’s PMO program is process-oriented; it is designed to help ensure that

grantees constructing major transit projects have the technical capability

to carry out the projects’ design and construction according to accepted

engineering principles. Under this program, FTA enters into contracts with

competitively selected engineering firms to review the development and

implementation of grantees’ project management plans. These oversight

contractors also monitor projects to determine if they are progressing on

time, within budget, and according to approved plans and specifications.

FTA requires, at a minimum, monthly reports of the oversight contractors’

findings, together with recommendations for any corrective actions that

may be needed.

Selection, Assignment, and

Management of PMO

Contractors

By competitive procurement, FTA retains a number of qualified engineering

firms to serve as an extension of the agency’s limited technical staff and to

carry out oversight of major capital projects. These firms provide technical

expertise that, according to FTA, would be difficult, if not impossible, for

the agency to retain in-house. Typically, each PMO contract contains the

same statement of work and authorizes 5 years and 90,000 hours of work.3

FTA last awarded PMO contracts in 1998 and 1999. These contracts will

expire in 2003 and 2004 and are expected to cost a total of about $174.4

3

These contracts are level-of-effort contracts and provide flexibility by allowing adjustments

in the hours authorized because of changed conditions. Examples of changed conditions are

grantees’ delays in preparing project management plans and unexpected occurrences, such

as the default of a construction contractor.
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million. Appendix II lists the current PMO contractors. Staff in FTA’s 10

regional offices—called work order managers—are responsible for

ensuring that the contracts are prudently managed.

Generally, FTA assigns a PMO contractor to a specific transit project after

that project advances to the preliminary engineering stage of development.4

In assigning contractors, FTA makes a considerable effort to ensure that no

real or apparent conflict of interest exists between a contractor and a

grantee’s project. Prior to beginning work on a specific project, the

contractor participates in a kickoff meeting with the grantee, FTA’s Office

of Engineering, and the FTA regional office responsible for the project. This

meeting serves to explain the objectives and process of the PMO program

and to secure the commitment of the grantee to cooperate with the PMO

contractor and provide any necessary information. Typically, a PMO

contractor will stay assigned to the project as it progresses through the

final design and construction phase and the tests of its operation.

To maximize the effectiveness of its PMO contractors, FTA has developed

two approaches to monitoring transit projects—the “team” approach and

the “resident manager” approach. Under the team approach, used on the

majority of its contractor assignments, a group of specialists review the

assigned project on a periodic basis.5 The on-site resident manager

approach is used on large and complex projects for which full-time services

are justifiable from a cost-benefit point of view. The resident manager

approach is likely to be used in large metropolitan areas where a single

PMO contractor is responsible for monitoring several major capital

projects implemented by local transportation agencies. For example, in the

New York City metropolitan area, the on-site resident manager monitors 11

major capital projects currently being constructed by three different

grantees.

4

Projects typically progress from the initial planning and preliminary engineering phases to

the final design and construction phases.

5

FTA’s project oversight contractors must demonstrate, at a minimum, that they employ or

are able to retain professional persons licensed, registered, or certified as civil engineers,

structural engineers, electrical or traction power engineers, mechanical or vehicle

engineers, signals (railroad or transit) engineers, quality assurance engineers, and projectscheduling and value engineers.
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PMO Contractors’ Review

and Monitoring Activities

The focus of FTA’s PMO contractors is to monitor the grantees’ processes

for ensuring that projects are adequately staffed and properly managed in

accordance with accepted engineering principles and requirements. FTA’s

PMO contractors are charged with two fundamental responsibilities in

examining a grantee’s technical capability: (1) reviewing the grantee’s

project management plan and (2) monitoring the plan’s implementation.

The contractor reviews the plan—which must be prepared and updated

according to FTA’s requirements—to establish whether the grantee has, or

will have, a reasonable process in place for successfully completing a

major capital project. Once FTA approves the plan, the contractor then

monitors the grantee’s use of the plan and its effect on the project’s

implementation. Monitoring takes place throughout construction and

during the test phase of operations. FTA requires the PMO contractors to

report their findings at least monthly not only to keep the agency fully

informed of the grantees’ performance but also to convey to the grantees

the contractors’ observations, concerns, and recommendations for

corrective action, if any. In addition to assessing a grantee’s technical

capability, FTA also requires the PMO contractor to look at the

reasonableness of a project’s overall scope, cost, and schedule.

A grantee’s project management plan must include a quality assurance and

control program for the project’s design and construction. FTA believes

that to a large degree, the success of a major capital project depends on

having a sound quality assurance and control program that both the grantee

and the grantee’s design and construction contractors must follow. FTA

requires the PMO contractor to make sure that the program properly

addresses such quality issues as materials testing and that a suitable

staffing plan for the program exists. The agency also requires the PMO

contractor to verify that the grantee is adequately implementing the

program. PMO contractors also review other elements of projects, such as

safety.

FTA’s Oversight

Program Has Evolved

to Include Financial

Capacity Assessments

In recent years, FTA has recognized the need for changes in how it oversees

major capital investments in order to mitigate the financial risks associated

with these projects. FTA’s approach toward the financial monitoring of

grantees building major capital projects has evolved from performing onetime financial evaluations before committing federal funds to conducting

baseline assessments of grantees’ financial capacity to construct and

operate new projects followed by periodic monitoring as the projects

progress.
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FTA’s experiences with the Los Angeles subway project in large measure

precipitated changes in its financial monitoring of major capital projects. In

1997, management and financial difficulties with the Los Angeles subway

project caused FTA to require the grantee to prepare a recovery plan. FTA’s

review of that plan found that the grantee’s revenues projected in the plan

would be much lower than expected and insufficient to complete the

project and operate the rest of the transportation system. Subsequently, the

grantee had to suspend the construction of two planned extensions to the

subway for which FTA had already committed funds through a full funding

grant agreement.6 Since then, FTA has sought to develop a comprehensive,

structured program for assessing the financial capacity of grantees to build

and operate major capital projects to help ensure that a repeat of the Los

Angeles subway project situation does not occur.

In summer 1998, FTA began taking steps to elevate the importance of

financial capacity assessments as a tool for overseeing the construction of

major capital projects. FTA assigned five financial management oversight

consultants the responsibility of conducting financial capacity assessments

on the 13 projects that had full funding grant agreements at the time.7

Priority was given to the projects that had experienced cost increases and

schedule delays. In performing these assessments, the financial consultants

focused on the grantees’ capacity to complete their projects according to

the budget, schedule, and commitments in the full funding grant

agreements or as proposed in either a recovery or finance plan. Beginning

in 1999, as a matter of policy, FTA began performing these assessments on

all projects recommended for full funding grant agreements.

A financial capacity assessment includes a review of a grantee’s current

financial condition as well as the grantee’s ability to meet future capital and

operating costs. In assessing financial condition, the financial consultants

consider historical trends and current financial information contained in

the grantees’ audited financial statements and other relevant reports. In

assessing financial capacity, the consultants consider the nature of funds

pledged to support the grantees’ operating deficits and capital programs

6

A full funding grant agreement establishes the terms and conditions of federal financial

participation in the design and construction of certain major transit projects.

