The Santa Clara Valley Transportation Authority (VTA) BART Silicon Valley Phase II staff will recommend to the Oversight Committee on June 12 that VTA pursue a new tunnel contractor to align costs with the project budget. This move is part of a strategic effort to control costs and keep the project on a financially sustainable path.
“VTA staff have identified approximately $400 million in potential cost savings through a comprehensive review of the project. By taking a holistic approach, the team pinpointed opportunities to refine the design, streamline construction methods, and optimize project delivery, demonstrating VTA’s commitment to fiscal responsibility and efficient use of public funds,” explains Sergio Lopez, Mayor of Campbell and Chair, VTA Board of Directors.
Current contractor Kiewit Shea Traylor (KST) was unable to meet budget expectations and VTA staff believe a new procurement should be considered to find savings and avoid cost increases associated with KST’s price proposal for the tunnel work.
Through confidential discussions, multiple nationally recognized tunneling contractors affirmed their strong interest in partnering with VTA to deliver a technically sound, efficient tunnel solution. These firms expressed confidence in their ability to meet the project’s engineering requirements while aligning with VTA’s budget framework, reinforcing the agency’s strategy to control costs without compromising on quality or safety.
This recommendation is the first in a series of cost savings measures being evaluated by VTA staff for consideration of the Board in the coming months.
“While it is never easy to part ways with a contractor, I strongly support VTA’s effort to find efficiencies and control costs to move this once in a generation project forward. We don’t have a blank check for this project, and it’s important that everyone—from the agency to its contractors—is held accountable for staying within budget,” said San Jose Mayor Matt Mahan, Vice Chair, VTA Board of Directors.
The off-ramping decision and new procurement may extend the timeline, VTA remains committed to exploring cost-saving opportunities to ensure the program stays within available funding.
Through staff’s preliminary industry outreach, we believe that a new tunnel contract package will align better with price estimates and maintain long-term viability of the program.
KST will complete the early BART to Silicon Valley construction activities that the company initiated, which includes building the portal for the future tunnel work.
The VTA is proud of our more than 20-year track record of delivering project on time and on budget. The tunneling contract recommendation is aimed at doing exactly that for the BART to Silicon Valley program.