Increased Cost Efficiency a Focus for Phase 2 of Second Ave Subway Construction
Hoping to shed the resulting reputation of Phase 1 construction of the Second Avenue Subway line as a project characterized by mismanagement and bloating spending, the Metropolitan Transportation Authority (MTA) “is incorporating cost-saving lessons learned” as the agency embarks on the 2nd phase of expansion. The $4.5 billion cost of extending the Q-Line 1.8 miles from East 63rd Street to East 96th Street with new stops at 72nd Street, 86th Street and 96th Street earned the Second Avenue Subway the title as “the world’s most expensive subway line.” One of the key changes enabling the MTA to reduce costs of the construction of the 1.5-mile extension north to East 125th Street is the planned reuse of a 1970s tunnel that sits vacant following an earlier failed attempt to build the subway line. Extending from 110th Street to 120th Street along Second Avenue, by reactivating the tunnel instead of building from scratch, the MTA will save an estimated $500 million. In addition, planned new stations at 106th Street, 116th Street, and 125th Street and Lexington Avenue will be reduced in size by consolidating back rooms for operations, which were “dramatically overbuilt” in Phase 1, or moving them above ground where it’s cheaper to build. Further cost savings are anticipated by using the design-build method of project delivery that has enabled the MTA to consolidate the project’s work into four contracts, not only making it easier to more closely manage contractors, but also in theory, reduce the need for expensive mid-project changes” since “designers and builders take on the responsibility of collaborating on project plans.” Two joint ventures have already been pre-qualified for a tunneling and station construction contract the MTA expects to award in the fall — Skanska Walsh Traylor, made up of New York City-based Skanska, New Jersey-based Walsh Construction, and Virginia-based Traylor Bros. and the second team, a joint venture of New York-based Halmar International and Florida-based Civil & Building North America Inc. under the entity Connect Plus Partners. Another change will be a shift away from a fully designed project plan being created by the MTA as it would typically do; and instead design only 30% of the project and then pass those plans onto the design-build entity for them to complete the project’s framework to avoid the higher rates contractors charged during the first phase of construction to account for possible unforeseen costs due to incomplete information about construction conditions that in some cases led to the need to reschedule work.
Strategies such as these have “shaved more than $1 billion in costs, already reflected in the $6.9 billion estimate. However, expenses due to Union labor rules also have a significant impact on project costs, prompting the MTA to explore a project labor agreement, which “governs terms and conditions of employment for all trade workers on a construction project.” Some of the more burdensome rules during Phase 1 construction led to the required payment to the tunnel workers’ union by the contractors of “$450,000 for every tunnel-boring machine used because the equipment was ostensibly taking jobs away from workers.” Also, the possibility of a work slowdown leading to cost overruns existed due to rules “around the types of work unions can perform” that places restrictions on which” laborers could dig trenches or set up traffic barriers or handle specific types of equipment.” A $3.4 billion portion of the financing for the project will come from a funding agreement the MTA secured with the Federal Transit Administration in 2023, with the MTA responsible for the remaining funding. However, ongoing litigation following the Trump Administration’s aim to revoke federal approval for the congestion pricing program could once again jeopardize second phase construction of the Second Avenue Subway project since