‘Somebody’s Been Padding The Bills’

by Mark Scaramella, July 5, 2017

Caltrans Spokesperson Phil Frisbie has released an “explanation” from Caltrans District 1 Director Matt Brady about why Caltrans failed to include $159 million in their Willits bypass cost report. Frisbie’s tardy release followed a televised revelation byABC7 news reporter Jennifer Olney on the startling overrun.

According to Olney, “Caltrans spokesman Phil Frisbie said he saw the new total but did not give it to the public because he was not sure it was correct. It was.”

“Six weeks after the Bypass opened, another Caltrans document shows the true cost of the project had grown even higher to a total of $459 million. Caltrans did not issue a ‘correction’.”

So cover story #1 was: Prudent Phil Frisbie wasn’t sure about the number. Meaning perhaps that it could be high or low. Caltrans didn’t know. Phil didn’t know. Phil, we presume, made no effort to find out. Or, because he’s a mere CalTrans spokesman and not a decision maker, he was probably told to leave the lower number alone.

The neat thing about “We didn’t know,” is that in the case of Caltrans that’s a credible explanation.

Frisbie insisted that Caltrans was not hiding the true cost of the Bypass, that it was simply an error of omission. "All I can say is Caltrans is made up of imperfect people just like every other organization,” said Frisbie. “We did our best for transparency."

“Transparency” is hardly synonymous with Big Orange.

Frisbie next told Olney that the reason Caltrans gave out the lowball cost figures was the "discrepancy is due to some cultural changes at Caltrans."

Olney explained that Frisbie was was referring to how Caltrans had changed the way Caltrans handles costs for its own employees internally a few years ago. “[Frisbie] is referring to what Caltrans calls support cost, which is the cost of the Caltrans staff who work on each project,” Olney wrote. “For many years the agency did not include its own employees in total project costs, but after years of criticism that changed. According to Frisbie, ‘It's been Caltrans policy since about 2008 when we really started officially saying we need to make sure we include all the support costs because that gives the public really a better idea’."

Olney added, “Frisbie admitted that policy was not followed on the Willits Bypass. He cited changing policies and accounting systems, and told ABC7 News he thought the totals he gave the public included support costs, but they did not.”

If the policy is not followed it’s not much of a policy.

Olney continued, “Caltrans documents show support costs roughly doubled during the construction. They were estimated at $79 million in 2012, and up to $155 million by 2015. None of that was made public.”

So support costs “roughly doubled” during construction? What could that possibly mean? (Construction began in the summer of 2013.) And what makes up “support costs” anyway?

Olney wrote, “ABC7 News wondered why the Willits Bypass project managers did not alert Frisbie he was giving out the wrong figures, especially since they were creating internal spreadsheets that clearly showed the cost increases. We wanted to ask Matt Brady about that. He is director of the Caltrans district that includes the Willits Bypass, the most expensive project ever in that district. Brady said he was busy and preferred Frisbie do the interview.”

Mistake.

Frisbie had no idea. And he kept changing the story line. First he said he knew, but wasn’t sure. Then he said it was “changing policies” that weren’t followed, and then changes in “accounting systems.” Then he issued Mr. Brady’s explanation.

Olney: “After our interview with Caltrans, the agency posted a blog with the true cost of the bypass.”

The “blog” Olney refers to was this statement from Mr. Brady on June 26:

“Although the Willits Bypass is one of the most important interregional projects for the north coast, eliminating delays on U.S. Highway 101 and easing congestion for residents, the project did have its challenges. Bypass construction costs, including the associated right-of-way, mitigation, and relinquishment projects, did rise to $300 million as protests, permitting issues and bird-nesting season delayed the project. This was previously shared at public California Transportation Commission meetings in 2014 and through press coverage. Support costs including staff and consultants added another $159 million, bringing the total cost to $459 million. Those support costs include assessing the environmental impacts of over 30 potential routes, the development of the most extensive and detailed mitigation plan in Caltrans’ history, and then rewriting large sections of that mitigation plan to resolve issues with evolving requirements from permitting agencies. Caltrans did mistakenly report $300 million as the total cost of the project as part of our opening day ceremony, however, as indicated previously, it only included construction costs, mitigation, etc., which was not the ‘total’ cost, and this was an oversight on our part.”

Let’s set aside the fact that Caltrans has no data to support the claim that the bypass “eliminates delays” (a silly claim). But that’s just one in a long line of unsubstantiated claims from Caltrans.

