MOORLACH UPDATE — Bay Bridge Bloat — October 29, 2015

The topic of Caltrans will continue to come up as long as our Governor insists on raising more taxes to fix California’s roads. Why more taxes? Because the Governor’s budgets have diverted the funding dedicated for roads to other purposes, such as funding the ever growing pension plan contributions going into the California Public Employees Retirement System (CalPERS) (see MOORLACH UPDATE — Pothole Tax — August 30, 2015 august 30, 2015 john moorlach).

While gas tax revenues have increased:

The overall spending for caltrans has remained the same:

It is much more difficult to ask the voters to approve a tax increase to fund public employee pension contributions than claiming poor boy on road conditions. This may explain why the state’s public employee unions support the proposed tax increases dedicated to Caltrans.

Steven Greenhut of the San Diego Union Tribune provides his perspectives in the first piece below. He and I had a long chat on what should be done at Caltrans.

We need to find a way to help Caltrans remake itself so it can meet the challenges of the 21st Century. It needs to be more nimble and responsive to the state’s changing needs. Caltrans must be willing to change its corporate culture to reclaim its position as the nation’s #1 transportation agency.

Here are my four recommendations:

1. Do a thorough review of Caltrans’ general ledger. Both the State Auditor and the State’s Legislative Analyst’s Office have publicly complained about the lack of transparency at Caltrans. This is inexcusable.

2. Compare the spending metrics with the other 49 state departments of transportation. How does Caltrans compare? Spending three times the national average on roads is unacceptable (see MOORLACH UPDATE — Money for Nothing — September 2, 2015 september 2, 2015 john moorlach).

3. Change the culture within Caltrans. It is too insulated and, in a period of term limits, this bureaucracy just blows off the elected legislators, as they will be gone in a few years. Address the apparent tone deafness of Caltrans’ leadership and the cavalier arrogance of its communications department. The Bay Bridge illustrates that there is something drastically wrong with the internal management of Caltrans (see our release from yesterday at the bottom) and the track record is intolerable.

4. Unfetter the dominance and influence that the public employee unions have over Caltrans. It was the union that spoke against my bill, SBX1-9, not management (see MOORLACH UPDATE — SBX1-9 — July 18, 2015 july 18, 2015 john moorlach and MOORLACH UPDATE — Cost of Engineers — August 26, 2015 august 26, 2015 john moorlach). The control of the public employee unions is costing the taxpayers too much in overruns and compensation packages, which are nowhere close to competitive with the private sector. This is unaffordable. Caltrans must also outsource more of its work. It’s current low allocation is unexplainable.

The second piece is from the Voice of OC and announces the return of Rick Reiff’s "Inside OC" PBS television show. In my travels around the country, it astounds me that small metropolitan areas have multiple television stations covering the area. Orange County does not have one. We are part of the LA market. Thus, Rick Reiff’s coverage is an excellent resource for those more focused on the OC. I recommend that you set your DVR to capture this weekly program.

Now to the Bay Bridge. We compared it to the Golden Gate Bridge’s construction 78 years ago. With our communications, we receive feedback, which I love. So, let me provide some background for clarity.

1. The 1.7 mile-long Golden Gate Bridge was completed nearly 80 years ago at a cost of $35 million. Adjusted for inflation, that number in 2013 dollars (the year the eastern span of the Bay Bridge was completed) would be $566 million total, or $333 million per mile, according to the Bureau of Labor Statistics. By contrast, the Bay Bridge’s new 2.2 mile-long eastern span cost $6.4 billion to complete, or $2.9 billion per mile!

Length (Miles) Construction Cost2013 Inflation Adjusted Dollars Cost Per Mile
Golden Gate Bridge 1.7 $566,214,930 $333,067,605
East Span Bay Bridge 2.2 $6,400,000,000 $2,909,090,909

The data does not lie. The difference in cost is staggering, and it begs a review of our entire regulatory structure (thank you CEQA and NEPA), as well as a review of the spending and oversight practices at Caltrans. That was my point in releasing this data yesterday.

2. The bridge was first scheduled to open in 2007. It did not open until 2013. Caltrans first estimated the cost at $1.5 billion. It ultimately came in at $6.4 billion. Although it went through several political debates over design changes, those design changes and delays were largely a function of Caltrans’ huge budget overruns to the State’s ongoing Seismic Retrofit Program, as well as poor Caltrans leadership in finalizing decisions.

