The Municipality of Anchorage has hired engineering and construction company CH2M Hill to oversee the troubled Port of Anchorage Intermodal Expansion Project. If the company's name sounds familiar, it should: The city is currently embroiled in a lawsuit with CH2M Hill over work already done on the port. Mayor Dan Sullivan insisted at a Thursday press conference at City Hall that the legal dispute will not affect the city's work with CH2M Hill going forward.
The project management award would pay CH2M Hill $30 million over five years, with the option of two two-year extensions for $12 million each. The money would pay for CH2M Hill's management of the effort to repair old work already done at the port and continue the proposed expansion project, which has already cost hundreds of millions of dollars. The Anchorage Assembly needs to approve the contract at its Jan. 14 meeting, before the contract become official. But -- per city purchasing rules -- the details of the contract will not be made available to the public until after the Assembly's approval.
In September of 2007, CH2M Hill purchased the Alaska assets of VECO Corp. -- the former oilfield services company headed by disgraced president Bill Allen. Allen was convicted for trying to bribe Alaska lawmakers during the oil tax debate in 2006. His company, VECO, was instrumental in approving what was then an untried method of adding more land to the Port's north end. The open-cell sheet piling essential to the plan -- metal sheets that were driven into the Cook Inlet silt -- are at the center of years of failures during previous construction attempts. Much of that work has to be undone, according to current port officials, because the pilings are failing in some spots and are being undercut by Cook Inlet's strong currents.
When CH2M Hill acquired VECO, it inherited the port work VECO had done, and the subsequent lawsuit -- filed in U.S. District court in March 2013. But neither the company nor Sullivan believes the current court fight will affect the working relationship between the two entities.
"We believe we can compartmentalize the lawsuit and will be able to keep it separate as we move forward with the project," Sullivan said.
CH2M Hill will oversee the project management, but all port decisions will still ultimately be made by the city, the mayor said.
The Maritime Administration -- a little-known arm of the U.S. Department of Transportation – was in charge of the port project until 2012. A DOT inspector general's report made public in August of 2013 took MARAD to task for failing to properly oversee the port expansion work and attributed much of the cost overruns and faulty design to the agency. Sullivan said CH2M Hill won't make the same mistakes as MARAD.
"They will have people located at the port, which MARAD never did," said Sullivan.
The city has about $130 million available for future port work, but the scope and size of that work has yet to be determined. The city must first select an engineering design firm to go over proposed alternatives and set a final design. The mayor said that process could take between 18 and 24 months and that he doesn't expect to see any dirt turned there until at least 2016. But that date remains a moving target.
"I don't want to throw a dart and tell you a year," the mayor said. "We will have to wait and see what the ultimate project scope is."
Contact Sean Doogan at sean(at)alaskadispatch.com