Delays and higher-than-expected costs have dragged on in the taxpayer-funded, investor-financed Pennsylvania Rapid Bridge Replacement Project.
The bridge program was planned by the Assembly with input from a long list of investment bankers, Wall Street and international investors, and Pennsylvania lawyers and financial advisers, and rolled out by Gov. Tom Corbett’s administration in early 2015. It was supposed to have “substantially completed” 558 replacement bridges carrying state roads across Pennsylvania creeks as of Sunday.
About 390 of the bridges are open, according to the partnership, and 284 of those have been approved for long-term maintenance payments over the next 25 years by Walsh Infrastructure Management, an affiliate of construction partner and investor Walsh Construction Co. of Chicago.
That leaves 168 bridges, or 30 percent of the total, unbuilt after the target date. Locally, those include the Lincoln Highway bridge over Queen Anne Creek in Falls Township, the Wynnewood Road bridge over Indian Creek in Narberth, the Route 420 bridge over Stoney Creek in Ridley Township, and others that are supposed to be done in 2018. Now slated for early 2019 are spans including a Philmont Avenue bridge in Lower Moreland. (Update Jan. 2, 2018: Walsh spokesman Rory McGlasson tells me the company hopes to speed up the Philmont Ave. bridge and get it done this year.)
The work was budgeted at $899 million, plus financing, consultant, and maintenance fees that raised the total to $1.12 billion. In 2015, Pennsylvania sold more than $700 million in tax-protected Private Activity Bonds to fund the bridges, and pledged an additional $225 million from PennDot funds.
Those bonds tend to cost more than plain-vanilla state bonds. When I asked PennDot officials about the extra expense in 2014, they assured me they would save so much time doing the job this way, instead of bidding the bridges one by one or in small clusters and funding with low-cost state bonds, that the convenience was worth any higher interest expense, as I wrote at the time.
Investors led by Plenary Group of Australia, Wall Street investment banks J.P. Morgan Securities and Wells Fargo Securities, accountant KPMG, Philadelphia-based bond-advisory firm Public Financial Management, lawyers Ballard Spahr and Allen & Overy, and other Wall Street and Pennsylvania professionals were paid to speed the job along under the leadership of Walsh and California-based Granite Construction Co.
The Rapid Bridge Replacement Project was hailed by proponents as an innovative way to build a lot of bridges fast. So why are so many of the bridges still not built?
As it turns out, whatever the financing speed or mass-design efficiencies, each bridge is still a local project.
“As we went through it, there were all kinds of scheduling issues, things like coordinating with utilities to move utility lines, getting environmental permits. We had to adjust the contract to reflect that the schedule was slipping somewhat,” said Rich Kirkpatrick, spokesman for the Pennsylvania Department of Transportation.
Along with the delays, PennDot has had to take on $43 million in additional costs for the bridge replacement, Kirkpatrick added. “That came out of the Motor License Fund,” he told me. That fund, which is supposed to finance road repairs, has also been used for decades to fund state police service to towns that don’t pay for their own.
The Walsh firm is a partner in another large Pennsylvania project, the $400 million Phoenix state prison in Montgomery County, which is going into its third year of completion delays amid a multimillion-dollar fee dispute with the state Department of General Services. DGS says those builders are contractually obligated to pay for their delays.
Officials of bridge team Plenary Walsh Keystone Partners, who issued a short written annual update on construction progress Thursday, weren’t available when I called them Friday seeking answers to some of the questions PennDot couldn’t immediately address.
“We have a lot to be proud of on this historic project,” Ed Dice, head of delivery for the construction group, said in the statement. Plenary Walsh “demonstrated its ongoing commitment to excellence this past year,” he added, using more than 500 subcontractors to complete 218 of the bridges, with the rest still on the planning boards.