Capitol Visitor Center: Update on Status of Project's Schedule
and Cost as of February 7, 2008 (07-FEB-08, GAO-08-475T).
Today's remarks are based on our review of schedules and
financial reports for the CVC project and related records
maintained by AOC and its construction management contractor,
Gilbane Building Company; our observations on the progress of
work at the CVC construction site; and our discussions with the
CVC team (AOC and its major CVC contractors), AOC's Chief Fire
Marshal, and representatives from the U.S. Capitol Police. We
also reviewed AOC's construction management contractor's periodic
schedule assessments, potential change order log, and weekly
reports on construction progress. In addition, we reviewed the
contract modifications made to date.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-08-475T
ACCNO: A80568
TITLE: Capitol Visitor Center: Update on Status of Project's
Schedule and Cost as of February 7, 2008
DATE: 02/07/2008
SUBJECT: Accountability
Construction contracts
Contract administration
Contract modifications
Cost analysis
Cost overruns
Facility construction
Federal facilities
Federal funds
Future budget projections
Public visitor-centers
Risk assessment
Schedule slippages
Strategic planning
Cost estimates
Capitol Visitor Center Project
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GAO-08-475T
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United States Government Accountability Office:
GAO:
Testimony:
Before the Subcommittee on the Legislative Branch, Committee on
Appropriations, House of Representatives:
For Release on Delivery:
Expected at 10:00 a.m. EST:
Thursday, February 7, 2008:
Capitol Visitor Center:
Update on Status of Project's Schedule and Cost as of February 7, 2008:
Statement of Terrell G. Dorn:
Director, Physical Infrastructure Issues:
GAO-08-475T:
Madam Chair and Members of the Subcommittee:
I appreciate the opportunity to be here today to assist the
Subcommittee in monitoring progress on the Capitol Visitor Center (CVC)
project. My remarks will focus on (1) the Architect of the Capitol's
(AOC) construction progress since the last CVC hearing on November 14,
2007,[Footnote 1] and (2) the project's expected cost at completion and
funding status.
Today's remarks are based on our review of schedules and financial
reports for the CVC project and related records maintained by AOC and
its construction management contractor, Gilbane Building Company; our
observations on the progress of work at the CVC construction site; and
our discussions with the CVC team (AOC and its major CVC contractors),
AOC's Chief Fire Marshal, and representatives from the U.S. Capitol
Police. We also reviewed AOC's construction management contractor's
periodic schedule assessments, potential change order log, and weekly
reports on construction progress. In addition, we reviewed the contract
modifications made to date.
Summary:
Since the November 14, 2007, CVC hearing, the project's construction
has progressed, and AOC is still anticipating an early November 2008
opening date. But risks to the project's schedule remain in several
time-critical activities, especially fire alarm acceptance testing,
which, under the current schedule, must be completed on time for the
CVC to open on time. Delays in work on the East Front, the Exhibit
Gallery, and the House Hearing Room also pose risks to the project's
schedule, as do the many items on the project's punch list and a steady
number of proposed change orders. At this time, however, AOC does not
expect the punch list items or the proposed change orders to affect the
project's completion date.
AOC's current estimate of the cost to complete the CVC project's
construction, first reported at the September 25, 2007, hearing, is
about $621 million. We believe this estimate is reasonable, provided
there are no unusual delays. To date, about $566.2 million has been
approved for CVC construction, and AOC has $16.2 million more in fiscal
year 2008 CVC appropriations that it plans to use for construction
after it obtains congressional approval to obligate these
funds.[Footnote 2] AOC has estimated that it will need an additional
$5.9 million in fiscal year 2008 to fund construction, and it has
requested $31.1 million in fiscal year 2009 funds for CVC construction.
Based on its current cost-to-complete estimate, AOC believes it may
need an additional $2 million to complete the project in fiscal year
2009.
Construction Is Nearly Complete, but Risks Remain:
According to AOC's construction management contractor, in dollar terms,
the overall CVC project is 99 percent complete,[Footnote 3] as compared
with 98 percent reported at the November 2007 CVC hearing. Yet even at
this late stage in the construction process, delays in a number of
time-critical activities related to the fire alarm system pose risks to
the project's schedule.
Work on the project's current critical path,[Footnote 4] fire alarm
acceptance testing, is underway and is within a week of being on
schedule. Since the last CVC hearing, delays have occurred in this
activity because of required changes in the fire alarm system's planned
sequence of operations. However, prompt attention by the CVC team
reduced the time lost to 3 days and AOC still expects the CVC to be
ready to open on November 3, 2008. Moreover, the opening could be
sooner if AOC reduced the amount of fire alarm acceptance testing
required, as AOC's consultants have suggested. Nonetheless, AOC's fire
marshal has determined that the fire alarm acceptance testing will
proceed as planned.
