Politicians and residents are shrugging off millions of dollars
in cost overruns for new public facilities
Just off the tops of our heads, we can compile a depressing list of public projects that have exceeded their estimates, some before a shovelful of soil was ever turned:
– Christopher High School (GUSD)
– Barrett Elementary School (MHUSD)
– Gilroy Police Station (City of Gilroy)
– South County Courthouse (Santa Clara County)
The fact that we’re amazed when a government project – like the Morgan Hill police station that opened in 2004 – is delivered on budget shows how badly broken the process of seeking and awarding bids now is.
A few ideas for ways to close loopholes and create pressure of government employees and elected officials to create realistic project estimates that the public can trust are in order.
First, the system needs to create pressure for government employees to estimate projects more precisely. Those responsible must spec projects precisely before they are sent out to bid. Projects need to be created with little room for change orders based on bad design decisions. Fingers pointing to the latest news headline (real estate prices, steel or gas prices, hurricanes, earthquakes, political unrest, heavy rain) as the reason for a spike in some construction commodity or another are tired excuses. These factors have been with us since the first government project was built, and we should be able to account for them – at least to a reasonable extent – in the beginning of the process.
To build that pressure, government agencies should be forced to repay cost overruns from their general funds. If bad project estimation means cuts in police, social services or infrastructure for a few years while that multimillion dollar “goof” is repaid, many special interests will have lots of reasons to make certain that projects are honestly and correctly estimated at the beginning instead of at the end.
Second, any contractor who bids on a project must be required to disclose cost overruns on their last 10 public projects. That factor must be sufficiently weighted by agencies when evaluating bids to eliminate those contractors who routinely underbid to win contracts and then find ways to manipulate the system for more taxpayer dollars later.
Third, and perhaps most important, we ask our fellow residents: Where’s the outrage? How many letters to the editor have been written, how many calls to County Supervisor Don Gage have been placed after news broke that the $32 million county courthouse under construction in Morgan Hill now sports a
$50 million price tag?
Ultimately, we get the kind of government we demand. If we accept cost overruns as par for the course, that’s what we’ll get. If cost overruns anger you, then let your elected officials know. Call, write or do both, and let them know.