7

These consultants are independent public accounting firms that FTA was using to

implement its financial management oversight program. Combined, the current 5-year

contracts, which expire in 2003, provide for 125,000 hours of work at a cost of about $13.7

million.
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while considering the grantees’ capital, operating, and maintenance costs.

These assessments are also designed to identify issues that could affect the

projects in the future.

The specific scope and objective of each financial capacity assessment

varies depending on the size of the transit system being considered and the

scale of the proposed capital investment. FTA has developed guidance for

the financial consultants to use in conducting these assessments. At the

conclusion of the assessment, the consultant prepares a baseline report

indicating whether the grantee has the financial capacity to construct and

operate the project while maintaining its existing transit system. This

baseline report may identify such deficiencies as the grantee’s having no

means to meet unfunded operating deficits or unexpected construction

costs. A baseline report may also identify issues needing periodic

monitoring by FTA or corrective action by the grantee, such as the

establishment of a contingency fund.

As of August 2000, FTA had completed financial capacity assessments for

15 projects that have full funding grant agreements and that are still under

construction. In addition, assessments have been completed or scheduled

for another 12 projects recommended for grant agreements.

Transit Agencies and

FTA Have Benefited

From Project

Management Oversight

and Financial Capacity

Assessments

FTA’s PMO program and related financial capacity assessments have

benefited both the grantees and FTA. As a result of the PMO program,

grantees have improved their controls over project cost, schedule, quality,

and safety. At the same time, FTA has gained a better understanding of the

issues surrounding complex construction projects and an increased

awareness of potential problems that could lead to schedule delays or cost

increases. Even when problems on projects have been encountered, their

detection at an early stage by the PMO contractors has helped FTA and the

grantees to mitigate their impact. FTA points out that only 3 of the 15

projects with current grant agreements have had significant cost and

schedule concerns. In addition, FTA’s recent use of financial capacity

assessments has provided FTA with greater assurance that potential

grantees are ready to construct their projects and have the financial

capacity to complete them, thereby protecting the federal investment in

large transit projects.
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PMO Program Has Resulted

in a Wide Range of Benefits

for Grantees

The PMO program has resulted in a wide range of benefits for grantees

implementing major capital projects, including improved project controls

and cost savings. Grantees have commended the program and its impact on

project implementation. The grantees believe that their projects have

benefited from the expertise, experience, and independent perspective that

PMO contractors bring to their management teams. Furthermore, several

grantees told us that the PMO contractors’ reports and recommendations

can provide the mechanism for their project managers to obtain access to

upper management, enabling them to acquire the resources to implement

improved project controls.

The PMO contractors have recommended that the grantees take specific

actions to strengthen their project controls. In turn, the grantees have

responded to many of these recommendations by improving their project

controls in such areas as quality assurance and quality control (QA/QC) and

safety. Several examples of project control improvements follow:

• Developed Sound QA/QC Program. While reviewing the project

management plan for the San Jose, California, Tasman West light-rail

project, the PMO contractor provided the grantee with guidance and

recommendations for developing its QA/QC plan. For example, the PMO

contractor recommended that the grantee require its construction

contractors to hire on-site quality assurance managers. The grantee

believes that the assistance provided by the PMO contractor was critical

to its development of a sound QA/QC plan, which resulted in fewer

noncompliance reports and less rework than on previous construction

projects.

• Developed Comprehensive Project Management Plan. Concerned about

the lack of integration among three interrelated projects being

constructed by the San Francisco Municipal Railway, the PMO

contractor recommended that the grantee appoint an overall

coordinator and develop a comprehensive project management plan

that covered all projects. FTA and the PMO contractor believe that the

implementation of this recommendation has resulted in a more

coordinated effort and helped improve the implementation of these

projects. For example, the grantee’s development of a standardized

format for reporting financial, budget, and schedule information has

resulted in improved forecasting for these projects.

• Implemented Uniformity in QA/QC Program. The grantee, New York

City Transit—which operates the largest public transit system in the
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United States—is currently using federal funds to implement six

projects worth nearly $5 billion that are being monitored through the

PMO program. The grantee had an established QA/QC program;

nevertheless, in response to the PMO contractor’s recommendations,

the grantee took numerous actions designed to improve the uniform

implementation of the program. For example, at the urging of FTA and

the PMO contractor, the grantee hired a full-time quality director to

promote quality assurance throughout the agency’s many departments.

According to the PMO contractor, initiatives undertaken by the quality

director have helped establish quality assurance as an important part of

the agency’s culture and have resulted in specific performance

improvements, such as the reduction of average contract closeout time

from 2 years to 6 months.

• Expanded Safety Program. To improve construction safety, the PMO

contractor assigned to the Tren Urbano project in Puerto Rico

recommended that the grantee expand its safety department. In

response, the grantee hired additional staff, including a safety manager

qualified in the transit industry. The grantee also began conducting

surprise safety inspections at the various construction sites. The grantee

believes that these actions have resulted in a much safer project and

have helped reduce injuries and save lives. For example, in September

1999, the grantee shut down a construction site until safety violations

were corrected. Two months later, a worker escaped critical injury after

falling off an elevated structure because he was wearing a safety

harness. Prior to the shutdown, the grantee found that some workers

were not wearing safety harnesses.

• Enhanced Document Control System. To help avoid costly rework of

construction built to outdated specifications, the PMO contractor

assigned to the Tren Urbano project recommended that the grantee

improve its document control system. In monitoring the project, the

PMO contractor found that the grantee’s system was ineffective in

ensuring that the most current design drawings were distributed to the

construction managers in the field. In one case, a single drawing number

had been assigned to three different documents. To decrease its

vulnerability to the cost increases that could result from such a mistake,

the grantee purchased and implemented a new document control

system. This new system will allow the grantee to better track

documents and help protect against claims and future litigation. The

PMO contractor’s spot checks have confirmed that this system is

working.
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While the benefits of the PMO program are many and varied, they are not

often quantifiable in terms of dollars saved. However, the following

instances of actual or potential savings have resulted from the program.

Where these savings have occurred, they were usually the result of PMO

contractors’ recommending the use of construction management

techniques that were successfully used on other projects.

• On the South Boston Piers transitway project, the PMO contractor

recommended that the grantee use “wrap-up” insurance rather than the

traditional method of insuring the project under which all parties

involved in the project would obtain insurance independently.8 By

selecting wrap-up insurance, the grantee was able to achieve an initial

savings of $14.1 million and potential total savings of $21.1 million.

• On the Bay Area Rapid Transit Authority (BART) airport extension

project in San Francisco, the grantee avoided spending additional funds

by following the PMO contractor’s recommendation to obtain written

approval from the local fire marshal before beginning construction. At

the time, the grantee believed that it had reached an agreement with the

local fire marshal on the remedies needed to comply with fire code

standards and was ready to begin making the necessary design and

construction changes. On the basis of its prior experience with the fire

marshal on a similar project, the PMO contractor recommended that the

grantee not rely on a verbal agreement. That proved to be prudent

advice because the fire marshal was reluctant to approve the remedies

without further analysis. As a result, the grantee developed additional

analysis to demonstrate the adequacy of the remedies without

undertaking potentially unnecessary and costly construction work.

