Records show funding uncertainty before 2012 Raleigh Union Station announcement

ccampbell@newsobserver.comAugust 18, 2013 

N.C. transportation secretary Gene Conti, left, and Joseph Szabo, federal railroad administrator inside the former Dillon Supply Viaduct Building on West Martin Street, future site of Union Station, Raleigh's new Amtrak depot.

BRUCE SICELOFF — bsiceloff@newsobserver.com Buy Photo

— In the weeks leading up to last September’s high-profile announcement that Raleigh’s new train hub was fully funded, top transportation officials voiced concerns that funding for the project was still uncertain, newly released records show.

In August 2012, N.C. Department of Transportation officials sought federal approval to shift $15.1 million in unspent funds to Raleigh Union Station from another project, a $520 million series of rail line improvements between Raleigh and Charlotte. The Piedmont Improvement Program is funded by federal stimulus dollars, and DOT officials discovered earlier this year that the project wouldn’t leave $15.1 million available for Raleigh Union Station.

That’s put Raleigh’s new station on an uncertain path, and officials have talked about scaling back the plans – possibly even building a temporary station until more money is secured.

Emails and meeting minutes – released by DOT through a public records request – show the funding estimates for the rail line project were changing frequently at the time of the September announcement, and federal officials urged state DOT leaders to wait before moving money to the train station.

NCDOT officials went to Washington on Aug. 29, 2012, to meet with the Federal Railroad Administration. Corey Hill, an FRA executive, asked “why NCDOT was so eager to secure the $15 million in funds for the Raleigh Union Station when there appeared to FRA ample time to phase the program,” according to minutes of the meeting.

Hill said the transfer was “too early” in the rail line project timeline, and FRA would only approve the move on a conditional basis, meaning DOT couldn’t spend the money on the train station until the rail line “reaches a substantially more mature state and the budgets are re-evaluated.”

Five days before the Washington meeting, NCDOT officials were still wrestling with cost estimates for the Piedmont Improvement Program, emails show. At the request of then-deputy secretary for transit Paul Morris, consultant Brian Speight cut costs on several line items, reducing the percentage of funds held for cost overruns and deleting a rail crossing project in Kannapolis that had proven unfeasible.

Speight included the $15.1 million transfer to Union Station in his calculation, and the estimates came up over budget.

That prompted a quick response from Morris. “Why are we still showing a $15.6 million gap?” he asked on Aug. 24.

The gap was still unresolved in September when leaders announced full funding for Union Station, said Paul Worley, DOT rail division director. “It was still outstanding,” he said last week.

Current Transportation Secretary Tony Tata blamed the funding confusion on Morris, whom he ousted in February shortly after taking office. “Unfortunately in this case, funding was overcommitted by one person against FRA mandate and (DOT) staff recommendations,” Tata said in a June news release.

Morris – who now heads Atlanta Beltline Inc. – has said DOT proved money was available before the Sept. 22 announcement that Union Station was fully funded. Reached last week, he said he couldn’t recall how the funding gap he’d noticed on Aug. 24 was resolved.

Morris said he sees competing philosophies at issue. Some leaders allow costs to rise on a project, while others make cuts as needed to stay within the original budget. “If the project changes, the project budget always goes up,” he said.

That’s part of why Union Station’s price tag jumped from $60 million last year to the current estimate of $73 million – architects added new elements to a planned civic plaza entrance, Worley said.

Despite the cost increase and funding shortfalls, deputy secretary for transit Richard Walls says Tata remains committed to the train station, and the agency doesn’t want to settle for a modular temporary option.

“(Tata) wants to go forward with the project,” Walls said. “Our edict is to move forward and see how we’re going to do that.”

Campbell: 919-829-4802 or twitter.com/RaleighReporter

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