The fox and the chickens

By David Broadland, April 2015

Victoria City Council has been fooled again on the Johnson Street Bridge project.

One of the great paradoxes of the Johnson Street Bridge Replacement Project is that as the costs go up and the benefits to taxpayers go down, the company managing the project for the City of Victoria makes more and more money. In a February 27 letter to the City, MMM Group asked for an additional $1.8 million. Although a precise account of MMM’s likely total take on the project is not yet available, the latest ask appears to push it close to $17 million. Yet in 2010 MMM estimated their services would cost $7.8 million. Since then, while MMM’s bill climbed, the project has undergone a continuous paring away of most of the original objectives of the project.

Since mid-2010 the following changes were made: rail service across the bridge was removed from the project scope; the width of the roadway was reduced and the safety zone for bicycles eliminated; the navigational channel was reduced to little more than its current width; the Wilkinson Eyre signature-bridge architectural quality was downgraded to Nanaimo Light Industrial; the material quality of the finished bridge was cheapened to the point where it will now be structurally reliant on 4000 gallons of epoxy grout; and, instead of being removed, the concrete piers of the existing bridge will be left in place, with unknown consequences. Will the narrow, unbraced concrete remnants fall into the navigational channel in an earthquake, and block it, hindering recovery?   

Even with all those reductions in scope, the overall cost of the project rose from $63 million in early 2010 to $92.8 million in 2012, and has since risen to between $113 million and $120 million today, when claims for more money from the various companies involved in the project are included. The City is in a “mediation” process involving all the parties asking for more money and would, naturally, prefer that everyone believe these claims are all just a big put-on and will vaporize into a cloud of goodwill between the builder of the bridge (PCL) and MMM, who are, right now, at each others’ throats.

likely costs of new JSB

The latest loss in scope, which I wrote about last month, is the level of seismic performance MMM recommended to the City in 2010. Back then, MMM’s Joost Meyboom told City councillors the new bridge should be built to a “Lifeline” standard that would enable immediate access to emergency vehicles following an “M8.5” earthquake (read “magnitude 8.5”). Meyboom said that, compared to an “M7.5” earthquake, “M8.5” protection would cost an additional “$8.5 million.” Councillors then voted to include the “M8.5” standard in the project, and that level of seismic performance was widely promoted by the City during the referendum campaign. In fact, days before the referendum, Meyboom emailed City staff pointing out that a new study about the Cascadia subduction zone west of Vancouver Island suggested the zone could produce an M9.0 earthquake and so the City might want to consider—for more money—an even higher level of seismic protection.

But last month I revealed here that an August, 2012 document authored by MMM showed it had secretly lowered the standard. The document, titled Johnson Street Bridge Seismic Design Criteria, stated that the bridge could experience “possible permanent loss of service” following an M7.5 earthquake. Just as surprising was the fact the document included no commentary whatever on the level of damage expected following a M8.5 earthquake, or whether emergency vehicles would be able to use the bridge following such a quake—a feature City councillors thought they had bought back in 2010.

My article prompted a 50-minute back-and-forth discussion between City councillors and the project’s latest director, Jonathan Huggett, at a March 12 meeting.

Huggett referred to MMM’s seismic design criteria only once at the meeting and then only refered to it as “a memo,” even though the document is listed in the construction contract for the project as a “Regulatory Document” that “forms part of the contract.” He avoided the contents of the document and instead expressed doubt that there would be any incentive to lower the seismic design criteria. “What would be the motive to reduce the design standard?” Huggett asked councillors. “Hardesty and Hanover are not responsible for the construction costs of this bridge. They designed it. So if it turns out it costs more money, it’s not their problem. And PCL didn’t design the bridge and they have a contract to build the bridge and they’ll build whatever they’re told to build. So I’m at a loss to understand who might have suggested reducing the standard and what possible advantage they would have got out of it.”

As Huggett must have known, however, the contents of MMM’s document wouldn’t have had any input from either PCL or Hardesty and Hanover—it was written solely by MMM in August, 2012. MMM’s position at that time is easily understood. The company was trying to save the project. Before MMM published its seismic design criteria, all three companies bidding for the construction contract had indicated they couldn’t build MMM’s design on the City’s $66 million budget. MMM’s challenge was to find some way to lower those bids.

Lowering the seismic standard for the project would have had exactly the same effect—increasing the likelihood that the project could proceed—as, say, advising the City to accept a bid that had only a four-percent contingency.

Let me parse this point a bit, because it provides guidance on MMM’s credibility on the seismic issue. Why did MMM recommend that the City accept a bid with a  four-percent contingency? Was it because MMM thought that was adequate? No. (I’ll provide proof for this later.) It was done to ensure that at least one bid was within the City’s affordability ceiling (The other two bids ended up $16 milllion and $26 million above the City’s budget). Otherwise the project likely would have been dead, and if it had died the City would not have signed—in November, 2012—a $9.2 million contract with MMM for additional project management and engineering. 