• On the San Jose Tasman West light-rail project, the PMO contractor

recommended that the grantee combine several of its construction

contracts. Originally, the grantee had planned for four construction

contracts with a separate contract for systems and track work. The PMO

contractor had seen the financial benefits of combining contracts on

similar projects throughout the country and advised the grantee

accordingly. In response, the grantee reduced the number of contracts

8

Under wrap-up insurance programs, project owners (such as state departments of

transportation and transit agencies) purchase insurance to cover all the parties involved in a

project—the owner, the construction manager, the general contractor, and the

subcontractors.
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by two and included the track work as part of these contracts.

According to the grantee, this action reduced the cost of the contracts

by $3 million, or 5 percent, by providing economies of scale and

reducing administrative costs and claims that might have occurred from

a separate contract for the track work.

To increase the cost-effectiveness of transit capital investments through a

sharing of PMO experiences and lessons learned on major projects, FTA

has compiled a file of 36 “lessons learned” and expects to accumulate more

in the future. The program was developed with the assistance of the PMO

contractors, grantees, and FTA’s regional engineers. The lessons provide

information that ranges from methods used to solve complex construction

problems to means of improving grantees’ design and construction

management practices. For example, one such lesson describes a

waterproofing method used successfully in tunneling through rock or soft

ground in Europe and the United States. At the recommendation of the

PMO contractor assigned to the South Boston Piers transitway project, this

method is being used to minimize the potential for water infiltration into

the transitway tunnel. As a result of this reduced likelihood of water

infiltration, the grantee expects reduced operating and maintenance costs

on this project. Another lesson discusses the use of an automated system

that has wide application for effectively controlling the complex and timeconsuming process of managing design and construction changes made in

the field. Developed by the Los Angeles County Metropolitan

Transportation Authority, the system is described as one that can be readily

adapted to meet the requirements of individual transit agencies.
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PMO Program Identifies and

Helps Address Cost and

Schedule Problems

The PMO program has also been instrumental in providing FTA with a

better understanding of the issues surrounding complex construction

projects and an increased awareness of potential problems that could lead

to schedule delays or cost increases. PMO contractors routinely alert FTA

to issues and problems that can lead to schedule delays and increased costs

and help FTA identify actions to mitigate the impact of these problems. The

PMO contractors assigned to three complex projects—South Boston Piers,

Tren Urbano, and BART airport extension—identified significant cost

increases and schedule delays early in construction and continue to

monitor these issues. In doing so, the PMO contractors have helped FTA

and the grantees develop strategies to address cost and schedule problems

and avoid situations in which a project must be suspended, as occurred

with the Los Angeles subway project. Furthermore, FTA’s use of financial

capacity assessments on these projects has helped lessen FTA’s concern

that the grantees will not be able to complete these projects without

affecting their existing transit systems.9

Oversight efforts on the South Boston Piers transitway project, which has

some joint construction with the Central Artery/Tunnel project in Boston,

illustrate the role PMO contractors have played in identifying and helping

resolve budget and schedule problems on major transit projects. The PMO

contractor assigned to the transitway project first alerted FTA about the

potential for schedule delays in 1996, when the transitway was still in the

early stages of final design and construction. In early 1997, the PMO

contractor reported to FTA that because of a number of factors, such as

utility design coordination problems and differing site conditions on the

joint construction contracts with the Central Artery project, the transitway

project could open 2 years behind schedule and cost as much as $542

million—-$129 million more than the original estimate approved in the 1994

grant agreement. As the PMO contractor continued to monitor and bring

these cost and schedule issues to FTA’s attention, FTA took actions to help

protect the federal investment and control the project’s cost and schedule.

For example, in 1997, FTA required the grantee to submit a recovery plan

addressing the cost and schedule issues. When the grantee was slow in

9

Concern about cost growth in the Tren Urbano, BART, and South Boston Piers projects led

to language in the Conference Report accompanying the fiscal year 2000 Department of

Transportation Appropriations Act making funds contingent on the completion of finance

plans setting forth the full cost to complete each project and how each grantee expects to

pay those costs, among other things. The conferees also directed FTA to conduct ongoing,

continual financial management reviews of the three projects.
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submitting a plan that satisfactorily addressed these issues, FTA withheld

the project’s fiscal year 1998 funding. At the same time, FTA, through the

PMO contractor, made numerous recommendations designed to help

improve the grantee’s cost and schedule controls. The grantee responded

to these recommendations by hiring a scheduler and using a master critical

path schedule to coordinate the project’s design, land acquisition, and

construction activities.

Also, in spring 1999, FTA assigned a financial management oversight

consultant to assess the grantee’s financial capacity to complete and

operate the project as well as the existing system. During the review, the

grantee updated its capital finance plan and, in June 1999, revised the

transitway’s cost estimate to $601 million and projected a new opening date

of December 2003. At the urging of FTA, the grantee agreed to provide a $50

million reserve fund over the project’s $601 million budget to cover any

additional cost growth that might occur. In September 1999, the financial

consultant issued a baseline financial capacity report, which concluded

that, at the time, the grantee possessed the financial capacity to complete

the full scope of the project. However, the report also identified areas for

which financial exposure remained and recommended that a number of

issues be monitored on a continuing basis, such as pending legislation that

would change the method by which the grantee’s capital and operating

losses are funded. Both the financial consultant and the PMO contractor

have continued to monitor these issues. After the legislation was enacted,

the grantee issued a report on the impact this funding change would have

and an updated finance plan. FTA’s financial consultant is currently

assessing these documents.
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As we reported in August 1999, the Tren Urbano project in San Juan and the

BART airport extension in San Francisco have also experienced significant

cost increases and schedule delays.10 In monitoring these projects, FTA and

its PMO contractors have been aggressive in identifying, analyzing, and

seeking to mitigate the impact of cost increases and schedule delays. For

example, on the Tren Urbano project, after identifying cost increases and

schedule delays, the PMO contractor analyzed the project’s cost at FTA’s

direction. As part of this analysis, the PMO contractor projected a $370

million increase in cost, which was consistent with the grantee’s latest

revised cost estimate. FTA directed the grantee to update its finance plan to

reflect the project’s cost increase and assigned a financial consultant to

assess the grantee’s financial capacity to complete the project.11 In

addition, the PMO contractor recommended that the grantee take specific

actions to help control the project’s cost. The grantee implemented many of

these recommendations. For example, the grantee is now using an

integrated master schedule for the project to monitor the progress of seven

individual construction contracts. These contracts, if not completed on

schedule, could subsequently impact the cost of completing the final phase

of the project.

