Construction Law

The Largest Economic Development Project Underway in Anchorage Alaska is Stalled Under a Cloud of Ballooning Cost and Design Issues

By John P. Ahlers

The massive dock replacement project at the Port of Anchorage has been pushed back from a target date of 2011 (set before construction began) to 2021, and the price tag for the project has escalated $360 million in 2005 to $1 billion!

The old Anchorage dock, the construction of which dated back to before the 1964 earthquake, was deteriorating and expensive to maintain. That started an effort to replace the dock approximately ten (10) years ago. The long time Port Director Bill Sheffield (former Alaska Governor) promoted a controversial "open cell sheet pile" design to add 130 acres of dock space to the Port. Former Port employees and other groups questioned the design, believing it was incompatible with the silty conditions in the Cook Inlet. The design, created by Dennis Nottingham of PND Engineers, in 1980, uses steel sheet pile membranes to create cells to support the dock face. The cells are designed to be supported by anchors imbedded in the soil and by the soil itself, but the silty Cook Inlet conditions continue to hamper the process. The project management contractor for the expansion project, Integrated Concepts and Research Corporation ("ICRC") hired a construction company (QAP) to install more than $95 million worth of the open cell sheet pilings. When some of the pilings began to shift, QAP was removed from the project and paid $80 million for the work it partially completed. ICRC then reopened bidding on the project and hired West Construction Co. ("West") last summer to complete the work. West is predrilling the piles before driving them. An investigation showed that many of the piles driven by QAP were bent and split. In spots, the gaps were big enough for divers to reach in and through the sidewall, about three (3) feet away. Joints had separated, and the gravel compacted behind the sheet pile cells to create new land was spilling out. In some spots sink holes were forming. In all the inspections revealed 635 damaged sheet piles out of 2611 examined so far.

There are serious questions whether the open cell sheet pile design can be built considering the apparent high concentration of damaged piling revealed during the inspections. Sheffield's latest estimate is that the Anchorage new port will cost $1 billion by the time it is done. So far, the Maritime Administration (the federal entity administering construction) has received approximately $279 million of which it has committed or spent all but $14 million. Much of the money came from congressional earmarks no longer popular with federal legislators. Sheffield is optimistic that the money will come from a new multi-year federal highway bill which is before Congress this year. This exceedingly important Alaska infrastructure project is struggling and in grave jeopardy amid significant uncertainties as to whether it will ever be built. Alaska Congressman Young, who has secured tens of millions of dollars in earmarks for the Port over the years, is optimistic that money will keep flowing. Young acknowledges that earmarks are harder to secure in the new Congress, where a number of members are pushing for a moratorium on the practice.

http://www.adn.com/2011/01/15/1650843/port-of-anchorage-a-billion-dollar.html

Full post as published by Construction Law Blog on January 25, 2011 (boomark / email).