Water authority to vote on adding to cost of intake

It will cost the Southern Nevada Water Authority almost $40 million to get its new Lake Mead intake project back on track after a series of setbacks that began last summer.

Water authority board members are slated to vote Thursday on a "change order" that would add another $39.5 million to the project's total price tag of roughly $700 million.

The change order also would extend the timeline for the project by 593 days to the summer of 2014. Authority officials made it known months ago that they expected the completion date to slip from early 2013 to sometime in 2014.

Marc Jensen, director of engineering for the water authority, said the proposed change order is large, but it is "not at all uncommon" for a large-scale underground construction project to rack up changes totaling 10 percent of its total cost.

"The risks associated with underground construction are greater than they are with other types of construction," he said. "There are a lot of uncertainties."

Vegas Tunnel Constructors, the project's designer and general contractor, has said that the conditions it has encountered underground are much worse than what was predicted by the geologic report included in the contract.

Jensen said authority officials do not entirely agree with that assessment, but the proposed change order would put the matter to rest.

The trouble began on July 1, when workers excavating a starter tunnel 600 feet underground hit a fault zone, causing water and debris to flood the work area.

Vegas Tunnel Constructors spent weeks trying to stabilize the fault, but the area flooded again on Oct. 27 and Dec. 31.

The contractor plans to abandon the starter tunnel and excavate a new one in a different direction in hopes of skirting the troublesome fault line.

The project involves mining a 23-foot tunnel through three miles of solid rock beneath the bottom of Lake Mead and connecting it to an intake structure that will stick up from the lake bed at one of the deepest spots in the reservoir's Boulder Basin.

The tunnel under the lake will be excavated using a tunnel-boring machine that will be lowered in pieces down the 600-foot vertical access shaft and put together underground.

That can't happen until the contractor can figure out a way to keep that assembly area and starter tunnel from flooding.

Jensen said it looks like the first pieces of the boring machine could be lowered into the assembly area by this summer and the machine could start its work by the end of the year.

Vegas Tunnel Constructors' piece of the project totals $487 million, which ranks as the single-largest construction contract ever awarded by the water authority. The change order would boost that figure to $526.6 million.

Unless water authority board members refuse the increase.

If that happens, Jensen said, the work would continue and the question of who should pay the added costs would have to be settled later.

But he added that rejection of the change order could jeopardize an insurance claim the authority has filed for the $39 million in damages and added construction costs .

The valley depends on two intake pipes to draw roughly 90 percent of its drinking water from Lake Mead. The third intake will pull from deeper in the reservoir, allowing the flow of water to continue even if the lake shrinks enough to shut down one of the two existing straws.

Authority officials initially worried that the new intake would be needed by 2013 to ensure that the valley's water system would have sufficient capacity to meet peak demand in the summer. Since then, concerns about capacity have eased as water use has declined and new water banking agreements have been reached.

Jensen said the authority ran into problems in the late 1990s during excavation work on its second Lake Mead intake.

That project was completed in 2000 but not before racking up change orders that increased the total cost from $68 million to $83 million.

Contact reporter Henry Brean at hbrean@reviewjournal.com or 702-383-0350.