After much chaos, the self-anchored-suspension (SAS) design, which had been previously abandoned due to its huge cost, was decided upon, since cost estimates for other options were found to be woefully understated. Assembly Bill 144 was signed in 2005 and provided the increased funding for the Toll Bridge Seismic Retrofit Program, under which the Bay Bridge would be finished.

To understand more about this, reference the 2005 LAO Audit of the retrofit program found here: http://www.lao.ca.gov/2005/toll_bridge/toll_bridges_012405.htm.

The purpose of the LAO’s report is outlined here:

This report first provides a brief history of the Department of Transportation’s (Caltrans’) toll bridge seismic retrofit program. It then (1) explains the current status of the program and the administration’s proposal to complete it, (2) discusses several factors the Legislature should consider when deciding whether to redesign the Bay Bridge, and (3) identifies the key options available to the Legislature for funding the program.

3. It’s the most expensive bridge in world history, as the San Jose Mercury News points out here: http://www.mercurynews.com/news/ci_23833908/costs-14-most-expensive-suspension-bridges-across-world. There has been tremendous scrutiny over the design flaws. Due to the insular nature of Caltrans, I am trying to make some strong points.

Why?

Again, and it is worth repeating, we must find a way to help Caltrans remake itself so it can meet the challenges of the 21stcentury. It needs to be more nimble and responsive to the state’s changing needs. Caltrans must be willing to change its corporate culture to again become the nation’s #1 transportation agency.

Does bloated Caltrans need more cash?

Transportation battle sidesteps issues of misspending and reform

Mugshot of Steven Greenhut

Steven Greenhut

The first World Series game this year was reportedly a great one, complete with five hours of extra-inning ball play and an inside-the-park home run. I missed it, but the beginning of every World Series game always reminds me of 1989. Just as the first pitch was about to be thrown to start Game 3, the television screens went blank.

That’s when the Loma Prieta earthquake struck San Francisco, which was hosting the Giants v. Athletics series. The magnitude 6.9 earthquake caused massive damage throughout the Bay Area, killing 63 people and causing more than 3,700 injuries. It was a devastating event – made more harrowing because it was televised nationally.

The temblor destroyed a portion of the upper deck of the San Francisco-Oakland Bay Bridge, which was made functional again within a month. But transportation officials found the bridge to be in need of a long-overdue reconstruction of the west span and the building of a new east span. The Bay Bridge project was begun shortly thereafter and completed 24 years later amid cost overruns and recriminations.

It’s a beautiful, well-functioning bridge – but investigations and news stories about its problems persist to this day. The entire project is an allegory for California’s enduring transportation problems.

“After the 1989 Loma Prieta earthquake that rocked the Bay Area, officials got serious about rebuilding the vulnerable Bay Bridge …,”reported the Atlantic magazine’s Citylab. “The first cost estimates, released in 1995, figured both east and west spans of the bridge could be upgraded for a cuddly $250 million. By the time the new east span opened in September 2013 the price tag for that span alone had reached a reported $6.5 billion, with a B.” That’s a 2,500 percent increase.

And then there are the myriad controversies. State Senate hearings last year focused not so much on the long delays and enormous cost overruns – but on the allegations of substandard work and falsified engineering reports. Former Sen. Mark DeSaulnier, the Concord Democrat who is now a U.S. congressman, even called for criminal investigations.

Californians of all political stripes are in rare agreement the state’s infrastructure of roads, bridges and freeways is woefully underfunded. But the Legislative Analyst’s Office and the state auditor often find misspending, bad priorities and bureaucratic problems at the California Department of Transportation. For instance, auditors found 3,500 unnecessary positions there. That problem was reinforced by the auditor’s report from August spotlighting a Caltrans engineer who played golf on 55 workdays – yet his time sheet was approved by the agency.

Auditors found the agency’s projects to be over budget a whopping 62 percent of the time. Caltrans spends three times the national averageon its per-mile road spending, making California one of the least-efficient users of existing tax dollars. Meanwhile, the state’s infrastructure is crumbling. A recent Contra Costa Times report found that “years before last week’s frightening collapse of an Interstate 880 overpass guardrail and chain-link fence onto evening rush-hour commuters, the state had declared the overcrossing outdated and dangerous.” Scary stuff.

