Roads contract worth $43 million OK’d by board

BOISE – State transportation officials have authorized a contract worth as much as $43 million over three years with Washington Group International and CH2M Hill for management and engineering services on the $1.2 billion “Connecting Idaho” road-building plan.

Idaho is outsourcing the work because Transportation Department Director Dave Ekern said it couldn’t be done with his existing staff and budget.

Still, Frank Bruneel, chairman of the Transportation Board that oversees the agency, said Monday he wants state engineers to do as much as possible themselves to keep costs below the contract’s limit.

Bruneel was named by Gov. Jim Risch in June to replace ousted Chairman Chuck Winder, who was one of the chief advocates of the plan to sell bonds to pay for highway improvements quickly, then repay them with future federal highway funding.

“That would be very disappointing to me if we spent that kind of money,” Bruneel said. “We have manpower to provide a lot of these services, and it’ll be the board’s policy and intention to do those things in-house where we have the resources available.”

The Idaho Transportation Board voted 4-2 Friday to authorize the contract.

State lawyers are now reviewing it for final signing within two weeks.

“Connecting Idaho” includes $200 million worth of projects scheduled through 2007, such as work on U.S. Highway 95 in North Idaho, Interstate 84 near Meridian and U.S. Highway 30 near Soda Springs. Since its introduction, however, it’s been controversial.

First, it was scaled back by the 2005 Legislature.

Then in January, the Transportation Board had to redo the initial contract with Boise-based Washington Group and Denver’s CH2M Hill because Federal Highway Administration officials said it was improperly awarded, based on the companies’ local ties.

And lawmakers in the 2006 Legislature further trimmed initial projects to just six, from a proposed 11.

Transportation Department officials hailed last week’s authorization as a big step forward. Since contract talks started earlier this year, Washington Group and CH2M Hill have been providing services under a stopgap agreement worth about $900,000.

“This innovative project is the first of its kind in Idaho and a major step in delivering much-needed improvements to our highways now, rather than 10 years from now,” Ekern said in a statement.

Under the contract, which includes targets that could boost or decrease profit, as much as $25.1 million covers engineering services. That includes $3.1 million in profit that was negotiated in advance, said Transportation spokesman Jeff Stratten. Such “negotiated profit” is common in such contracts, he said. As much as $17.9 million covers management services, including $2.9 million in negotiated profit, he said.

On Monday, lawmakers on the Joint Finance-Appropriations Committee who approved funding for “Connecting Idaho” hadn’t yet seen the contract’s details. Still, some on the budget-writing panel were at least initially surprised by the amount – especially after they’d trimmed the road-building effort to six projects through 2007.

“I had hoped they would have been taking a close look at the cost of the program management contract, given the project list was smaller than originally proposed,” said Sen. Shawn Keough, R-Sandpoint.