Streetcar delay cost Cincinnati nearly $1M

Cincinnati City Council's decision to temporarily shut down work on the streetcar project in December cost almost $1 million – and some delay costs remain unknown.

However, it appears the three-week work stoppage will cost less than originally projected by an independent auditor's report and will not delay the launch of when people can ride the streetcar.

It cost $987,108 for a 20-day work stoppage while City Council debated whether to fully cancel or move forward with the streetcar, project leaders announced Tuesday.

In December, global auditing firm KPMG projected a one-month delay to cost between $1.7 million and $2.8 million.

"It's lower than we anticipated, and I'm pleased with that," said City Councilwoman Amy Murray, who originally favored permanent cancellation.

The delay cost is not added onto the project's overall $133 million price tag, but will be deducted from a $9.4 million contingency fund already in place. So far, $1.96 million of that has been spent – with a majority of construction still to come before the streetcar is operational in September 2016.

Mayor John Cranley led efforts to permanently shut down the project after he took office Dec. 1, fearing the streetcar would drain money from public safety and other essential city services in an already difficult budget climate. But during ongoing, sometimes-contentious debate at City Hall, three council members changed their minds and supported moving forward with the project – a shift that led to a veto-proof vote on Dec. 19.

Cranley continues to oppose the project, and said Tuesday the delay cost is inconsequential at this point.

"We would've saved $40 million out of the capital budget and all of the operating costs in the future," Cranley said. "From my point of view, the most affordable option would be to stop it."

Cranley added: "The only regret I have is council changed its mind. I still think the city would be better off without it."

The 20-day delay is expected to push the completion date of most of the construction to April 4, 2016, from March 15, 2016. However, as originally planned, the streetcar is not expected to be open to riders until Sept. 15, 2016, because the system requires an extensive testing phase.

Workers last week completed track installation on the first mile of the 3.6-mile streetcar loop through parts of Downtown and Over-the-Rhine.

The delay cost includes $637,108 for lead contractor Messer/Prus/Delta; $250,000 for the KPMG report; and $100,000 to barricade and secure construction zones during the shutdown. The delay cost also considered two missed days of construction because of sub-zero temperatures, said John Deatrick, the city's streetcar project leader.

The delay cost for passenger rail car manufacturer CAF USA remains unknown – although the KPMG report projects the pause will cost the rail car company between $25,000 and $150,000. Streetcar project manager Chris Eilerman said CAF's delay costs are not expected to be significant.

If KPMG's projections are correct about CAF, the final delay cost would be lower than originally expected. CAF's delay costs are not yet known because project leaders and engineers are reviewing the design of the five, 154-passenger streetcars this week. Results of the review could impact the manufacturer's completion schedule, project leaders said.

Parts for Cincinnati's rail cars are being manufactured at CAF's headquarters in Spain. Some parts are scheduled to be shipped to the company's Elmira, N.Y., factory later this spring for assembly, and the cars are expected to be delivered to Cincinnati for testing by the end of 2015.

A spokesman for Washington, D.C.-based CAF USA did not return a message.

Streetcar project leaders said some subcontractors originally asked to be paid more money for the delay, because they did not return to work on Dec. 26 – the first day work resumed after the council vote. Some subcontractors even took on more jobs during the delay.

"Some of the subcontractors put in for more than 20 days," Deatrick said. "Some of them came in later, but it was on them because they were supposed to maintain their workforce by (state) regulation."

Project leaders said negotiations with contractors were "congenial" and they spent extra time making sure everyone was pleased with the final amount to avoid any lawsuits and maintain a strong relationship.

Representatives from Messer, the lead contractor, and Prus did not return messages.

City Councilman Kevin Flynn questioned the validity of the final delay cost during council's transportation committee meeting Tuesday. He questioned if it cost $100,000 to put up safety barricades and cover holes in the street. Council approved up to $100,000 for that purpose in December, and project leaders said the final cost of that portion of the delay isn't fully known yet and could end up being lower.

Flynn also questioned whether contractors would have worked the full 20 days in December because of the frigid weather.

"If they're getting compensated for time that they weren't going to be working anyway, that's not good money spent," said Flynn, among council members who changed his position to favor the project. "I'm not blaming (the contractors or project leaders). I just want to know what the real numbers are. Fair question."