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Final oversight report on Ninth and Jefferson Building project
February 10, 2011
The Metropolitan King County Council directed the King County Auditor’s Office (KCAO) to provide independent oversight and monthly reporting for the Ninth and Jefferson Building (NJB) project in September 2006. We have previously provided 31 monthly project status reports and a presentation to County Council’s Government Accountability and Oversight Committee.
Two separate projects were required to complete NJB at a total cost of $221.2 million. The initial project was publicly funded. It was abandoned when estimated costs exceeded available revenue. A restructured project using private financing successfully delivered a much larger building at a reduced cost per square foot.
This report provides a final assessment of the NJB project, a medical office building developed in order to reduce overcrowding and upgrade outmoded facilities at Harborview. In addition to assessing the final scope, schedule, and budget results for the project, this report summarizes feedback gathered from major stakeholders, the project team, and building tenants through interviews, surveys, and a facilitated group discussion session aimed at identifying lessons learned. This report closes out KCAO’s oversight effort.
The Auditor has followed up on the report to evaluate implementation of our recommendations. See the most updated information below.
Prior reports on this project are found below.
Of the 3 recommendations:
| DONE | 1 | Recommendation has been fully implemented. Auditor will no longer monitor. |
|---|---|---|
| PROGRESS | 0 | Recommendations are in progress or partially implemented. Auditor will continue to monitor. |
| OPEN | 0 | Recommendations remain unresolved. Auditor will continue to monitor. |
| CLOSED | 2 | Recommendation is no longer applicable. Auditor will no longer monitor. |
Final project summary
This final oversight report for the Ninth and Jefferson Building project not only reviews the final scope, schedule, budget, lessons learned, and recommendations, but also summarizes feedback from major stakeholders. This report closes out KCAO’s oversight effort.
The project team successfully delivered the approved scope, resulting in highly positive feedback from key stakeholders and building tenants. Additional revenue and project savings enabled them to provide more than $14.6 million in scope enhancements improving the efficiency of the building for tenants.
Wright-Runstad successfully met all of the development agreement schedule milestones. However, move-in delays occurred for some individual tenants.
Proactive cost control and budget management resulted in project savings. The forecast cost at completion for the project is $188.7 million including scope enhancements paid for by savings and additional revenue.
The lessons learned described below were derived from an extensive data-gathering process with project participants, including interviews, anonymous online surveys, and a facilitated discussion session. In addition, they reflect KCAO’s observations based on several sources: a review of NJB project related ordinance records, attendance at project implementation meetings, ongoing monitoring and reporting between July 2007 and June 2010, and an assessment of the project delivery results. They are organized into two sections: lessons of interest to all projects and lessons specific to 63-20 public-private partnerships:
Lessons applicable to all King County capital projects
- The GC/CM project delivery method requires vigilant contract management to assure that the general contractor is held responsible for their cost risks.
- County lease requirements are complicating the effort to secure retail tenants for NJB.
- Establishing and maintaining effective communications with stakeholders is important to help guarantee project success.
- Project agreements should specify the format, organization, and content of the developer’s project cost reporting, building operating and maintenance (O&M) manuals, and as-built drawing submittals based upon a single standard agreed to among all stakeholders.
Lessons for 63-20 public-private partnership projects
- Partnering with highly qualified nonprofit organizations and building developers who have prior experience successfully completing 63-20 projects is important.
- It is important to assign agency representatives to 63-20 projects who are familiar with public-private partnerships, including enforcing the legal agreements involved.
- Leveraging the private sector expertise of the developer, general contractor, and product vendors is recommended to help achieve the most cost-effective outcome.
- A guaranteed maximum price for the building must be established and enforced.
- The County Executive should review existing policies, procedures, and standard contract language for GC/CM projects and revise them as needed to guard against cost risks like those experienced during the initial project.
- FMD should work with the PAO and council to streamline the county’s lease approval process in order to be more competitive in the marketplace without unduly sacrificing risk control.
- FMD should document its practices for managing 63-20 public-private partnership projects and develop strategies to transfer the specialized knowledge of experienced project management personnel to other project managers in FMD and other divisions new to this funding method.
Reports related to this audit
The Ninth and Jefferson Building oversight reports are shown below in chronological order.
Reports issued in 2009
Ninth & Jefferson Building project oversight report for January 2009, February 23, 2009
Ninth & Jefferson Building project oversight report for February 2009, March 26, 2009
Ninth & Jefferson Building project oversight report for March 2009, April 15, 2009
Ninth & Jefferson Building project oversight report for April 2009, June 5, 2009
Ninth & Jefferson Building project oversight report for May 2009, July 14, 2009
Ninth & Jefferson Building project oversight report for June 2009, September 4, 2009
Ninth & Jefferson Building project oversight report for July 2009, September 4, 2009
Ninth & Jefferson Building project oversight report for August 2009, November 2, 2009
Ninth & Jefferson Building project oversight report for September 2009, December 23, 2009
Ninth & Jefferson Building project oversight report for October 2009, December 23, 2009
Ninth & Jefferson Building project oversight report for November 2009, June 7, 2010
Ninth & Jefferson Building project oversight report for December 2009, June 8, 2010
Reports issued in 2008
Ninth & Jefferson Building project oversight report for January 2008, January 15, 2008
Ninth & Jefferson Building project oversight report for February 2008, February 15, 2008
Ninth & Jefferson Building project oversight report for March 2008, March 15, 2008
Ninth & Jefferson Building project oversight report for April 2008, April 15, 2008
Ninth & Jefferson Building project oversight report for May 2008, May 15, 2008
Ninth & Jefferson Building project oversight report for June 2008, June 15, 2008
Ninth & Jefferson Building project oversight report for July 2008, July 15, 2008
Ninth & Jefferson Building project oversight report for August 2008, August 15, 2008
Ninth & Jefferson Building project oversight report for September 2008, September 15, 2008
Ninth & Jefferson Building project oversight report for October 2008, October 15, 2008
Ninth & Jefferson Building project oversight report for November 2008, November 15, 2008
Ninth & Jefferson Building project oversight report for December 2008, December 15, 2008
Reports issued in 2007
Ninth & Jefferson Building project oversight report for July 2007, July 27, 2007
Ninth & Jefferson Building project oversight report for August 2007, August 16, 2007
Ninth & Jefferson Building project oversight report for September 2007, September 15, 2007
Ninth & Jefferson Building project oversight report for October 2007, October 15, 2007
Ninth & Jefferson Building project oversight report for November 2007, November 15, 2007
Ninth & Jefferson Building project oversight report for December 2007, December 15, 2007
Click on the image(s) below to view related reports.
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July 9, 2013 |
Audit team
Larry Brubaker, Jones Lang LaSalle (consultant), Tina Rogers, and Tom Wood conducted this work. If you have any questions or would like more information, please call the King County Auditor's Office at 206-477-1033 or contact us by email KCAO@kingcounty.gov.