The reaction from the governor and state legislative leaders: a push for new fees on cars and a significantly higher gas tax. Gov. Jerry Brown seemed perturbed that legislators headed home without hiking transportation taxes.

But freshman state Sen. John Moorlach of Orange County, one of the GOP’s leaders on the transportation issue, released an analysis last month showing that gas-tax revenues have increased $1.75 billion in the past six years, yet state spending on infrastructure projects has remained stagnant. The state has spent the money on other priorities, he noted.

“It’s easier to say, I need a tax for roads than I need a tax to fund pensions,” Moorlach told me, arguing the governor is choosing to backfill the state’s underfunded pension system instead. It’s the same sleight-of-hand some cities are doing, as they divert road funds to public-employee compensation – and then ask voters to approve a pothole tax.

And few Sacramento leaders are seriously pushing for an overhaul of the agency charged with managing the state’s road and bridge projects – despite audits that year after year show high pay, overstaffing and bureaucratic bloat. Moorlach says the agency is insulated and immune to reform.

This brings us back to the Bay Bridge. Officials knew for years it wasn’t up to snuff if an earthquake hit. After it hit, it took 24 years and massive cost overruns to fix it. Those rebuilt portions are subject to myriad controversies. Certainly, Californians need to invest more in their crumbling infrastructure, but it might be easier to accept higher taxes if there were a serious attempt to better use existing dollars – rather than put up with this shocking level of inefficiency.

Greenhut is the San Diego Union-Tribune’s California columnist. Write to him at steven.greenhut

Rick Reiff’s Inside OC is Back

By Norberto Santana Jr.

PBS So Cal is bringing back it’s popular public affairs show focused on Orange County politics and government with host, Orange County Business Journal Editor at Large, Rick Reiff.

The new Inside OC is premiering on Tuesday, Nov. 3 at 1 a.m. and will also repeat six times a week on PBS SoCal’s family of channels and available on-line.

Reiff has already produced two “test run” shows that can be seen with afeatured panel discussion including OC Bar Association President Ashleigh Aitken, the OC Register’s Brian Calle andWatchdog.org‘s Will Swaim discussing the county’s jail informant scandal and other stories.

An interview segment with Voice of OC Publisher Norberto Santana Jr. is also posted online with Santana discussing the Voice of OC model and the future of online non-profit news.

Reiff announced that other top officials who have already agreed to appear on the show are U.S. Rep. Loretta Sanchez, State Sen. John Moorlach, and former Allergan CEO David Pyott.

The effort is being sponsored by Five Point Communities, PBS SoCal and KDOC (as studio host) and Reiff has put together a talented production team – including co-producer Scott Hays, editor Richard Garippo and director David Marquez.

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#CALTRANS WATCH

The Tale of Two Bridges:
A good example of what’s WRONG with Caltrans

Golden Gate Bridge:

Build Time: 4.5 years, completed 8 months ahead of schedule

Cost: $35 million, 4% under budget

Lifespan: 78 years old and counting

Declared: “Wonder of the Modern World"

SF/Oakland Bay Bridge – Eastern Span

Build Time: 11 years, completed 6 years behind schedule

Cost: $6.4 billion, at least 300% over budget

Lifespan: 2 yrs old, but design flaws could produce premature failure

Declared: “Most expensive public works project in California history”

This Week’s Bay Bridge News:

Fears of failure grow for rods on Bay Bridge eastern span

“Potentially widespread problems that experts warn could lead to premature failure…The rods are more vulnerable than Caltrans’ test results suggest.”

"It’s a very shoddy job all the way around…Clearly there was no quality assurance on anything…” http://www.sfgate.com/bayarea/article/Fears-of-failure-grow-for-rods-on-Bay-Bridge-6588743.php

Statement from Senator John Moorlach

“The Bay Bridge debacle is the most serious sign that Caltrans is a broken agency. There needs to be an immediate top-to-bottom review of its management and structure, followed by house cleaning and reorganization. It’s a tragedy that Californians pay the highest transportation taxes and have the worst roads to show for it.”

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This e-mail has been sent by California State Senator John M. W. Moorlach, 37th District.

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