SFMTA Audit Spotlights Poor Project Management, Cost Overruns

The T-Third Street Light Rail project's Central Subway extension has nearly tripled from its baseline cost. Photo: ##http://www.flickr.com/photos/mwichary/3625652092/sizes/m/in/photostream/##Marcin Wichary/Flickr##

The San Francisco Municipal Transportation Agency (SFMTA) received a low score in an audit of its performance in delivering construction projects. Millions are reportedly wasted annually in delays and management inefficiencies.

“Some of these findings are very disturbing,” said Supervisor David Campos after hearing the report at today’s San Francisco County Transportation Authority (SFCTA) Board meeting. “We have heard repeatedly how there are limited resources that the MTA has available, but this audit points out… that a big part of the problem is that we’re not doing enough with the resources we do have.”

As the SFMTA seeks new revenue sources to fill budget gaps for the coming fiscal years, it is considering unpopular fee increases like a hike in Muni fares, which was quickly taken off the table by the SFMTA Board of Directors yesterday.

The SFCTA Board, which approves much of the funding for the SFMTA’s capital projects, requested the audit from CGR Management Consultants.

The numbers reported were sobering. In the third quarter of 2010, 29 projects with a total baseline budget of $800 million had gone over-budget by an estimated $90 million, excluding the Central Subway, and averaged 592 days in delay.

The consultants estimated that 5 to 10 percent, or up to $15,000,000, of the SFMTA’s capital budget could be saved with better project execution. Among the causes for waste, they listed weak oversight of capital projects, inadequate staff reports to the SFMTA Board of Directors, and the board’s own leniency towards granting extra time and money to projects.

“What we found, in reporting to the SFMTA Board, and their own monitoring, is that they compare themselves to the approved budget, not the baseline budget,” said CGR Principal Jim Ayers. “They ought to be using [the baseline] as a benchmark for showing how well or not well they’re doing.”

The SFMTA officially “concurred” with 17 of the recommendations provided by the consulting firm and “partially concurred” with two. One of the recommendations that met with “partial” agreement concerned a reorganization of staff which SFMTA Director of Transportation Ed Reiskin said would hurt the agency’s flexibility. The other suggested using public affairs specialists to hold community outreach meetings rather than SFMTA staff, who are paid a higher premium.

“I believe it’s important that [the project managers] make the time available to spend engaging, to go to community meetings to understand what the concerns are, because ultimately, that person is going to be held accountable,” said Reiskin.

Reiskin also rebuffed some of the numbers in the report, arguing that some items categorized as “overruns” were actually project expansions, as in the case of the ongoing Duboce and Church rail replacement and streetscape project.

Still, the new transportation chief welcomed the audit as a guide for reform.

“It’s a great thing,” said Reiskin. “I’d be lying if I said we in departments love when folks come in and audit us, but often the results can be very helpful.”

  •  so what is actually being done to make it profitable after seeing the audits.

  • Chattancho

    nothing.  nothing at all.  sfmta sees it as free money because it does not affect their pay.

  • ben

    having sfmta overseeing this project is like the wolf guarding the hen house.  sfmta has a habit of hiding things until they get caught.  then they start to back track.  this whole central subway is a big waste of $$$$$.  the cost in excess of $1m/per mile!!!!!???   are you serious?  how bout asking mgmt why nothing is being done about fixing busses? 

    fyi  the makers of these busses both diesel & trolleys have gone out of business and they never bought extended warranties till a few months ago.  SMART  VERY SMART

  • Guest

    There is not a profitable transit agency in the U.S.

  • jayhl77

    “$1m/per mile”?  I wish!  Try almost $1 BILLION per mile!

  • guest

    SF MUNI has always been poorly managed. Instead of wasting money with these projects, why not just buy new buses for the riders! They could care less about buses and think rail is more importation.

  • Anonymous

    If it’s well-designed and well-run (a tall order, I know), rail is a lot cheaper to run than buses are, especially on routes with heavy traffic.

  • Cautn1

    Central Subway – What’s New?

    For one thing, “Chinatown’s Subway” is, as expected, spawning a speculative bubble along Fourth Street.  Needless to add this is of interest to the benefiting         
    south-of-market developers, convention goers, art patrons and high-end Union Square shoppers.  However with its anemic future ridership and two poorly-located, north-of-Market deep stations, the Central Subway does virtually nothing for Chinatown and even less for the rest of San Francisco.  According to the SFMTA only 10.5% of those currently riding Muni Lines 8x, 30 and 45 along Stockton will bother to use the Chinatown Station.  That speaks volumes.  It says that the SFMTA’s $1.58 billion short subway won’t attract even today’s beleaguered bus riders.

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