2016 | Politics

County Council Members Accuse State of Not Sharing Purple Line Savings

State transit officials deflect questions by saying the only way the project could move forward is if significant savings to state's cost could be made

State transportation officials, left, take questions from Montgomery County Council members, seated right, during a meeting Monday afternoon

Some Montgomery County Council members Monday expressed frustration with the state for failing to share cost savings for the Purple Line project with the county.

Council member Craig Rice admonished state transit officials who attended a briefing Monday afternoon for cutting overall construction costs for the project while the county’s Purple Line costs increased.

“I think it’s ridiculous the state is coming to us, sitting on a surplus, asking us for additional money,” Rice said.

Council member Roger Berliner said the county had talked with the state about its desire to share cost savings in the past.

“We stressed the 'split the savings concept,' ” Berliner said. “What happened to the 'split the savings concept'?”

State and county transportation officials said Monday they were able to trim the county’s overall construction costs for the projects it agreed to build for the Purple Line by about $4 million—down to about $169.5 million.

However, that’s still $10 million more than what the state had estimated county costs would be before the state announced an agreement in March with Purple Line Transit Partners, the private team of developers and construction companies tasked with financing, building and operating the 16.2 mile light-rail line.

The county agreed to fund three Purple Line projects—constructing a south entrance elevator bank to connect the Bethesda Purple Line station with the Bethesda Metro station, rebuilding the Capital Crescent Trail between Silver Spring and Bethesda, and building the Silver Spring Green Trail.

Under the current estimates provided to the state by Purple Line Transit Partners, the south entrance elevator bank’s cost nearly doubled to $113 million from an earlier state estimate of $58.4 million. The cost to rebuild the Capital Crescent Trail, however, dropped from $96 million to $58 million and the Green trail decreased from $4.3 million to about $2 million.

The net result was that the county share’s of expenses would increase by $14 million. The state shaved $4 million from that number in recent weeks by eliminating $1 million in elevator equipment room costs as well as slashing $3 million in administrative oversight costs, officials said Monday.

That leaves the county with the $10 million increase over what it was expecting to pay, although that amount could change.

Charles Lattuca, executive director of the office of transit development for the Maryland Transit Administration, said the state and private team handling the construction are 30 percent done with designing the rail line. “We’re going to go through final design and these costs might go up,” Lattuca said.

This means council members, who have struggled in recent years with rising operating and capital budgets in the county, may face increased Purple Line costs in the future. At the same time, state Transportation Secretary Pete Rahn has trumpeted the $30 million in construction cost savings the state realized in the deal—much of which came from redesigning the Silver Spring Transit Center Purple Line Station.

A rendering provided by Maryland Transit Administration officials Monday showing how the Purple Line station will fit in with the Silver Spring Transit Center and Metro tracks.

Lattuca said the Purple Line wouldn’t have moved forward unless costs were cut from the project. He said Monday was the first time he heard about the council’s desire to “split the difference” between what the state has saved and what the county is paying for.

“We gave the county essentially all the flexibility we have,” Lattuca said.

The county did secure an extended financing deal to pay for the projects over the line’s six-year construction period, county Transportation Director Al Roshdieh said. Rather than have to pay much of it during the first three years of construction, which could have significantly affected the county’s capital budget, officials were able to shift $27 million of the costs from the first three years to the last three years to give officials more time to plan for the costs.

Roshdieh said that most of the state’s estimated $550 million in savings on the $5.6 billion project came from the operations side, which the state will realize over the life of the 36-year agreement with the private partner picked to build and operate the line. The state's Board of Public Works is scheduled to vote on the agreement with Purple Line Transit Partners Wednesday, although this won't force the county to agree to all the financial details, according to Lattuca. He said the state is working on a memorandum of agreement expected to be completed in the next week that will include the financial expectations of the county. The council asked for a draft of that agreement before it's signed and Roshdieh said he didn't have a reason why it couldn't be provided to the council.

The rail line's construction costs are estimated to be $1.99 billion. The state is expected to contribute about $160 million in upfront construction costs, less than Montgomery County’s $169.5 million, but more than Prince George’s County’s $120 million. The rest of the construction costs will be paid for by the federal government and the private partner. The private partner will then be repaid for building, operating and maintaining the line with annual payments of $150 million from the state over the 36-year life of the agreement. Construction is scheduled to begin late this year and be completed by 2022.

There is an additional $400 million in "associated costs" outside of the construction costs that includes off-site environmental mitigation, purchasing of right-of-way, utility work, final design reviews and state construction oversight that's being paid for with a combination of county, state and federal funds, according to the state.

Council members were also displeased that last year they were asked to provide the state with an additional $40 million in cash to make sure the project moved forward. That move was made after Hogan asked Montgomery and Prince George’s counties to contribute a greater share toward the cost of the Purple Line.

“I feel like this project is on a slippery slope and we’re on the wrong side of the slippery slope,” council member Marc Elrich said. “It doesn’t make sense that benefits flow to the state and the burden continues to flow to the county.”

One of the changes to the Bethesda Purple Line station, which state officials described as a benefit, was to redesign the vent systems. The original design included an 80-foot-tall vent tower protruding into Elm Street Park, while the latest design calls for a jet fan placed in the station to ventilate any smoke that could occur.

Lattuca also said the Capital Crescent Trail’s design has not changed, even though its estimated cost has decreased.

“The same trail we promised is the same trail we’re going to deliver,” Lattuca said. He added that they’re working on a rendering of the trail’s design that they plan to complete soon.