here we also finalize the pricing and scope for the overhead contact system and the control system for the muni bus plaza. we continue to work with the pg&e and san francisco public utility commission to bring permanent power to the belgian as part of quitting a coronation work and we continue to work with our neighbors. connections to the park and also some of the work we're doing on the sidewalks so were on the same page with them and the construction activities. as you recall, we awarded packages last year. these design packages involve quite a bit of design coordination because we had to review the design work, expedite approval in order to maintain the schedule so quite a bit of design work for these packages. and the design team continues to request for

information and take question from bidders. one important note in coronation, last year was coronated the mechanical electrical and plumbing systems for phase 1. we have the mechanical electrical plumbing contractors on board. the design and assistance for phase 1. we want to make sure what they're putting in their does not conflict with any future elements we might incorporate in phase 2. so the design team worked closely with them with her layout to make sure there's no conflict as we come in to phase 2 to complete the systems we need for phase 2. so we can do that without removing the phase 1 systems. the board awarded 13 fans packages last year. more than $292 million. for the bus storage, we received budget report in april. we issued project

specification and estimates in september. and we started evaluation with caltrans and the cost estimate with caltrans. for our archaeology work, we drafted the first volume of the archaeological resource reports. for the transit center. this report documents investigations we did and the findings, and this is a three set volume. volume 1 is completed. we hope to complete the other two volumes this year. the bus ramp we completed the report and we continue to work with our neighbors regarding the redevelopment parcels. we are obligated in our agreement with the state historical officer to be able to courtney that work for the wii development parcels and were doing that the block five, seven, and eight. for phase 2, we release the supplemental environmental document in

december. we had a public hearing last night and respect receive the comments february 29. we also work closely with caltrans on coming to an agreement with the platform height between caltrans high-speed rail. i do it imagine the board was instrumental in getting the partners agreed on common heights. it was tough to make it happen. we also initiated a phase 2 delivery option study. the reason the purpose of the study is to look at the funding constraints we have for phase 2, status of the work, scope of the work, and determine what would be the best delivery option for phase 2. we hope to share the results of that way.this year with you. we continue to work with our colleagues in the city on the rail yard alignment study. and provide them with the technical information they need for the study. we worked with mtc in

support of the phase 2 cost review. that was done in november of last year. if you recall, mtc to the cost review of phase 1 and phase 2. the next 3-4 slides also you the results of phase 2 of the mtc review look at the scope we have. we shared with them the cost spreadsheets we have. the bottom-up estimates we have. and they did their own schedule analysis to drive at their conclusion and the next life i'll share that with you. we will start by going over the history of the budget for phase 2. if you recall, in march 2008, the board approved the budget for phase 2 for approximately $3 billion. this budget was based on top-down construction methods for the transit center among mean that the transit center will be built and while the transit center is in operation phase 2 will commence until the train parks underneath the transit center by excavating the transit

center. in may of 2010, we successfully were able to secure $400 million in funds. that enabled us to do the bottom-up approach, which we shifted between block scope to phase 1. allows us to build the drain box is phase 1. that was a very important milestone because you moved quite a bit of risk from phase 2 and reduce the cost of phase 2 by approximately $100 million by our estimate. so, thereby the budget for phase 2 was reduced to approximately $2.6 million. that budget is based on a design delivery method and i assume construction will begin in 2011 and continue operations in 2018. between 2008 and 2013 we continue to update the work on the btx and phase 2. an update estimate, update the

scope. new scope was added in 2010, 30% design for the btx was completed in the bottom-up estimate was developed. in 2012, at the 50% design for the train box set out is completed for the bottom-up estimate was completed. in 2013, we share the estimates with the board and this is a breakdown of the estimates. using the base construction cost is about $21.8 billion. we included across the twin 69 dollars for design contingency. the purpose of the design contingency is to cover scope gaps between the 30% design that we have any 100% design. we also included $131 million in construction manager for total construction cost of $2.1 billion. we updated updated right away cost a stunned recent prices. we also included $182 million in the program reserves. this estimate also assumes delivery method and assumes your

