Reston Spring

Reston Spring
Reston Spring

Saturday, October 8, 2011

Parsing Half-truths on Dulles Rail, Phase 1

Earlier this week, several Washington-area newspapers disclosed that construction of Dulles rail Phase 1 was probably behind schedule and over budget in light of newly revealed information.  Most articles focused on a report that that two-thirds of of the Phase 1 contingency fund had been used, yet the construction was only halfway complete.  The Washington Examiner also acquired a copy of a contractor (Dulles Transit Partners--DTP) progress report (which it wrongly characterized as an "audit" in the headline) that suggested Phase 1 could be as much as 188 days behind schedule.  Then, on October 6, MWAA and DTP admitted there would be a delay in completing Phase 1:  MWAA says it will be nine days, DTP says it could be much longer.

Then the fur began to fly.

The Examiner published an editorial beginning, "Metropolitan Washington Airports Authority Chairman Charles Snelling finally admitted that he deliberately misled the public when he stated it was 'beyond dispute' that Dulles Rail was' on time and on budget.' Turns out it is neither -- a fact Snelling and his fellow MWAA Board members knew all along, stripping the last pretenses of transparency and accountability from one of the largest infrastructure projects in the nation."  

While the bulk of the editorial focused on Snelling and MWAA's deception, some of it took shots at the Fairfax County Board of Supervisors, particularly former Chairman (now Congressman) Gerry Connolly and current Chairman Sharon Bulova, including the following paragraph:
Snelling's dissembling is particularly troublesome because Fairfax County taxpayers are responsible for all Phase I cost overruns, which are now approximately $240 million to cover the six-month delay. Taxpayers can mainly thank former Fairfax County Board Chairman Gerry Connolly, who is now a Democratic member of Congress, and current board Chairwoman Sharon Bulova. Snelling's less-than-candid assurances were an attempt to deprive taxpayers of a true accounting of this runaway project before November's county and state elections.
Less than 24 hours later, Fairfax County disseminated a statement denouncing the Examiner editorial, setting the tone with this opening statement: "The Examiner is entitled to its own opinions but not its own facts."  Here's the full text of the County release:
The 10/5/11 Examiner newspaper commentary entitled “Airports authority head lied, and transparency died” contains its own inaccuracies. The Examiner is entitled to its own opinions but not its own facts.
This opinion piece stated “Fairfax County taxpayers are responsible for all Phase I cost overruns, which are now approximately $240 million to cover the six-month delay.”
There is nothing factual about this statement.  This editorial was based on speculation.
The Dulles rail project is very complex, and it remains to be seen whether or not it is completed on time since maintenance of the schedule is dependent on numerous factors, and mitigation measures are already underway to address any potential delays.
But more bothersome are the stated falsehoods about funding responsibilities.
At their June 18, 2007 meeting, the Fairfax County Board of Supervisors authorized a local funding agreement with the Metropolitan Washington Airports Authority (MWAA) and Loudoun County and also authorized expenditure of funds from the Dulles Corridor Phase I Special Improvement Tax District for the construction of the Dulles Corridor Metrorail Project. This agreement committed Fairfax County to funding a percentage of the total cost of construction.
Thus for many years, the funding responsibilities have been transparent: MWAA, Loudoun and Fairfax Counties will pay 4.1, 4.8, and 16.1 percent respectively of the total project cost; the remaining 75 percent comes from the Dulles Toll Road and state and federal funding.
Bottom line: Fairfax County taxpayers would only be responsible for a portion (16.1 percent) of any Phase I cost overruns, and in fact, there are no cost overruns to date.
Fairfax County continues to advocate reductions in project costs and is carefully monitoring the cost structure, start of revenue service and funding obligations. All the partners are working together to ensure that the Dulles Corridor Metrorail Project Phase I moves forward and becomes a reality bringing much needed public transit improvements to Tysons Corner and Reston.
Somewhere in between the Examiner editorial and the County press release lies the basic truth as we are able to discern it at this point.  We don't know the whole truth because both MWAA and County officials so far refused to provide it.  But here is what we do know:
  • Snelling knowingly, willingly, and intentionally misled the public--I'd call that "lying"--about the current status of Dulles rail Phase 1 when asked about it by saying it was on time and within budget.  His re-characterization of that statement in the most recent newspaper accounts--that he expected Phase 1 to make up ground in the next two years--was itself a deceptive, post hoc excuse for his earlier statement.  In short, the Examiner has this point pinned down.
  • The County statement says, "This editorial was based on speculation."  That is factually incorrect.  The several newspapers that reported on the possible cost overruns and delays in Phase 1 has documentary evidence that this was the case.  Indeed, on the very day the County published its statement, MWAA and DTP were admitting that Phase 1 was behind schedule.  Either the County did not know what was happening or is was intentionally misleading its readership.  Either situation is unacceptable.  
  • The County statement says, ". . .  in fact, there are no cost overruns to date."  It is true than no cost overruns have yet been admitted by MWAA or County officials, but that does not mean there have not been cost overruns to date.  Indeed, the excessive use of the contingency fund is a strong indicator of cost overruns and the admitted delays will almost certainly mean cost overruns.  And, with the lack of transparency so far demonstrated by County and Airport authorities, we're not likely to know specifically hos much those overruns are until we get the bill in higher taxes and tolls. 
  • The Examiner's statement that Fairfax County taxpayers are responsible for "all" cost overruns for Phase 1 is not true, but county taxpayers--especially those who use the toll road--will likely pay the bulk of the overruns.  The taxpayer portion of any cost overruns will be 16.1% as stated by the County under the current funding agreement.
  • The County statement that ""the remaining 75 percent (of the payment for cost overruns) comes from the Dulles Toll Road and state and federal funding" is grossly misleading.  The fact of the matter is that the federal and state funding has been fixed and committed, and that 75% portion of all overruns will be paid by Dulles Toll Road users.  This could add as much as a dollar to tolls, which were already likely to triple or even quadruple in the next five years if Phase 2 proceeds.  Think of $7-$10 full tolls in 2016--before Phase 2 is completed.  
  • The County's statement highlights its decision on June 18, 2007, to agree to the current funding arrangement as defining the shares of the participants.  It made that agreement (with MWAA and Loudoun County) knowing then (indeed, the agreement was driven and necessitated by) that the federal and Virginia governments had no intention of contributing further funding to either Phase 1 or Phase 2 of Dulles rail.  The agreement sticks Dulles Toll Road users with 75% of all new costs for Dulles Metrorail and, based on the last official MWAA allocation of costs, 56% of the total cost of the line.  This is exactly why toll road users may expect tolls growing to $10, $15, $20, and more in the decades ahead.  Yet, to this writer's knowledge, none of the partners--MWAA, Fairfax, or Loudoun--held public hearings disclosing the terms of the draft agreement before they signed it.  More than any other cynical part of this financial catastrophe, this shows the callous disregard of both elected and appointed officials for the constituents they are suppose to be serving.  (I challenge any of these groups to identify a public hearing in which this agreement was the topic.)  They all ought to be kicked out of office.

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