Quick Take
The Highway 1 expansion project has run well over the initially estimated costs, leading the Santa Cruz County Regional Transportation Commission to approve an additional $3 million to Caltrans to cover its construction cost overruns, despite some pushback from several commissioners. Caltrans will return to the commission in August with a more detailed estimation of the project’s cost.
The Santa Cruz County Regional Transportation Commission (RTC) approved a motion at its Thursday meeting to allocate up to $3 million in additional funds for the Highway 1 auxiliary lane and bus-on-shoulder project segment between Soquel Drive and 41st Avenue to address significant cost overruns the California Department of Transportation has run into.
The commission also approved repurposing over $186,000 in federal earmark funds left over from the Morrissey Boulevard-Soquel Drive section of the Highway 1 project toward the construction component of the Soquel Drive-to-41st Avenue section.
The Highway 1 multimodal redevelopment project broke ground in early 2023. The expansive work is a major effort to redevelop stretches of Highway 1 and several overpasses in Santa Cruz County to better accommodate forms of transportation like buses, bicycles and pedestrians. Already, the freeway has seen some noticeable changes, such as the new bicycle/pedestrian overcrossing taking shape at Chanticleer Avenue. The Capitola Avenue overcrossing just south of the Bay Avenue/Porter Street exit is currently being rebuilt entirely.
Caltrans District 5 chief project manager Dave Silberberger said the state transit agency “dropped the ball” and likely needed more information about the project before finalizing initial cost estimates. He said Caltrans identified the overruns about a year ago and has since been in correspondence with the RTC as well as holding weekly status meetings with Caltrans staff to track the cost more accurately as the project continues to move forward.
“We don’t like to make mistakes, and we made one,” Silberberger said. “There are measures that we’re taking to try to cut costs wherever we can. The project is a complex one, but we take our job very seriously.”
Predictably, there was frustration among the 12 RTC commissioners regarding the newly estimated cost of the project. While Caltrans has yet to determine specifically how much the project will cost now, the additional $3 million would largely come from 2016 Measure D taxpayer funds — money local officials have already said is quickly running out.
“I’m not going to say mismanagement, but [Caltrans] obviously did not do the proper calculations,” said Commissioner Randy Johnson, a Scotts Valley city councilmember. “Why is the RTC responsible for the fact that Caltrans made their estimates and now they’re coming back to our taxpayers? Why should this body subsidize them?”
RTC Senior Transportation Engineer Sarah Christensen said the RTC’s agreement with the California Transportation Commission states that the RTC is responsible for cost overruns as the implementing agency.
“At the end of the day, we’re on the hook for the cost increase,” said RTC interim executive director Mitch Weiss. “So we’re not in a strong negotiating position.”
Other commissioners were initially opposed to approving the additional funding altogether.
“I don’t want to get into a situation where we’re approving a significant change in cost without more detail,” said Commissioner and District 1 County Supervisor Manu Koenig. “Then we might be opening the door for the same thing to happen again in the future.”
Koenig then offered a substitute motion to the staff recommendation, which would allow for the RTC to authorize up to $1 million in additional funds, rather than $3 million, and authorize the commission to hold an emergency meeting in July — normally a month without meetings — should Caltrans require more money. Commissioner Alexander Pedersen, a Capitola city councilmember, seconded the motion, but it ultimately failed. The commission then passed the original recommendation unanimously, coming to the agreement that it could not risk a significant stalling of the project.
Commissioner Andy Schiffrin, alternate for District 3 County Supervisor Justin Cummings, spoke to the unfortunate truth of project costs, despite other commissioners’ irritation.
“Cost overruns seem to be a way of life on these large construction projects,” he said. “We’ve faced significant cost overruns on the rail trail, and for the highway projects as well. This is not the first time this has happened, and it may not even be the last time for just this project.”
Christensen said Caltrans will come back to the RTC at its August meetings with more detailed information about the project costs, and what might be avoidable.
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