Recommending that very small contingency, though, isn’t the only proof that MMM were changing primary aspects of the project during the procurement process in 2012 to keep the project alive. Throughout the fall of 2012 they negotiated an agreement with Transport Canada to remove a significant cost from the project’s scope: removal of the existing bridge’s concrete piers. Although the only claim made for leaving the piers in place has been that they would provide “marine habitat,” an email from an MMM employee obtained by FOI shows that the move to leave the piers in place was done to reduce the scope of the project while the RFP was still open, in the hope of “maintaining a commercially competitive environment.” The takeaway from that is that MMM were actively reducing the scope in the hope of obtaining a viable bid.

So MMM had a financial motive to save the project by reducing the physical scope, they engaged in that across a broad front, and this appears to have included lowering the seismic performance.

Huggett, at the meeting, unable to see a motive, noted that the bridge had been designed using the most stringent codes. He spent much time listing these codes, but had apparently not noticed that MMM’s Seismic Design Criteria prominently stated that the provisions of all those codes were secondary to the stipulations of its own document.

Although most of the councillors at the March 12 meeting readily accepted Huggett’s claim that there was nothing to be concerned about, Councillor Ben Isitt asked that MMM’s Johnson Street Bridge Seismic Design Criteria be projected on an overhead screen above the Council chambers. (Unbelievably, this had to be retrieved from Focus’ website.) When confronted with the actual document that was at the core of the issue, Huggett had no explanation. In a quick reversal of their earlier warm reception of Huggett’s comforting assurances, councillors passed Isitt’s motion asking Huggett to report back to them on why what he was telling them was at odds with what MMM’s Seismic Design Criteria stated.

In an unusual motion, Huggett was directed by council to meet with me and answer questions I might have. But in the days that followed, Huggett declined to meet and refused to answer questions posed to him by email, stating that he would hold a technical briefing for all media once he had responded to the council’s request for an explanation. As this edition went to press, that technical briefing hadn’t taken place.

Instead, Huggett sought an explanation from MMM, and on March 20 MMM responded by letter to Huggett. That letter was then made public. In part, it stated, “With respect to the bridge performance after a 2500-year return period seismic event, we wish to clarify that the 2500-year event is not part of the seismic design criteria specified in the JSB 2012 [Project Definition Report] and was not analyzed in the design.”

That requires a little interpretation. A “2500-year return period seismic event” in Victoria has a rough equivalence to an earthquake with a magnitude of M8.5. That equivalence, in regards to this project, has been stated in writing by both MMM and Stantec.

So MMM’s letter admitted that it could provide no documented evidence that engineers had considered what would happen to the bridge in an M8.5 earthquake. (It should be noted that in its critical review of MMM’s design, Kiewit Infrastructure’s engineers, who prepared a bid for the construction contract, rejected the mechanical concept, and instead proposed a design in which the moveable part of the bridge was firmly attached to the supporting bascule pier. Those engineers noted, “This method reduces seismic, mechanical and maintenance related technical challenges in the design.”)

Huggett apparently had some doubt about MMM’s admission of having conducted no analyses for a 2500-year earthquake, because he then wrote back to MMM asking for an explanation. MMM responded with a second letter which boiled down to this: because the bridge has been classified, on paper, as a “critical bridge,” there is an “inference” that “it is expected to be available for use by emergency and security/defense vehicles immediately following a 1:2500 year earthquake.” MMM’s letter continued on to state: “…it is not necessary (or required) to actually analyze the structure for a 1:2500 year earthquake for us to be able to confidently state that the JSB will be available for use by emergency and security/defense vehicles following a large earthquake.”

Armed with these two letters, Huggett then made a presentation to councillors on the issue at a meeting on March 26. I’ll come back to that meeting later, but first I’d like to pose some questions that naturally arise from this situation, questions for which councillors serious about representing the public interest would want answers.

First off, MMM is saying that they didn’t do an M8.5 analysis because they have written on paper that  the bridge is a “Critical Bridge” and that, by definition, there is an “inference” that a “Critical Bridge” would provide the performance City council requested in 2010. But wouldn’t councillors ask themselves, “Since MMM cannot provide an actual set of seismic analyses for an M8.5 earthquake, why should I believe their assertion? Has the information they have provided me in the past been credible?”

On the issue of credibility, MMM’s record is concerning. Let’s go back to the contingency issue as an example. When councillors were asked to approve a $66 million construction contract with PCL in December 2012, they were told: “The City’s Consultant, MMM Group, has reviewed the contract documents prepared by [the City’s legal  advisor] and the City, including optimizations, contingency, project risks and the value engineering opportunities, and in their professional opinion recommend that the City proceed with the project and enter into a contract with PCL Westcoast.”

That “recommended” contingency amounted to four percent. Then, in March 2014, after PCL had submitted a change order requesting an additional $9.5 million ($7.9 million net) as a result of delays and costs they attributed to MMM, MMM’s Joost Meyboom, in a letter to the City, stated that the design PCL submitted to the City in its bid was “at best 10 percent complete.” Meyboom then observed,“We note that it is not unreasonable for scope to vary by 30 percent from a 10 percent design and that this is normally accounted for with appropriate contingency.” So MMM first recommended that the City accept  a four percent contingency, and then later, when it suited their purpose, suggested that it should have been 30 percent.

