Larry Salci
Consulting Services
Saturday, December 16, 2017
St. Louis Metro-MetroLink Light Rail Project--Cross County Extension
President & CEO, St. Louis Metro

Project Overview
The Cross County MetroLink Extension (XCO) opened for revenue service on August 28th 2006. The extension added 10 miles and 9 new stations to the existing LRT system. The XCO alignment connects seven municipalities from the Forest Park-DeBaliviere Station to Shrewsbury. XCO also provides a vital link from Illinois and downtown St. Louis to the Clayton business district. The system alignment also had significant tunnel and elevated structures through the oldest and most densely populated parts of St. Louis and the adjacent 6 communities contrasted to the original system built in abandoned railroad rights-of-way. Actual ridership in 2007-08 exceeded 2010 estimates.

Project Schedule
In May 2000 Metro awarded a fixed price contract to an engineering consortium for Program Management, Engineering Design, Construction Management, and Start up Services with a Project completion of May 2005. However, by early 2002 the Project already had severe schedule and budget problems. The Project was already one year late due to incomplete and late engineering design and real estate and utility relocation delays by the consortium. The consortium requested more funding, via change orders, under a fixed price contract. There was the lack of a qualified Metro engineer assigned as Project Mgr. from 2000-02 and there was no independent engineering oversight consultant reporting to the Metro Board of Commissioners. The Stakeholder Project Oversight Committee created was never implemented.

I joined Metro in February 2002 and with the technical analysis of a new Sr. VP Engineering, immediately addressed the Project schedule and cost crisis with the consortium. I announced the Project schedule would be delayed 1 year to May 2006. However, the problems continued into 2004 under consortium management and the completion schedule had further deteriorated to early 2007. After two performance default notices to the consortium, I terminated the consortium’s contract in August 2004 and took direct control of the Project and created the Metro Construction Group (MCG) and hired new engineering consultants and Project Oversight Engineering consultants reporting to the Metro Board of Commissioners. After MCG’s months of time saving analysis and strategies a completion date was pulled back to October 2006. Through an insightful plan and creative approaches along with superior cooperation from the contractors, the MCG was able to ultimately pull the completion date back to August 2006, saving tens of millions of dollars of forecast project cost. The light rail system extension was commissioned by Metro in August 2006 without problem.

Project Finance
The Project was funded 100% with local sales taxes and financed through tax-exempt bonds debt serviced with the local sales tax. The original Project budget developed by the regional MPO was $404 million, but the estimate was in 1999 dollars, not inflated dollars, and omitted key Project cost elements, resulting in an unrealistic Project budget. The November 2001 Preliminary Engineering budget (30% design) was $550 million in 2005 inflated dollars, more realistic. I led the sale of $460 million of tax exempt bonds in November 2002, that included creative financial elements that financed the Project and provided needed capital to assist the agency in its overall financial crisis through FY-2007. However, due to the 15 month schedule delay, incomplete engineering and changes to the original project scope and configuration, the final cost was $668 million.

There were many lessons learned for Metro and the community. For future projects, I strongly recommended Metro , not the MPO, perform Alternatives Analysis and project conceptual cost estimates, use inflated dollars to properly develop reliable cost estimates, award separate contracts for Program Management, Design and Construction Management to avoid consultant engineer conflicts of interest, and Metro’s Board mandate and retain independent project oversight engineering consultants as part of Project Management Plan.