According to a new report from the Amtrak Office of Inspector General (OIG), Amtrak has not completed all necessary planning for the Frederick Douglass Tunnel (FDT) program despite the approach of major construction, increasing the risk of cost overruns and schedule delays.
The report notes the estimated $6 billion FDT program is the single largest infrastructure effort Amtrak is leading, with construction scheduled to start this year. According to the report, Amtrak is developing its management structure for the FDT program but initially did not have an effective structure or sufficient staff in place. In December 2022, Amtrak hired a contractor—a delivery partner—to provide management and oversight but until it onboarded the contractor more than a year later, it relied on an overwhelmed internal team to manage multiple, complex and concurrent commitments.
According to the report, the Federal Railroad Administration (FRA) approved the program in 2017 but the availability of funding to advance into the construction phase remained limited for several years. Amtrak’s Strategy and Planning department restarted planning in 2021 in anticipation of receiving funding with the passage of the Infrastructure Investment and Jobs Act (IIJA) and turned over responsibility for the program to the nascent Capital Delivery department in 2022. In 2023, the FRA awarded $4.7 billion for the FDT program through an IIJA-funded grant program.
The report reveals that at the time it took over responsibility for the FDT program, the Capital Delivery department was developing its own processes and hiring project and program professionals to improve Amtrak’s oversight of its major capital programs. Because it had not established a process to ensure sufficient staffing at the outset of a program, the Capital Delivery department initially assigned responsibility for the $6 billion FDT program to a single person who had limited support to manage and oversee a program of this size and complexity.
The report notes that by October 2023, Amtrak’s program team grew from one member to seven, including an assistant vice president. Despite the additional staff, five of six staff-level members told Amtrak OIG auditors they were overwhelmed by the workload. Senior Amtrak officials acknowledged the insufficient staffing, in part due to funding restrictions, and noted that Amtrak should have staffed the Capital Delivery team before it took responsibility for the FDT program.
The OIG also found that Amtrak did not establish a program management structure early enough. According to the report, industry standards suggest organizations establish a program management structure in a program’s early stages. Without an effective management and oversight structure or sufficient staff from the outset, Amtrak struggled to produce the necessary planning in four key areas:
- Scheduling
- Communications
- Document management
- Risk management
As a result, Amtrak OIG notes the program experienced delays and faces a significantly increased risk of cost overruns and additional delays as it proceeds into major construction. In addition, the delivery partner must now concurrently complete program management planning at the same time that it and Amtrak prepare for and start construction.
To reduce the risk of delays and cost overruns, the OIG recommended Amtrak advances the requisite program management planning and that it improves program planning processes to ensure that it implements a management structure and provides sufficient staff early enough to avoid similar challenges on future programs. Given the scale of Amtrak’s historic capital plans, the report says avoiding similar challenges on other programs will be key to protecting and maximizing taxpayer investments.
More information is included in the full report, which can be downloaded on Amtrak’s OIG’s website.
