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Enough with tram slams already

MY VIEW • Outgoing boss Vic Rhodes tells his side of story

Commissioner Sam Adams' continued assault on the management of the Portland aerial tram and the staff involved in the project requires a response.

In his Feb. 3 opinion piece, 'Accountability counts most,' Adams wrote: 'Public employees have an obligation to tell the truth, no matter how ugly that truth may be.' This is a worthy standard, one that he, as an elected public official, and his staff at City Hall should adhere to as well.

On his Web site, the commissioner has posted a number of entries. In announcing that the tram now costs $55 million, he writes: 'The tram could have been $65 million. We have cut $9.6 million from unnecessary project costs on the tram project.' Other entries by Commissioner Adams and his chief of staff, Tom Miller, continue with that theme, claiming responsibility for the cost savings.

Is this misleading? The fact of the matter is that project staff Ñ the same staff that Commissioner Adams vilified as 'grossly mismanaging' the project Ñ were the ones that identified $8.9 million of the cuts and worked with the Portland Aerial Transportation Inc. board and architect to enact them. The reductions were summarized in a Dec. 22, 2004, cost analysis paper prepared for the PATI board Ñnine days before Commissioner Adams took office and two months before he attended his first PATI board meeting.

In another entry regarding my resignation as executive director of PATI, the commissioner wrote, 'While Vic Rhodes had verbally agreed to resign on Wednesday morning, I mistakenly announced to my City Hall colleagues that his resignation was certain. In fact, Rhodes decided to reconsider before making a final decision today.'

To be clear, I resigned exactly once: on Jan. 20, effective March 20. The commissioner apparently was so bent on claiming victory that he prematurely released a written press statement announcing my resignation on Jan. 18.

Commissioner Adams has repeatedly stated that the project has been mismanaged. This allegation casts a cloud on the PATI board, the excellent, hardworking city staff and me. The record is clear. At every milestone through the design process, the project came back to the City Council for approval of both the design and budget. Most significantly, the project came back in June 2004, for approval of the $28.5 million budget, and last April, when the City Council approved the $40 million budget and construction contracts.

The original project budget was set by the PATI board at $15.5 million. This was a budget and not an estimate based on project plans, as none existed at the time. When schematic design was completed at the end of 2003, the first true cost estimate was produced by the architect's cost consultant and vetted by the PATI board with an independent estimating firm. The City Council approved both the design concept and revised budget estimate ($28.5 million) in June 2004. The issue of missing soft costs and contingency was explored at this time as well.

In October 2004, owing to increases in the complexity of the structural design requirements, increases in the price of steel and concrete, and devaluation of the U.S. dollar, the project cost estimate stood at $40 million. As with previous iterations of the design, the PATI board directed that the cost estimate be verified by an independent construction expert.

The current City Council approved the project design and accepted a revised $40 million budget estimate last April. Contracts for construction were approved, and construction bidding was imminent. The summer of 2005 brought Hurricanes Katrina and Rita, which devastated the Southeastern United States. Demand for labor, equipment and materials spiked, and construction prices rose rapidly over the space of a few weeks and months at the precise time the critical construction packages were out to bid. The rise in construction costs has hit both private and public construction projects throughout the nation.

There is no way that the increases over the last nine months can be construed as mismanagement of the project unless Commissioner Adams or others think that the project team had foreknowledge of these natural disasters and their market consequences.

The continued scapegoating that is occurring is distracting from the real issue at hand Ñ how to fund a project in the midst of construction and lead that project to success.

Vic Rhodes is the executive director of PATI and former head of the city's Office of Transportation.