We see that Brady first says that the $300 million number included “mitigation” cost. Then later in his statement Brady says that the additional $159 million included “the development of the most extensive and detailed mitigation plan in Caltrans’ history…”

So they developed an “extensive and detailed mitigation plan” which then had to be “rewritten”?

Is anybody in charge at Caltrans?

This “rewritten” reference is probably because the Army Corps of Engineers staunchly refused to issue the wetlands permit until pressured by Congressman Huffman, after which they reluctantly let it go with more grudging revisions from Caltrans (and with possible veiled threats or deal sweetening from Huffman). At the time Huffman said the Corps had to stop holding things up because the construction contractor was sitting idle, costing extra money.

The hugely expensive rewritten “mitigation plan” still leaves a lot to be desired (i.e., no real wetlands mitigation), but that’s another subject for another day by someone in Willits.

Olney: “The total could still go higher because Caltrans will be working for years to finish the environmental requirements [the mitigations]. That work already accounts for $90 million of the $460 million cost.”

Remember, Brady’s “explanation” — that Caltrans’ previous $300 million Bypass cost didn’t include their “support costs” in the “total” was due to “an oversight on our part” — was only provided after Ms. Olney dug it up from Caltrans own records.

Willits Environmental Center pioneer Ellen Drell told the Willits Weekly’s Jennifer Poole last week that Caltrans was so desperate to get the project approved that they intentionally low-balled the number because if the true cost were disclosed, the project probably would not have been funded.

Another funny thing is Caltrans’ claim that they “assess[ed] the environmental impacts of over 30 potential routes” and that raised the cost.

Did the “assessments” influence the choice? Obviously, the least environmental impact [and cheapest] choice would have been a truck route over the existing railroad right-of-way, but Caltrans didn’t pick that one. (We don’t know if it’s one of the 30.) But we do know that Caltrans picked one that needed tens of millions of dollars worth of “mitigation.”

Besides being asked to accept that Caltrans earlier $300 million number is correct — a number Caltrans has yet to break down in full — taxpayers are supposed to believe that the $159 million is correct and justified — and that Caltrans didn’t use the Bypass as a decades-long open charge account for whatever they wanted to charge to it for however long they wanted to charge to it and for however many people they wanted to assign to it.

Let’s convert the $159 million into man-hours. Assume that Phil Frisbie’s Caltrans salary and benefits of around $90k per year is average for the engineers and other well-paid staffers on the bypass project. But since it’s been going on for years (“roughly doubling during construction”), let’s adjust that average to $70k to reflect the fact that salaries have gone up in recent years and were not always at $90k.

So in very rough terms that gives us $159,000,000 divided by $70,000 which is about 2,270 man-years of work.

Or, somewhere between 1,500 and 3,000 man-years worth of “support” for the Willits Bypass.

That’s the equivalent of somewhere between 150 and 300 people working full time on the Willits bypass project for ten years over and above the $300 million.

If support costs “roughly doubled” during construction (two years) that translates to 125 people for eight years and 250 during the last two on the low end; and 250 for eight years and up to 500 during construction on the high end.

Of “support”?

However, you slice and dice these numbers, they’re a joke.

Clearly, Caltrans District 1 was using the Bypass as a blank check for whatever they wanted to charge to it with whatever “accounting systems” were or were not in place.

Some of us remember those nice pics in the Willits News in the 90s and 2000s of ten or twelve young Caltrans engineers periodically traipsing into Willits in their hard hats to sell the project to the gullible locals. Caltrans was supposed to be taking local input — input they studiously ignored.

Then there’s the dubious nature of just about everything Caltrans says about its costs.

In one recent example, we had Caltrans saying that Bypass protester Will Parrish owed Caltrans almost half-a-million dollars because Parrish climbed up a stitcher machine during the early days of construction and stayed there for almost 12 days, disrupting the project — according to Caltrans.

As the Parrish interlude played out in court over several months, the amount the stalwart lad’s equipment sit had cost CalTrans in alleged delays kept coming down. First Caltrans said Parrish’s protest cost over $490 mil. Then they said, no, sorry, it’s $482k ($481,155 to be exact). A few weeks after that as court was approaching and Caltrans began to realize they might have to defend the number in court, it was reduced to $155k ($154,733 to be exact). When the first hearing day arrived it was down to a nice even $108k. Ultimately, Judge John Behnke dismissed most of Caltrans cost claims and fined Parrish just under $10k.