Should councillors now trust MMM? Is its recent claim that the bridge will allow emergency vehicle access after an M8.5 earthquake to be trusted? Or should councillors trust what MMM said when it claimed there could be “permanent loss of service” following an M7.5 earthquake, which is the claim that’s included in the construction contract? 

The second question is this: We live in a region of high seismic hazard. What is the normal requirement for conducting seismic assessments, when designing significant public infrastructure for our region? For guidance on this, councillors might want to look to the Port Mann Bridge Project in Vancouver. It has been built in an area that is considered to have a significantly lower level of seismic hazard than Victoria. Yet for that project the Province required four separate seismic analyses for the 2500-year return period earthquake—including a “damage assessment analysis.” Although both the Port Mann Bridge and the Johnson Street Bridge have the same “Lifeline Structure” designations, the Port Mann Project did four analyses, the Johnson Street Bridge Project did none. Councillors, no doubt, would want to know: Why weren’t these four analyses done for Victoria’s bridge?

The third question is whether a set of 2500-year analyses would have represented significant additional cost or not. The only significant variables in such analyses are all related to the structure of the bridge itself. Those variables were all determined for the 1000-year analysis. Since these variables wouldn’t change between a 1000-year analysis and a 2500-year analysis—its the same bridge in each analysis—why would there be any significant cost to running both sets of analyses? Wouldn’t councillors want to know how much it would cost an engineer to enter a different value for spectral acceleration and then push the “analyze” button on the computer program? Since pushing the 2500-year button seems to be the normal practice in southwestern BC—witness the Port Mann Bridge Project—did the seismic engineers, in fact, push the button and later say they didn’t because they didn’t like what they found?

By the way, the physical difference between a 1000-year event, for which MMM claims an analysis has been done, and a 2500-year event—which MMM admits it didn’t do—is very large. Last month I reported here that the energy released in the 2500-year event was 10 times that of a 1000-year event. That was incorrect. According to the US Geological Survey, an M8.5 earthquake releases 31.6 times as much energy as a M7.5 earthquake. Given that MMM’s Seismic Design Criteria state that the bridge could sustain “possible permanent loss of service” in an M7.5 earthquake, what would happen to it in an earthquake that was 31 times more energetic? Surely, councillors would want to know that, wouldn’t they?

Although Huggett’s initial response to the issue was to tell councillors they didn’t need to be concerned because everything was being done according to code, at least having MMM’s letters in hand demonstrated that he did follow council’s direction to find an explanation for the discrepancy between his position that there was nothing to be concerned about and the actual stipulations of MMM’s Seismic Design Criteria. If I were a councillor, though, I would want to know if Huggett, as a paid representative of the chickens, went to anyone other than the fox for an opinion on whether the fox was having the chickens for lunch.

So how did councillors do?

On March 26, Huggett gave City council an update on the project’s escalating costs. I have written about these cost escalations in detail in previous stories and there’s nothing new on that front except that costs have gone up by an additional $4.8 million. Following Huggett’s presentation, Councillor Isitt noted that the project was “a disaster” and said, “I do have grave concern’s about MMM’s performance.” When Isitt asked Huggett whether MMM could be replaced as project manager, Huggett told councillors that the one MMM employee working on the job site was putting in long hours and said MMM “was doing a good job.” Councillors’ refusal to approve the full $4.8 million requested by Huggett amounted to closing the chicken coop door after the hens had already been eaten by the fox. Although councillors still refuse to acknowledge that the current cost of the project to City taxpayers is in the range of $113 million to $120 million, councillors being out of touch with reality on this project isn’t news.

The escalation update was followed by a long in camera meeting on the City’s legal difficulties with MMM and PCL. Claims that the City is in mediation with the various parties have been made for several months now, and that has been useful to City staff in preventing councillors from asking, in public, substantive questions about the project’s woes. Ostensibly this muzzle has been put on councillors to protect the City’s position in any legal action that might occur if mediation fails. At the same time, though, it prevents public discussion of who at City Hall is responsible for decisions made that seem to have left the City without any case for pursuing legal action against their project manager, including holding MMM to account for its verbal recommendation to the City on the four percent contingency in the contract with PCL. The record of several closed meetings on this project, obtained by FOI, shows that advice given to councillors by City staff at these hidden-from-the-public-eye meetings has usually led to decisions that later turned out to be based on misinformation. 

Following the March 26 closed meeting, Huggett presented his report on the seismic issue to councillors. It was short and to the point. Huggett blamed the issue on those raising it, calling media reports on the issue “irresponsible.” He invoked MMM’s two letters as proof there was nothing for councillors to be concerned about and expressed dismay over the amount of time he’d spent not answering questions. Only Councillor Isitt asked anything close to a substantial question, but he, evidently, didn’t comprehend that Huggett hadn’t provided him a substantial answer.

What seemed evident to this observer is that the fox has now infiltrated the chicken house, and the chickens can’t tell the difference between a rooster and a fox.

David Broadland is the publisher of Focus Magazine.