operation of 2024. as i mentioned we did a thorough review of the schedule and other items. we look at six main items. we look at our schedule compared to the schedule they developed independently and concluded that seven-year schedule that we have in our budget is sufficient. we also looked at the indirect cost markup although overhead assumption in our estimate was 26%, they agreed that percentage was sufficient. for the escalation, we assumed 3% escalation interest to me. that escalation rate is based on the cost price index for construction for 10 years. it's also based on what california is using. and mtc's long-term range of plans is using. the cost review by mtc recommends we use 5%. 5% is

more in line with caltrans user for construction projects. we also increase the contractor of the resumed just 5%, to 10%. we assumed a 5% based on comparative beds and i have a healthy market conditions. mtc's conclusion was, based on experience, we have on phase 1, and the complexity of the job, that we should assume a 10% contractor fee. our assumption was also based on us offering aside into the contractor in order to attract a number of bidders. the construction budget contingency we assumed 23%. mtc suggested we use 27%. mtc review the scope and they pointed out three main areas that the scope is not included in the asp. these are listed on the slide totaling $58 million. they asked us to look to increase this item adding

another $22 million. we assumed townsend street would be fully closed what were doing the tunneling. they came back and told us we should assume we have to maintain traffic there. so, that would add again $22 million. at that the work would be included in the design contingency we have set aside of 20 $6 million. we also have a trackback maintenance of way tracks right away in that scope was introduced to us in 2015 by caltrans when they reviewed the supplemental administrative costs environmental document. so that's why it's not included in the estimates. they also asked us to consider including $1.85 million for temporary lip relocation. we assume some utilities be protected in place . mtc suggested we may not be able to protect all the utilities in place. we will have to relocate them back and they put an estimate of $1.85 million on that. the scope will

read this covered by the design contingency. in conclusion, increasing escalation grade from 5% from 3% to 5% would add $433 million. the fee from 5% to 5% would add $100 million in contractor fees. increasing the contingency from 24%, to 27% would add $93 million. so, that would add a total of $684 million. the mtc cost review they suggested we add the bart muni pedestrian connector. the bart muni pedestrian connector is not included in our estimate but is included in the environmental document. the reason is not included is when the 20% was done for the btx,

we want to connect the transit center to buy. this alternative variant scope and cost. moving forward, the alternative will be considering is connecting two-streets according to mtc reports that alternative is to cost between $123 million. so, based on mtc review, there cost estimate review suggests that the phase 2 cost is between 3.8 and $4 billion. moving forward, for the cost review, once we complete our delivery report, delivery options report, we would update the project to include the new scope that was discovered. remove the old school that we no longer were we. refresh that based on today's market price. we have the quantities based on the bottom-up estimate be done in 2010. we need to refresh-we

were fresh based on today's prices and we escalate it. we also need to conduct a risk management assessment review identified some of the risks we have, quantify them put a price tag on them and update the estimate accordingly. with that, >> is there any impact or does any of this work, the cost review with the deliberate review informed at all the supplemental environmental document? something such as the traffic decking would presumably change your traffic profile during construction just as one example. i would think there may have been things that were in the report or things raised in discussion the might of the informed some tweaks to the entire mental document? >> to my knowledge is limited -and the-the supplemental

>> the supplemental document were iterations of the previous 2004 document. the particular item you pulled up was in the original document. some of it was left out because i might in fact, we were going to build the townsend underground station on caltrans when. therefore, we were not in townsend street. the supplemental document has moved it back into townsend street to enable development in that area. therefore, that needs to be added in. it was addressed in the supplemental documents. where moving back into the middle townsend street >> nothing else can out of the whole cost of review process? i know they were looking not just the cost of some of these construction method issued. nothing that came out of that that's not covered including the environmental click >> we not change the root.