On the BART airport extension project, the PMO contractor has scrutinized

and actively monitored cost and schedule issues. Throughout the life of the

project, the PMO contractor has raised concerns about the adequacy of the

project’s cost estimate and recommended that the grantee take specific

actions that would improve the cost estimate and help contain the project’s

cost. For example, the PMO contractor found that the grantee’s cost

estimate did not account for 2 additional years of anticipated inflation and

was understated by $40 million. As the project’s cost continued to escalate,

FTA directed the grantee to update its finance plan accordingly and

assigned a financial consultant to assess the grantee’s financial capacity to

complete the project.12 In conjunction with this review, the PMO contractor

recommended and the grantee agreed to provide an additional $27 million

in contingency funds to cover potential cost increases if needed.

10Mass Transit: Status of New Starts Transit Projects With Full Funding Grant Agreements

(GAO/RCED-99-240, Aug. 19, 1999).

11For more information on our review of the grantee’s finance plan, see Mass Transit: Review

of the Tren Urbano Finance Plan (GAO/RCED-00-94R, Mar. 31, 2000).

12For more information on our review of the grantee’s finance plan, see Mass Transit: Review

of the Bay Area Rapid Transit District’s Airport Extension Finance Plan (GAO/RCED-00-95,

Mar. 31, 2000).
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PMO Program Has Helped

Improve FTA’s Process for

Awarding Full Funding

Grant Agreements

By identifying recurring problems contributing to cost increases and

schedule delays across projects, the PMO program has helped the Congress

and FTA recognize the need to revise and expand the criteria for

determining when a project is ready to receive a full funding grant

agreement. Furthermore, FTA increasingly relies on its PMO and financial

contractors to determine if potential grantees are ready to receive grant

agreements. These efforts should help grantees avoid major cost, schedule,

or quality problems and help protect the federal government’s investment

in major capital projects.

In making grant agreement decisions, FTA began, in 1999, to assess the

readiness of only the projects that it had rated as either recommended or

highly recommended through its annual new starts evaluation process.13 At

the core of FTA’s readiness criteria is FTA’s commitment to enter into a

grant agreement only after (1) a project has completed a sufficient degree

of final design for the full scope and cost of the project to be reliably

estimated and (2) the grantee has clearly demonstrated that it has the

financial capacity to complete and operate the project.

In assessing project readiness, FTA uses its PMO contractors to closely

scrutinize projects’ capital cost estimates, including the availability of

adequate contingency funds to cover potential cost increases. FTA’s efforts

to review cost estimates before signing a grant agreement for the TriCounty Commuter Rail project in South Florida demonstrates this

approach. Over a 6-month period, weekly conferences were held with the

grantee, FTA, and the PMO contractor to discuss and review the proposed

full funding grant agreement. According to the grantee, the PMO contractor

conducted a thorough review of the cost estimates and held major

discussions about the adequacy of contingency amounts before concluding

that the grantee’s budget would be adequate to complete the project.

13For more information on FTA’s new starts evaluation process, see Mass Transit:

Implementation of FTA’s New Starts Evaluation Process and FY 2001 Funding Proposals

(GAO/RCED-00-149, Apr. 28, 2000).
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As a result of language in the Conference Report accompanying the

Department of Transportation Appropriations Act for fiscal year 2000, FTA

is sending financial capacity assessments, along with other documentation,

to the House and Senate Appropriations Committees 60 days before signing

full funding grant agreements.14 Since the beginning of fiscal year 2000, FTA

has signed grant agreements for four projects, all of which have received

financial capacity assessments. According to FTA, another 12 projects are

ready or will soon be ready for grant agreements in the next few months.

Funds Available for the

PMO Program May Not

Be Adequate to Cover

Growing Number of

Projects

FTA’s oversight activities are financed with a statutorily limited set-aside of

the funds made available for certain transit programs. In the past, this setaside has been more than sufficient to cover the costs of FTA’s oversight

contractors. FTA officials now believe that this amount will soon be

insufficient to allow them to continue their current level of oversight

activities on major transit projects, mainly because (1) the number of

projects in one of its capital investment programs—new starts—has

increased by almost 90 percent since 1996 and will continue to grow and

(2) because many of the new projects entering the preliminary engineering

phase will be managed by transit agencies that have little experience

designing and constructing large transit projects such as a new subway

system. Because of this anticipated shortfall, FTA believes that, in fiscal

year 2002, it will have to make some hard decisions about where to cut

back the level of oversight activities for individual projects.

14FTA also provides these assessments to its authorizing committees.
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Funds Available for FTA’s

Oversight Program Are

Limited by Law

FTA is authorized to use up to one half of 1 percent of the funds made

available annually for the Urbanized Area Formula Program and the

Nonurbanized Area Formula Program and three quarters of 1 percent of the

funds made available each year for the Capital Investment Program for its

oversight activities.15 Generally, as the federal funds made available for

these programs have increased, so have the amounts set aside for FTA’s

oversight activities. Table 1 shows the amounts made available (set aside)

for oversight activities from these programs over the past 5 fiscal years. In

fiscal year 1998, the set-aside was capped at $15 million by the 1998

Department of Transportation Appropriations Act.16

Table 1: Funds Set Aside for FTA’s Oversight Program by Source, Fiscal Years 1996

Through 2000

Source: FTA.

FTA allocates the funds for oversight among five major categories of

oversight activities: project management, financial management, safety,

procurement, and management oversight. Table 2 shows how FTA has used

the funds available for oversight, including the set-asides and unused

15The statutory provision concerning the financing of FTA’s oversight activities also

authorizes set-asides from funds made available for projects under the National Capital

Transportation Act of 1969, as well as for transit projects constructed as substitutes for

construction on the interstate system. By 1996, funds related to substitute projects were no

longer available for oversight. In fiscal years 1996 through 1999, FTA did not use National

Capital Transportation Act funds for oversight. According to FTA, the program was fully

funded in 1999.

16The cap was imposed in response to a 1997 report issued by the Department of

Transportation’s Office of Inspector General that had determined that the funds set aside for

the oversight program had been used for ineligible activities and significantly underutilized

by FTA in fiscal years 1994 through 1996.

Dollars in millions

Source

Fiscal year

1996

Fiscal year

1997

Fiscal year

1998

Fiscal year

1999

Fiscal year

2000

Formula

programs

$10.0 $10.5 $7.9 $13.7 $14.9

Capital

investment

programs

12.5 14.2 6.5 17.3 18.8

Total $22.5 $24.7 $14.4 $31.0 $33.7
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portions of the set-asides from prior years since fiscal year 1996. As the

table shows, the cost of providing PMO services has consumed the largest

portion of available oversight funds (almost 65 percent of available funds in

fiscal year 1999).

Table 2: FTA’s Oversight Expenditures by Major Oversight Activity, Fiscal Years

1996-2000

a

Actual expenditures through June 2000.

b

Includes expenditures for financial capacity reviews.

c

FTA’s safety, procurement, and management oversight reviews focus principally on

grantees’ compliance with federal laws governing such issues as rail safety, drug and alcohol

testing, procurement procedures, and civil rights protections.

Source: FTA’s data.