Delays in less time-critical areas such as the East Front, the Exhibit
Gallery and the House Hearing Room also continued. For example, in the
East Front Upper Levels, the planned work schedule slipped by 4 weeks
after AOC determined that additional sprinkler heads would be needed
and other design changes were required. Work in the Exhibit Gallery was
delayed by 3 weeks when AOC did not receive replacement pieces for the
glass floor as scheduled.
Delays in addressing items on the project's extensive punch list pose a
further risk to the CVC's schedule and call for continued prompt
attention by AOC and its contractors. For example, work in the Exhibit
Gallery may fall behind schedule while AOC and its design team address
deficiencies in the Wall of Aspirations, which failed a test of its
fire protection system. In addition, damage to pavers on the East Front
plaza has not been repaired, and extensive work may be required to
prevent further damage. Efforts to relocate PEPCO electrical vaults,
which are too high for the current landscaping plan, are still
unresolved and may delay completion of the work in that area by 5
months.
Proposed change orders continue to pose risks to the project's schedule
and to be identified by the CVC team each month. AOC and its
contractors have continued to work together to reduce the number of
open (outstanding) proposed change orders, but the number of open
orders has remained essentially unchanged. Sustained attention to this
issue is needed to reduce uncertainty about the project's costs and to
avoid risks to the project's schedule as new proposed change orders
come in. Figure 1 compares the number of outstanding proposed change
orders with the number settled each month.
Figure 1: Outstanding and Settled Proposed Change Orders by Month,
March 2006 through December 2007:
[See PDF for image]
This figure is a multiple line graph illustrating the Outstanding and
Settled Proposed Change Orders by Month, March 2006 through December
2007. The vertical axis of the graph represents number from 0 to 500.
The horizontal axis of the graph represents monthly dates from March
31, 2006 to December 31, 2007. Lines depict the following change
orders:
Outstanding PCOs: between approximately 380 on March 31, 2006 and
approximately 450 on December 31, 2007;
PCOs settled this month: approximately 40-60 per month.
Source: AOC's construction management contractor.
[End of figure]
AOC's Cost Estimate Remains the Same, and Additional Funds Will Be
Needed:
In September 2007, AOC increased its estimate of the cost to complete
the CVC project's construction to about $621million, which remains
unchanged. The $621 million estimate includes, among other things,
contingency amounts for delays, change orders, and remaining
uncertainties related to the project's fire alarm testing.
To date, about $566.2 million has been approved for CVC construction,
and AOC has $16.2 million more in fiscal year 2008 CVC appropriations
that it plans to use for construction after it obtains congressional
approval to obligate these funds. AOC has estimated that it will need
an additional $5.9 million in fiscal year 2008 to fund construction,
and it has requested $31.1 million in fiscal year 2009 CVC
appropriations for construction. Based on its current cost-to-complete
estimate, AOC believes it may need an additional $2 million to complete
the project in fiscal year 2009.
Madam Chair, this completes my prepared statement. I would be pleased
to answer any questions that you or Members of the Subcommittee may
have.
Contacts and Acknowledgments:
For further information about this testimony, please contact Terrell
Dorn at (202) 512-6923. Other key contributors to this testimony
include Shirley Abel, Lindsay Bach, Maria Edelstein, Elizabeth
Eisenstadt, Jeanette Franzel, Jackie Hamilton, Bradley James, David
Merrill, and Joshua Ormond.
[End of section]
Footnotes:
[1] GAO, Capitol Visitor Center: Update on Status of Project's Schedule
and Cost as of October 31, 2007, GAO-08-227T (Washington, D.C.: Nov.
14, 2007).
[2] For fiscal year 2008, AOC received $28,753,000 (before rescission)
in appropriations for the CVC project. Pub. L. No. 110-161. Of that
amount, AOC is allowed, but not required, to use up to $8.5 million for
operations. AOC is currently planning to use the $8.5 million for
operations.
[3] In other words, the sequence 2 contractor has received about 99
percent of the current contract value. This value does not include the
costs of unsettled proposed change orders, potential claims, and work
performed outside the current contract, such as the fire marshal's fire
alarm acceptance testing.
[4] The critical path is the single longest path of activities through
a project's schedule. Each day of delay in the critical path could
delay the completion of the entire project.
[End of section]
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