therefore this is the same-these are variations that required mainly by high-speed railroad caltrans which are operational requirements. they are not changing the method of construction. the entire mental document was very clear that even if at the 2004 time that we would not go out of our way to disrupt people. you can't do that. so that has not changed. we have to keep traffic moving. we have to keep noises down. as much pollution as possible down considering were doing and underground job. i don't see any big changes that came up. the meeting last night had no questions about that either. it was fairly smooth public meeting. >> thank you. >> the scope items came out of

the cost review. >> mike, when are we going to-when this is bored looking at the summary potential adjustments to phase 2 cost estimate and consider when whether or not we agree with them and will put them in the budget? >> yes. i like to finish the delivery report and present that to you. show you the options because if you look at the different delivery options, studies have shown that if you go from a design build to design that you would save approximately 4%. if you go from a design build to a-you'll save another 4%. so, in theory if you take a $3 million we have estimated right now and you go to a design build, evidence $2.8 million. if you go to phase 3 that becomes $2.6 billion. so, what we need to do

is finish the delivery study present that to you. refresh our estimate. we need to take our estimate refresher to today's prices versus escalated from 2010 prices. as moved. we need to reset it. maybe sometime later on this year we can present the findings to the board >> later on this year? >> yes we would like to do that. we just need to-- >> is all conceptual as you said? >> we would update our cost based on the scope that we shared with you on the scope items. any outcome of the process for scope adjustments will include that and will present to you that full picture as we have it today. >> i mean, i don't get behind the curve on this. there's a lot going on in days do that we have to start planning on. >> absolutely. >> part of that planning is to adjust the budget whenever you

need to adjust the budget and you seem to be conceding here that mtc has some good points, at least 2.5-$3 million with a good points and bribes that should be done fairly early? >> dereferencing which- >> the summary of potential adjustments. you said, yes some of the things we were not following mtc's suggestions. >> they did a thorough review and for the escalation we would solve that by refreshing the estimate with today's dollars and estimate 5% moving forward. that's not an issue. the feet adjustments we have to think hard to go from 5%-to 10%. the reason i say that, they're getting $100 million of fees based on the 5%. they would get $200 million of the based on 10%. that additional $100 million we probably could do some outreach, have a stipend

to pay them to bed and if we get four bidders, we don't have to take it to 10%. so there some studies we have to do to alleviate that. on the contingency, going from 24% phase 2 when i'm percent just bumping up percentages. we need to refresh and police percentages >> i just think would be great to get the opinion of the board and the advisory committee on some of these notions rather than way to go that much further down. because these are abstract notions that you have of how we can do this and you need not wait too long before you can get it sent to the board. >> i agree 100%. i just want to present you the information. this information-i would like to give you the most recent information to to make a more informed decision. will do that later this year. >> with that, alternate over to

our construction management team. to discuss instruction accomplishments. >> good morning, board numbers. i'm very excited to show you with the college men's work instruction for this last year. you have seen this graphic. this to have them here that steve rhode has shown in his monthly updates. i put them side-by-side to show you the comparison to the top one being january and the lower one being december. it is interesting when you look at january 2015 we were still talking and this is a very good graphic that we been using but i think this really tells it. 2011, 12, and 13 were focus of excavation. 2014 was a lot of focus on concrete. report almost 100,000 yd.3 of concrete in the train

bus. 2015 is indicative by these pictures of what happened in the 12 months out there in a few. it's unbelievable progress. a very dramatic. a lot of instant gratification we put steel in place. it's been very gratifying to the point that this is 2015 has been truly the year of steel. was a very good progress. now, at this point were over 99% done. they're essentially just welding for the most part. we are topping out ceremony that will go into that was just about a month ago. very exciting and it's 225,000 craft hours. justin steel alone last year to get all this material off. almost 25,000 tons, which that's about 55 boeing 747's. each one of those ways about 900,000 pounds without payload was 450 tons. so nobody has to do the math. there's a lot of work out ther l