The annual growth in expenditures for PMO activity reflects the growth in

the number of major capital projects requiring oversight coverage. During

fiscal years 1996 through 2000, the total number of major capital projects

that FTA must monitor has grown by almost 35 percent—from 81 projects

in fiscal year 1996 to 108 in June 2000. Of this, the number of new starts

projects requiring oversight has increased by almost 90 percent—from 36

projects in fiscal year 1996 to 68 in June 2000. Table 3 summarizes the

growth of FTA’s PMO caseload since fiscal year 1996.

Dollars in millions

Oversight

activity

Fiscal year

1996

Fiscal year

1997

Fiscal year

1998

Fiscal year

1999

Fiscal year

2000a

Project

management

$12.3 $14.2 $16.4 $19.3 $16.1

Financial

managementb

2.0 1.8 1.7 2.7 2.4

Safetyc 0.9 1.4 2.7 0.0 0.5

Procurementc 0.4 1.1 1.7 1.6 0.6

Managementc 5.5 7.2 9.1 7.0 3.8

Total $21.1 $25.7 $31.6 $30.6 $23.4
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Page 21 GAO/RCED-00-221 Mass Transit

Table 3: Summary of FTA’s PMO Caseload by Type of Project, Fiscal Years 1996-2000

a

Actual as of June 2000.

Source: FTA’s data.

Amounts Available for

Project Management

Oversight Could Be

Insufficient to Monitor

Growing Number of

Projects

FTA believes that as the number of projects requiring oversight continues

to grow, the funds available for the PMO program will soon be insufficient

to adequately monitor all major capital projects. FTA anticipates that a

funding shortfall of about $5 million will occur in fiscal year 2002. However,

FTA was unable to tell us what level of funding shortfall would occur after

fiscal year 2002 because of uncertainties about its budget and the number

of projects that may require oversight.

According to FTA, the growing demand for PMO services is due in large

part to the large number of new starts projects identified as eligible for

funding by the 1998 Transportation Equity Act for the 21st Century (TEA21) and to a lesser degree by the need to increase the oversight of ongoing

projects with known problems, such as Tren Urbano and the South Boston

Piers transitway. For example, of the nearly 150 new projects identified by

TEA-21, 25 are expected to enter the preliminary engineering (early design)

stage of development within the next year. Of the remaining 125 projects,

as many as 25 could enter preliminary engineering in each succeeding year.

Each of these projects will require an oversight contractor to assess, for the

first time, the grantee’s project management plan and monitor the project’s

progress as it proceeds through preliminary engineering toward final

design. Furthermore, FTA notes that many of these projects will be

managed by transit authorities with little or no experience managing rail or

other large transit projects. Additionally, in fiscal year 2001, FTA expects to

execute full funding grant agreements for about 15 projects that will begin

construction. For these projects, FTA will have to authorize additional

hours for the oversight contractors already assigned to (1) reassess the

Number of projects

Type of

project

Fiscal year

1996

Fiscal year

1997

Fiscal year

1998

Fiscal year

1999

Fiscal year

2000a

New starts 36 39 41 59 68

Rail

modernization

34 35 37 39 35

Other 11 12 11 3 5

Total 81 86 89 101 108
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Page 22 GAO/RCED-00-221 Mass Transit

projects’ estimated costs and schedules; (2) assess their readiness for full

funding grant agreements; and (3) once the grant agreements have been

executed, monitor the grantees’ implementation of the construction phase,

which may take up to 4 years to complete.

FTA believes that its only recourse will be to scale back the level of

oversight currently being provided by doing a risk-based ranking of

projects. This will not be an easy task, according to FTA, because the

transit agencies with little or no experience in constructing rail systems

will likely require increased, rather than reduced, oversight. However, FTA

has not identified the amount of any shortfall after fiscal year 2002, options

to fund the shortfall, or steps to compensate for shortfalls in oversight

funds.

Conclusions FTA’s oversight of major capital projects has evolved over the past several

years to include more comprehensive and ongoing reviews of a proposed

grantee’s financial capacity to construct a major transit project.

Furthermore, FTA now routinely relies on its PMO contractors and

financial consultants to determine when future recipients are ready to

receive federal funds to build new transit systems or add major extensions

to their existing transit programs. These changes in FTA’s oversight and

grant-making activities have come about because of project cost and

schedule problems identified through the PMO program and the increased

congressional scrutiny resulting from those problems. In addition, these

changes should help grantees avoid major cost, schedule, or quality

problems and help protect the federal government’s investment in major

capital projects. However, with the likelihood of an increasing number of

transit projects requiring project oversight, FTA believes that the funds

available to pay for these oversight activities may soon be insufficient to

adequately monitor all large-dollar projects. FTA would then have to make

some hard choices about how it will apply limited oversight funds. FTA has

not yet identified the level of funding shortfalls that may occur beyond

fiscal year 2002 and how it would address any shortfalls.

Recommendation To address FTA’s oversight needs, the Secretary of Transportation should

direct the Administrator, FTA, to develop a plan to (1) determine the

amount of funds needed to maintain an adequate level of oversight for all

projects requiring oversight, the level of funding that likely will be available

for this purpose, and any resultant shortfall in funds; (2) identify options to
B-284186

Page 23 GAO/RCED-00-221 Mass Transit

cover any projected funding shortfalls; and (3) identify steps to respond to

any shortfalls that may occur. The Secretary should also communicate this

plan to the Congress.

Agency Comments We provided the Department of Transportation with a draft of this report

for review and comment. We met with Federal Transit Administration

officials, including the Associate Administrator, Office of Program

Management, and officials from the Office of Budget and Policy.

FTA agreed with the report’s contents and provided us with minor technical

comments, which we have incorporated where appropriate.

Scope and

Methodology

To identify how FTA is overseeing major capital projects, we reviewed

applicable legislation, regulations, program guidance, and other

documentation on FTA’s oversight process and procedures. We also

interviewed FTA officials in the Offices of Oversight and Engineering and

solicited the views of FTA’s regional and transit authority officials

responsible for major transit projects.

To identify the types of benefits that have resulted from FTA’s PMO

program, we reviewed the reports of the PMO contractors and FTA’s

financial consultants and visited 4 of FTA’s 10 regional offices. We selected

these regional offices—located in New York, San Francisco, Boston, and

Atlanta—on the basis of (1) the concentration of grantees and projects

receiving PMO oversight, (2) the projected cost of these projects, and (3)

the location of three major projects—the South Boston Piers transitway,

BART’s airport extension, and Puerto Rico’s Tren Urbano—that have

experienced significant cost increases and schedule delays. When we

began our review in September 1999, FTA was using 15 PMO contractors to

oversee 49 grantees responsible for implementing 101 major capital

projects estimated to cost $49 billion to complete. At that time, 57 of the

101 projects covered by the PMO program resided in the four regions we

visited. During our site visits, we interviewed FTA officials responsible for

the PMO program and seven PMO contractors. We discussed the benefits

identified in the PMO reports with both the PMO contractors and

appropriate FTA staff. These seven PMO contractors were responsible for

overseeing 28 of the 49 grantees receiving oversight. Furthermore, these 28

grantees were implementing 54 of the 101 projects receiving oversight,

which together accounted for 63 percent of the total estimated dollar

value—$49 billion—of all projects.
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Page 24 GAO/RCED-00-221 Mass Transit

We also met and discussed PMO program benefits with nine grantees

implementing major capital projects. These grantees were selected to

represent (1) a variety of project types, including rail, bus, and vehicle

acquisition projects, as well as different methods of construction, such as

design/build (where a single contractor is responsible for designing and

building all or major parts of the project); (2) transit agencies with varying

degrees of experience in carrying out major capital projects; and (3) the

three projects that have experienced significant cost increases and

schedule delays. These nine grantees are responsible for implementing 28

projects, or 29 percent of all projects receiving project management

oversight. We also met with the financial consultants responsible for

reviewing the finance plans for the three projects that have had major cost

and schedule problems.