The Parrish case was another example of CalTrans simply picking numbers that they think are plausible, but proving only that they’re either lying or grossly incompetent.

At one point during this series of downward revisions Mendocino County Superior Court Judge John Behnke commented that he knew that “someone’s been padding the bills,” referring to Caltrans cost estimates.

Behnke may have been referring to the Parrish case, but he could just as well have meant the entire project.

At another point Caltrans said they’d spent $12 million (!) “guarding” the bypass by assigning dozens of CHP officers to stand around getting overtime on the off-chance a hippy or a Willits News photographer might wander on to the construction site and have to be lead off in handcuffs. This was a typical over-reaction from Caltrans showing again that they thought they had a blank check without concern for the actual cost to the taxpayers.

But the big question is: Who’s paying for the extra $159 million? Where did it come from? Did Caltrans just “eat it”? Did they borrow some money that has yet to be paid back? Did some other project(s) under-run by $159 million? Was some other funded project canceled?

In the run-up to the final go-ahead for the Bypass, Caltrans and Mendo had to do some heavy political lifting to get the money they got as the cost estimates kept going up. Statewide priorities were juggled and the Highway 20 interchange was eliminated because Big Orange said it was too expensive (although nobody said how much was saved by eliminating that interchange). Now we find out that Caltrans had $159 million or more sitting around to be magically tapped? Why couldn’t they include the Highway 20 interchange then?

The point here is that Caltrans may end up presenting a bill to Mendocino County via the Mendocino Council of Governments (MCOG) for some portion of their $159 million (or more) of “support costs.” Over the years MCOG has allocated tens of millions of local road dollars back to Caltrans for the local share of bypass costs instead of spending it on local roads and bridges.

If MCOG/Mendo gets a multi-million dollar demand from Caltrans to cover some significant percentage of their $159 million “oversight,” Mendo should refuse and tell Caltrans to itemize the bill, then threaten to haul them into Judge Behnke’s court and defend their numbers.

Nobody seems to mind that Caltrans can waste tens if not hundreds of millions of taxpayer dollars on unaccountable “support” for a boondoggle of a Bypass project, the benefit of which pales in comparison to its ever increasing cost. But Caltrans should not be allowed to do it at the cost of Mendo’s dilapidated roads and bridges.

6 Responses to ‘Somebody’s Been Padding The Bills’

  1. james marmon Reply

    July 5, 2017 at 12:12 pm

    My big brother, Steve Marmon, just spent the last 4 years laboring for Decker Landscaping, the company doing the mitigation work. He said it was crazy up there, no sooner than his crew would finish one section of the project, Flat Iron, the main contractor would come in and tear it up and they would have to come back and redo their work, as many as 3 or 4 times on just a small section. This was regular business.

    My 65 year old OCD workaholic brother almost physically killed himself on that bypass job, and is currently recovering at home from severe psychological trauma from the experience. Me turning Republican helped relieve him of some of his most serious symptoms, but we still have a lot of work to do.

    James Marmon MSW
    Steve Marmon’s little brother.

    • james marmon Reply

      July 5, 2017 at 12:21 pm

      P.S., don’t say the word “Flat Iron” around him, just a warning.

      • james marmon Reply

        July 5, 2017 at 12:38 pm

        I’m not going to tell him that you guys are blaming “Big Orange”. I don’t want any setbacks.

        • james marmon Reply

          July 5, 2017 at 1:44 pm

          He is actually doing better on the “Flat Iron” thing, in the process of re-directing blame where it belongs, the environmentalists.

  2. lindyj Reply

    July 6, 2017 at 12:04 pm

    RE: “Padding the Bill”
    Between Cal Trans, the Army Corps of Engineers, the contractors AND the environmental lobby, we poor taxpayers are left holding the bag. It is a miracle anything can be built in CA in this day and age. So our so-called “Green” Governor, Mr. Brown says California’s roads are in bad shape and arbitrarily raises the gasoline and car registration fees to generate more money for the Cal Trans grist mill. As a lifelong California resident, I keep wondering when the public will wake up and see that California is being driven off a cliff.

    • james marmon Reply

      July 6, 2017 at 12:25 pm

      One of the Caltrans engineers on the bypass is actually married to one of my cousins, don’t blame her.

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