There’s abundant academic evidence about the consistent tendency of “megaprojects” to overrun early cost estimates. Bengt Flyvberg has literally written a book about it.
No Accountability for Overruns
There have been furtive efforts to oversee ODOT. In November 2015, Governor Brown said she was commissioning a performance management audit of ODOT.
ODOT did nothing for the first five months of 2016, and said the project would cost as much as half a million dollars. Initially, ODOT awarded a $350,000 oversight contract to an insider, who as it turns out, was angling for then ODOT director Matt Garrett’s job.
After this conflict of interest was exposed, the department rescinded the contract in instead gave a million dollar contract to McKinsey & Co. (so without irony, ODOT had at least a 100% cost overrun on the contract to do their audit).
And what McKinsey produced amounted to a whitewash, as I explained at Bike Portland. The audit covered up a long series of ODOT cost overruns, and instead focused on a long series of meaningless measures of internal administrative processes, such as the average time needed to process purchase orders. Meanwhile, the state’s million dollar auditors excluded from their cost overrun calculations the U.S. 20 Pioneer Mountain project, the single most expensive project that ODOT had undertaken, and even though excluding it, managed to understate and mislabel the 300% cost overrun.
The final report from McKinsey recommended that ODOT could become more efficient by giving more money to consultants like McKinsey (as humorist Dave Barry would say “I’m not making this up”).
Which, in a way, brings us full circle: Dave Barry was one of those principally responsible for popularizing the exploding whale story. With ODOT, the explosions just keep coming, but now they’re confined mostly destroying project budgets, rather than raining blubber. At least with whales, ODOT learned from its mistakes. When it comes to massive cost overruns, it’s simply become the way this agency does business. We give the last word to Barry, who narrates the whale explosion:
So they moved the spectators back up the beach, put a half-ton of dynamite next to the whale and set it off. I am probably not guilty of understatement when I say that what follows, on the videotape, is the most wonderful event in the history of the universe. First you see the whale carcass disappear in a huge blast of smoke and flame. Then you hear the happy spectators shouting “Yayy!” and “Whee!” Then, suddenly, the crowd’s tone changes. You hear a new sound like “splud.” You hear a woman’s voice shouting “Here come pieces of… MY GOD!” Something smears the camera lens.