To determine project management oversight costs and funding needs, we

reviewed FTA’s oversight budgets and related cost data. We also met with

FTA headquarters officials, including officials responsible for program

management oversight and transit budget issues.

We performed our review from September 1999 through August 2000 in

accordance with generally accepted government auditing standards.

As arranged with your offices, unless you publicly announce its contents

earlier, we plan no further distribution of this report until 30 days after the

date of this letter. At that time, we will provide copies of this report to the

Honorable Rodney E. Slater, Secretary of Transportation; the Honorable

Nuria I. Fernandez, Acting Administrator, Federal Transit Administration;

the Honorable Jacob J. Lew, Director, Office of Management and Budget;

and other interested parties. We will also make copies available to others

on request.
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Page 25 GAO/RCED-00-221 Mass Transit

Please call me at (202) 512-2834 if you or your staff have any questions

about this report. Key contributors to this report were Jack Bagnulo, Kirk

Kiester, Dave Lehrer, Carol Ruchala, and Ron Stouffer.

Phyllis F. Scheinberg

Associate Director,

Transportation Issues
Page 26 GAO/RCED-00-221 Mass Transit

Appendix I

Major Capital Projects Covered by the Project Apendxies

Management Oversight Program as of June 30,

2000 ApendxiI

Grantee Name Type Location Phase

Total

cost

PMO

contractor

Region 1 (Boston)

Bridgeport Bridgeport Intermodal

Center

New start Bridgeport,

Conn.

Final design/

construction

$55,000,000 Delon Hampton

Connecticut DOT New Britain-Hartford

Busway

New start Hartford, Conn. Preliminary

engineering

80,000,000 Carter &

Burgess, Inc.

Connecticut DOT Stamford Urban

Transitway

New start Stamford, Conn. Preliminary

engineering

23,000,000 Carter &

Burgess, Inc.

Massachusetts Bay

Transportation

Authority

South Boston Piers

Transitway

New start Boston, Mass. Construction 601,000,000 Transportation

Construction

Services, Inc.

New Hampshire DOT Lowell to Nashua

Extension

New start Nashua, N.H. Preliminary

engineering

41,000,000 Carter &

Burgess, Inc.

Northern New

England Passenger

Rail Authority

Portland Rail

Restoration

Rail mod Portland, Maine Construction 60,000,000 Transportation

Construction

Services, Inc.

Region 1 total $860,000,000

Region 2 (New York)

Connecticut DOT New Haven

Interlocking

Rail mod New Haven,

Conn.

Final design/

construction

126,000,000 Delon Hampton

Connecticut DOT New Haven Terminal

and Yard

Rail mod New Haven,

Conn.

Final design/

construction

139,000,000 Delon Hampton

Connecticut DOT New Haven Mainline

Catenary

Replacement

Rail mod Stamford, Conn. Construction 300,000,000 Delon Hampton

Connecticut DOT Stamford Center

Island Platform

Rail mod Stamford, Conn. Construction 113,000,000 Delon Hampton

Long Island Rail

Road

2000 Track Work

Program

Rail mod New York, N.Y. Construction 64,000,000 Fluor Daniel

Long Island Rail

Road

Atlantic Terminal

Improvements

Rail mod New York, N.Y. Final design 23,000,000 Fluor Daniel

Long Island Rail

Road

Babylon Station

Improvements

Rail mod New York, N.Y. Construction 7,000,000 Fluor Daniel

Long Island Rail

Road

Communications

Upgrade

Rail mod New York, N.Y. Construction 44,000,000 Fluor Daniel

Long Island Rail

Road

Diesel Yard

Improvement

Rail mod New York, N.Y. Construction 65,000,000 Fluor Daniel

Long Island Rail

Road

East Side Access New start New York, N.Y. Preliminary

engineering

4,300,000,000 Fluor Daniel

Long Island Rail

Road

Power Upgrade

Program

Rail mod New York, N.Y. Construction 43,000,000 Fluor Daniel
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 27 GAO/RCED-00-221 Mass Transit

Long Island Rail

Road

Rehabilitation of

Bridges

Rail mod New York, N.Y. Construction 8,000,000 Fluor Daniel

Long Island Rail

Road

Signal Upgrade

Program

Rail mod New York, N.Y. Construction 23,000,000 Fluor Daniel

Metro-North Railroad Grand Central Station

Improvements

Rail mod New York, N.Y. Construction 284,000,000 Delon Hampton

Metro-North Railroad Park Avenue Viaduct Rail mod New York, N.Y. Construction 143,000,000 Delon Hampton

New Jersey Transit

Corporation

Hoboken

Improvement Program

Rail mod Newark, N.J. Final design/

construction

300,000,000 Delon Hampton

New Jersey Transit

Corporation

Hudson-Bergen Light

Rail Transit (Phase 1)

New start Hudson-Bergen,

N.J.

Construction 1,203,000,000 Delon Hampton

New Jersey Transit

Corporation

Hudson-Bergen Light

Rail Transit (Phase 2)

New start Hudson-Bergen,

N.J.

Final design 1,215,400,000 Delon Hampton

New Jersey Transit

Corporation

Montclair Connection Rail mod Newark, N.J. Final design/

construction

45,000,000 Delon Hampton

New Jersey Transit

Corporation

Secaucus Transfer

Station

New start Newark, N.J. Construction 553,000,000 Delon Hampton

New Jersey Transit

Corporation

Newark City Subway Rail mod Newark, N.J. Construction 107,000,000 Delon Hampton

New Jersey Transit

Corporation

Newark Rail Link

(Phase 1)

New start Newark, N.J. Final design 211,000,000 Delon Hampton

New Jersey Transit

Corporation

Newark Penn Station Rail mod Newark, N.J. Construction 31,000,000 Delon Hampton

New Jersey Transit

Corporation

New York,

Susquehanna &

Western Railroad

Rail mod Newark, N.J. Final design 118,000,000 Delon Hampton

New Jersey Transit

Corporation

Penn Station

Expansion

Rail mod New York, N.Y. Construction 133,000,000 Delon Hampton

New York City DOT Saint George Ferry

Terminal

Other New York, N.Y. Final design 91,000,000 Fluor Daniel

New York City DOT Whitehall Ferry

Terminal

Other New York, N.Y. Construction 110,000,000 Fluor Daniel

New York City Transit New Vehicles New start New York, N.Y. Acquisition 1,447,000,000 Fluor Daniel

New York City Transit Queens Boulevard

Line Connection

New start New York, N.Y. Construction 645,000,000 Fluor Daniel

New York City Transit Signals Modernization Rail mod New York, N.Y. Construction 1,311,000,000 Fluor Daniel

New York City Transit Station Rehabilitation Rail mod New York, N.Y. Construction 1,800,000,000 Fluor Daniel

New York City Transit Ventilation Plant

Improvements

Rail mod New York, N.Y. Construction 561,000,000 Fluor Daniel

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 28 GAO/RCED-00-221 Mass Transit

Region 2 total $15,563,400,000

Region 3 (Philadelphia)

Mass Transit

Administration,

Maryland DOT

Light Rail Transit

Double Tracking

New start Baltimore, Md. Preliminary

engineering

153,000,000 Carter &

Burgess, Inc.

