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Originally published Thursday, June 23, 2011 at 8:55 PM

Light-rail contract dispute is resolved

Sound Transit is finally ready to close its last major contract in the Seattle-Tukwila light-rail corridor, after arbitrators ordered that $66 million be paid to contractors in Rainier Valley.

Seattle Times transportation reporter

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Sound Transit is finally ready to close its last major contract in the Seattle-Tukwila light-rail corridor, after arbitrators ordered that $66 million be paid to contractors in Rainier Valley.

The award was based on costs to clean petroleum-contaminated soil, and to relocate underground utilities that were poorly described in design documents, among other woes that stretched the 33-month valley construction into 52 months.

Despite the arbitration award, Sound Transit will wind up $117 million below its overall budget of $2.44 billion for the whole Seattle-Tukwila route — meaning $80 million can be applied to rail extensions in Seattle and $37 million in the south suburbs.

"This was a challenging project and we're proud to have delivered it on time and under budget," said Ahmad Fazel, Link light-rail director.

But he said he was disappointed in the arbitration panel's findings and would study them to avoid making mistakes on future projects.

In all, the award of $66 million (of which $17 million was already paid), plus $10 million in earlier project changes, brings total payments up to $204 million for the RCI-Herzog team, which initially bid $128 million to build the trackway, stations, and new streets along four miles of Martin Luther King Jr. Way South.

Sumner-based RCI was acquired in 2005, midway through the Rainier job, by Parsons Transportation Group, based in California.

The Link line from Westlake Station to Tukwila International Boulevard Station opened in July 2009, followed by an extension to Seattle-Tacoma International Airport five months later. A tunnel to Capitol Hill and Husky Stadium is under construction, to open in 2016.

On-street construction is far cheaper than a tunnel and usually cheaper than elevated tracks. On the other hand, Fazel cautioned seven years ago that he considered Rainier Valley the most challenging section because it required tearing up the surface of an urban, residential area.

Both the transit agency and the builders were overwhelmed by more than 2,600 directives, orders and clarifications. Arbitrators said Sound Transit was aware before the contract award that the design was deficient, and failed to adequately tell RCI-Herzog the extent of the problems.

RCI-Herzog had to remove contaminated soil, causing havoc with schedules, arbitrators said.

For example, at just one lot, beneath and around the former Huy's Auto Center at the north end, costs hit $844,000, according to documents The Times examined.

The petroleum leaks happened long before the family owning Huy's immigrated from Vietnam.

Also, the contractors damaged themselves through bidding errors and poor schedule planning to finish the stations, the panel of three experts found. They blamed RCI-Herzog for 283 days of delay.

Sound Transit has attributed part of the problems to old, inadequate city of Seattle records of utility sites.

But transit managers also made a strategic decision to rely on records, instead of doing extensive digging and drilling to investigate the underground conditions beforehand — which would increase the noise and lane closures along MLK.

Jim Niemer, senior legal construction counsel, also said Thursday that such sampling wouldn't have saved a huge amount on the final soil and utility costs. "They were what they were," he said. "The work was going to have to be done anyway."

Nonetheless, Link ended under budget because most other construction contracts were finished at or near official estimates, and because Sound Transit included a large financial cushion at the time construction was approved in 2003.

Mike Lindblom: 206-515-5631 or mlindblom@seattletimes.com

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