The Metro Board of Directors in February approved an amendment to the Life of Project Budget and a new contract with Tutor Perini/O&G for work on the third and final leg of the Purple Line Extension project between Century City and Westwood.

A number of local press understandably had a tough time — with justification — understanding the project budget process. The bottom line: the project’s budget has not risen dramatically, as some reported. Rather, the project’s budget has grown as expected as section 3 has reached milestones and work contracts have been issued.

Important background to understand: the third and final segment of Purple Line Extension project is being built in separate construction phases. It was purposely divided into separate procurement packages to keep work on Section 3 moving as quickly as possible and to position the project for future funding opportunities. Section 3 was also approved as a design-build project to expedite project completion.

A Life of Project Budget is established and amended as phases of the project are implemented and new contracts are awarded. Metro reports Life of Project Budgets progressively to maintain transparency and to ensure that funds are not committed too far in advance of when they are expected to be spent. For Purple Line Section 3, the total Life of Project budget, excluding finance charges, is $3.2 billion. The Life of Project Budget for the entire Purple Line Extension Project, excluding finance charges, is $8.4 billion.

Here’s a breakdown of costs-to-date for Section 3, the last 2.6-mile subway extension segment that, if approved for a federal match soon, could begin construction later this year:

• June 2018: Metro establishes a Section 3 Life of Project Budget of $1.37 billion for the tunnels portion of the project. Metro awards Frontier-Kemper/Tutor Perini Joint Venture a $410 million contract for tunneling work.
• February 2019: The Metro Board amends Section 3 Life of Project Budget of $1.37 billion to $3.2 billion, with the additional funding covering construction of the two stations (both along Wilshire Boulevard at Westwood/UCLA and Westwood/VA Hospital) and track work, systems and testing. Metro awards Tutor Perini/O&G a $1.36-billion contract for this work is subject to the Federal Transit Administration’s approval of a federal grant that will help pay for some of Section 3 — similar to grants received for Sections 1 and 2.

The entire Purple Line Extension project is based on a three-phase schedule, which is expected to include $5.2 billion in federal grants and loans. County sales tax proceeds from voter-approved Measure R and Measure M are providing critically needed local funding to match the federal contributions and accelerate construction work.

Purple Line Section 3 is scheduled to be operational in 2027.