Mass Transit

Administration,

Maryland DOT

MARC Frederick

Extension

New start Frederick, Md. Construction 60,000,000 Carter &

Burgess, Inc.

Mass Transit

Administration,

Maryland DOT

MARC Vehicle

Procurement

New start Baltimore, Md. Acquisition 132,000,000 Carter &

Burgess, Inc.

Port Authority of

Allegheny County

Airport Busway New start Pittsburgh, Pa. Construction 326,800,000 Stone & Webster

Port Authority of

Allegheny County

East Busway

Extension

Other Pittsburgh, Pa. Final design/

construction

62,800,000 Stone & Webster

Port Authority of

Allegheny County

Stage II Light Rail

Reconstruction

Rail mod Pittsburgh, Pa. Final design/

construction

386,500,000 Stone & Webster

Southeastern

Pennsylvania

Transportation

Authority

Blue Line Rail mod Philadelphia,

Pa.

Final design/

construction

1,058,000,000 Carter &

Burgess, Inc.

Hampton Roads

Transit

Norfolk-Virginia Beach

Light Rail Transit

New start Norfolk, Va. Preliminary

engineering

524,000,000 Frederic R. Harris

Region 3 total $2,703,100,000

Region 4 (Atlanta)

Hillsborough Area

Regional Transit

Authority

Electric Streetcar New start Tampa, Fla. Final design 27,000,000 Transportation

Construction

Services, Inc.

Hillsborough Area

Regional Transit

Authority

Regional Rail New start Tampa, Fla. Preliminary

engineering

575,000,000 Transportation

Construction

Services, Inc.

Jacksonville Transit

Authority

People Mover

Extension

New start Jacksonville,

Fla.

Construction 160,000,000 Transportation

Construction

Services, Inc.

Metropolitan Atlanta

Rapid Transit

Authority

Metro Rail Extension -

North Springs

New start Atlanta, Ga. Construction 526,000,000 Urban

Engineers,

Inc.

Memphis Area

Transit Authority

Medical Center Rail

Extension

New start Memphis, Tenn. Final design 74,600,000 Transportation

Construction

Services, Inc.

Miami-Dade Transit

Agency

Earlington Heights to

Miami Intermodal

Center

New start Miami, Fla. Preliminary

engineering

231,000,000 Sverdrup Civil, Inc.

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 29 GAO/RCED-00-221 Mass Transit

Miami-Dade Transit

Agency

North 27th Avenue

Corridor Bus Rapid

Transit

New start Miami, Fla. Preliminary

engineering

80,000,000 Sverdrup Civil, Inc.

Miami-Dade Transit

Agency

Palmetto Extension New start Miami, Fla. Construction 87,000,000 Sverdrup Civil, Inc.

Miami-Dade Transit

Agency

South Busway

Extension, Phase II

New start Miami, Fla. Preliminary

engineering

87,758,000 Sverdrup Civil, Inc.

Metropolitan Transit

Commission

Charlotte-Pineville

Light Rail Transit

New start Charlotte, N.C. Preliminary

engineering

331,000,000 Sverdrup Civil, Inc.

Puerto Rico DOT Tren Urbano Rapid

Rail

New start San Juan, P.R. Construction 1,653,000,000 MK Centennial, Inc.

Puerto Rico DOT Tren Urbano—Minillas

Extension

New start San Juan, P.R. Preliminary

engineering

478,000,000 MK Centennial, Inc.

Metropolitan Transit

Authority and

Regional

Transportation

Authority

East Nashville

Corridor Commuter

Rail

New start Nashville, Tenn. Preliminary

engineering

33,200,000 Transportation

Construction

Services, Inc.

Tri-Rail Double Track,

Segment 3

Rail mod Broward County,

Fla.

Construction 31,000,000 Urban

Engineers,

Inc.

Tri-Rail Double Track,

Segment 4

Rail mod Broward County,

Fla.

Final design 35,000,000 Urban

Engineers,

Inc.

Tri-Rail Double Track,

Segment 5

Rail mod Broward County,

Fla.

Preliminary

engineering

327,000,000 Urban

Engineers,

Inc.

Triangle Transit

Authority

Regional Rail,

Phase 1

New start Raleigh, N.C. Preliminary

engineering

475,000,000 Frederic R. Harris

Region 4 total $5,211,558,000

Region 5 (Chicago)

City of Chicago Downtown Subway

Rehabilitation

Rail mod Chicago, Ill. Construction 27,000,000 Sverdrup Civil, Inc.

City of Chicago Jackson Park

Improvements

Rail mod Chicago, Ill. Construction 31,000,000 Sverdrup Civil, Inc.

Chicago Transit

Authority

Douglas Branch

Reconstruction

New start Chicago, Ill. Final design 420,000,000 Sverdrup Civil, Inc.

Chicago Transit

Authority

Ravenswood Line

Expansion

New start Chicago, Ill. Preliminary

engineering

327,000,000 Sverdrup Civil, Inc.

Greater Cleveland

Regional Transit

Authority

Euclid Corridor Bus

Rapid Transit

New start Cleveland, Ohio Preliminary

engineering

220,000,000 Daniel, Mann,

Johnson, &

Mendenhall

Metra Central Kane Corridor New start Chicago, Ill. Preliminary

engineering

93,000,000 Sverdrup Civil, Inc.

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 30 GAO/RCED-00-221 Mass Transit

Metra North Central Corridor New start Chicago, Ill. Preliminary

engineering

177,900,000 Sverdrup Civil, Inc.

Metra Southwest Service

Corridor

New start Chicago, Ill. Preliminary

engineering

165,500,000 Sverdrup Civil, Inc.

Metro Transit and

Metropolitan Council

of Governments

Hiawatha Avenue

Corridor Light Rail

Transit

New start Minneapolis,

Minn.

Final design 548,600,000 Hill International

Ohio-KentuckyIndiana Regional

Council of

Governments

I-71 Corridor Light

Rail Transit

New start Cincinnati, Ohio Preliminary

engineering

875,000,000 Parsons

Transportation

Group

Region 5 total $2,885,000,000

Region 6 (Fort Worth)

Austin Capital

Metropolitan

Transportation

Authority

North/South Central

Corridor Light Rail

Transit

New start Austin, Tex. Preliminary

engineering

739,000,000 Daniel, Mann,

Johnson, &

Mendenhall

Central Arkansas

Transit Authority

River Rail Light Rail

Transit

New start Little Rock, Ark. Final design 13,000,000 Parsons

Brinckerhoff

Dallas Area Rapid

Transit (DART)

Authority

North Central Light

Rail Transit Extension

New start Dallas, Tex. Final design/

construction

517,000,000 Urban

Engineers,

Inc.

Fort Worth

Transportation

Authority and DART

Trinity Railway

Express (formerly

RAILTRAN)

New start Fort Worth, Tex. Construction 231,000,000 Urban

Engineers,

Inc.

Metropolitan Transit

Authority of Harris

County

Regional Bus Plan New start Houston, Tex. Construction 1,000,000,000 Stone & Webster

Regional Transit

Authority of Orleans

and Jefferson

Canal Street Corridor New start New Orleans,

La.

Final design 157,000,000 Parsons

Transportation

Group

Region 6 total $2,657,000,000

Region 7 (Kansas City, Mo.)

Bi-State

Development Agency

St. Clair Extension—

Phases 2A & B

New start St. Louis, Mo. Construction 416,200,000 Stone & Webster

Johnson County I-35 Commuter Rail New start Johnson

County, Kans.

Preliminary

engineering

30,900,000 Frederic R. Harris

Region 7 total $447,100,000

Region 8 (Denver)

Colorado DOT Southeast Corridor New start Denver, Co. Final design 1,670,000,000 STV, Inc.

Regional

Transportation

District

Southwest Corridor

Light Rail Transit

New start Denver, Co. Construction 178,000,000 STV, Inc.

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 31 GAO/RCED-00-221 Mass Transit

Utah Transit Authority Downtown to

University Light Rail

Transit

New start Salt Lake City,

Utah

Final design 118,500,000 Hill International

Utah Transit Authority North-South Corridor

Light Rail Transit

New start Salt Lake City,

Utah

Acquisition 312,500,000 Hill International

Region 8 total $2,279,000,000

Region 9 (San Francisco)

Bay Area Rapid

Transit (BART)

District

Car Rehabilitation Rail mod San Francisco,

Calif.

Acquisition 454,000,000 STV, Inc.

BART District BART Extension to

San Francisco

International Airport

New start San Francisco,

Calif.

Construction 1,483,000,000 STV, Inc.

Los Angeles County

Metropolitan

Transportation

Authority

East Side, Phase 3 New start Los Angeles,

Calif.

Suspended 979,000,000 Hill International

Los Angeles County

Metropolitan

Transportation

Authority

Mid-City, Phase 3 New start Los Angeles,

Calif.

Suspended 491,000,000 Hill International

Los Angeles County

Metropolitan

Transportation

Authority

North Hollywood,

Phase 3

New start Los Angeles,

Calif.

Construction 1,310,800,000 Hill International

Metropolitan Transit

Development Board

Mid Coast Corridor

Light Rail Transit

New start San Diego,

Calif.

Preliminary

engineering

117,000,000 Stone & Webster

Metropolitan Transit

Development Board

Mission Valley East

Light Rail Extension

New start San Diego,

Calif.

Final design 431,000,000 Stone & Webster

San Francisco

Municipal Railway

Advanced Train

Control System

Rail mod San Francisco,

Calif.

Construction 70,000,000 STV, Inc.

San Francisco

Municipal Railway

Light Rail Vehicles Rail mod San Francisco,

Calif.

Acquisition 514,000,000 STV, Inc.

San Francisco

Municipal Railway

Third Street Light Rail

Transit

New start San Francisco,

Calif.

Preliminary

engineering

462,000,000 STV, Inc.

San Francisco

Municipal Railway

Trolley Coaches Other San Francisco,

Calif.

Acquisition 208,000,000 STV, Inc.

North San Diego

County Transit

District

Oceanside-Escondido New start North San

Diego, Calif.

Preliminary

engineering

254,000,000 Stone & Webster

Regional Public

Transportation

Authority

Central Phoenix-East

Valley Light Rail

Transit

New start Phoenix, Ariz. Preliminary

engineering

884,000,000 Daniel, Mann,

Johnson, &

Mendenhall

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Appendix I

Major Capital Projects Covered by the

Project Management Oversight Program as of

June 30, 2000

Page 32 GAO/RCED-00-221 Mass Transit

Source: FTA.

Sacramento

Regional Transit

District

Folsom Extension Rail mod Sacramento,

Calif.

Final design 169,000,000 Gannett

Fleming,

Inc.

Sacramento

Regional Transit

District

South Corridor Light

Rail Extension

New start Sacramento,

Calif.

Final design/

construction

222,000,000 Gannett

Fleming,

Inc.

Region 9 total $8,048,800,000

Region 10 (Seattle)

Sound Transit Seattle Regional Light

Rail Transit (Link)

New start Seattle, Wash. Final design 2,480,000,000 Gannett

Fleming,

Inc.

Sound Transit Sounder Commuter

Rail

New start Seattle, Wash. Final design/

construction

820,400,000 Gannett

Fleming,

Inc.

Tri-County

Metropolitan

Transportation

District

Interstate “MAX” Light

Rail Extension

New start Portland, Oreg. Final design 350,000,000 Parsons

Transportation

Group

Region 10 total $3,650,400,000

Headquarters

Washington

Metropolitan Area

Transit Authority

Branch Avenue

Extension

New start Washington,

D.C.

Construction 920,200,000 Transportation

Construction

Services, Inc.

Washington

Metropolitan Area

Transit Authority

Branch Avenue Yard New start Washington,

D.C.

Final design 112,000,000 Transportation

Construction

Services, Inc.

Washington

Metropolitan Area

Transit Authority

Dulles Corridor Bus

Rapid Transit

New start Washington,

D.C.

Preliminary

engineering

253,000,000 Transportation

Construction

Services, Inc.

Washington

Metropolitan Area

Transit Authority

Infrastructure

Renewal Program

Other Washington,

D.C.

Various 1,500,000,000 Transportation

Construction

Services, Inc.

Washington

Metropolitan Area

Transit Authority

Largo Town Center

Extension

New start Washington,

D.C.

Preliminary

engineering

434,000,000 Transportation

Construction

Services, Inc.

Headquarters total $3,219,200,000

Grand total $47,524,558,000

(Continued From Previous Page)

Grantee Name Type Location Phase

Total

cost

PMO

contractor
Page 33 GAO/RCED-00-221 Mass Transit

Appendix II

Project Management Oversight Contractors ApendxiI

Carter & Burgess, Inc.

Daniel, Mann, Johnson, & Mendenhall

Delon Hampton

Fluor Daniel

Frederic R. Harris

Gannett Fleming, Inc.

Hill International

MK Centennial, Inc.

Parsons Brinckerhoff

Parsons Transportation Group

Stone & Webster

STV, Inc.

Sverdrup Civil, Inc.

Transportation Construction Services, Inc.

Urban Engineers, Inc.

(348193) Letr
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