	Work on the Project Is Progressing, but Delays Continue

AOC and its contractors have continued to make progress on the project  since the Subcommittee’s July 14 hearing. Although  AOC has not evaluated the contractor’s August schedule, it does not  believe that so much additional time will be needed. Furthermore, as  discussed in the next section, AOC maintains that work could be  accelerated to meet the September 15, 2006, target date. Project’s Schedule, Including Possible Actions to Accelerate Work, Raises Management Concerns

According to our analysis of the CVC project’s schedule, the base project  is unlikely to be completed by the September 15, 2006, target date for  several reasons. Base Project’s Construction Is Likely to Be Completed Later Than Scheduled for Several Reasons

For several reasons, we believe that the base project is more likely to be  completed sometime in the spring or summer of 2007 than by September  15, 2006:    As we have previously testified, AOC’s sequence 2 contractor, Manhattan  Construction Company, has continued to miss its planned dates for  completing activities that we and AOC are tracking to assist the  Subcommittee in measuring the project’s progress. Conversely, using temporary equipment or adding workers to overcome  delays could increase the project’s costs if the government is responsible  for the delays. AOC tied the date for opening the CVC facility to the public to September  15, 2006, the date in the sequence 2 contract for completing the base  project’s construction. In our view, allowing some  time to address unexpected problems is prudent. We have not reassessed this area  recently. Actions Are Needed and Being Taken to Move the Project Forward and Address Concerns

Since the Subcommittee’s July 14 CVC hearing, we have discussed a  number of actions with AOC officials that we believe are necessary to  address problems with the project’s schedule and our concerns. Project Costs and Funding Provided as of September 2005

AOC is still updating its estimate of the cost to complete the CVC project,  including the base project and the House and Senate expansion spaces. However, our current $525.6  million estimate does not include costs that AOC may incur for delays  beyond those delay costs included in our November 2004 estimate. The House and Senate  Committees on Appropriations were notified of this situation and AOC’s  plan to address it. However, if AOC encounters significant additional costs for  delays or other changes, more funding may be needed. Appendix I: Risk Assessment Methodology

With the assistance of a contractor, Hulett & Associates, we assessed the  risks associated with the Architect of the Capitol’s (AOC) July 2005  schedule for the Capitol Visitor Center (CVC) project and used the results  of our assessment to estimate a time frame for completing the base CVC  project with and without identified risks and uncertainties. AOC’s construction management and  sequence 2 contractors found that key detailed activities associated with  the HVAC system had not been included in the schedule and that the  durations for a number of activities were not realistic. Taking all of these  factors into account, AOC’s contractors revised the project’s schedule in  August. AOC believes that the revised schedule, which shows the base  project’s completion date slipping by several months, allows too much  time for the identified problems. CPP is developing a cost estimate for this option. We are reviewing these issues. of Defense (DOD)
Bid prices exceeding estimates, preconstruction costs exceeding budgeted costs,  unforeseen field conditions,   Other factors (costs associated with delays and design-to-budget overruns)
Project budget after increases (as of November 2004)
GAO-projected costs to complete after proposed scope changes (as of June 2005, excluding  risks and uncertainties)
Additional cost-to-complete items (as of August 2005)
Design of the Library of Congress tunnel (Funds from Capitol Preservation Fund)
GAO-projected costs to complete (as of August 2005, excluding risks and uncertainties)
Potential additional costs associated with risks and  uncertainties (as of November 2004)
Less: Risks and uncertainties GAO believes the project faced in  November 2004 [Congressional seals, orientation film, and backpack storage space ($4.2) +  US Capitol Police securitymonitoring ($3.0)]   (7.2)
Less: Additional cost-to-complete items (as of August 2005) (3.1)
The five additional scope items are the House connector tunnel, the East Front elevator extension,  the Library of Congress tunnel, temporary operations, and enhanced perimeter security.
Why GAO Did This Study

This testimony discusses progress on the Capitol Visitor Center (CVC) project. Our remarks will focus on (1) the Architect of the Capitol's (AOC) progress in managing the project's schedule since the Subcommittee on the Legislative Branch, Senate Committee on Appropriations' July 14 hearing on the project; (2) our estimate of a general time frame for completing the base project's construction and the preliminary results of our assessment of the risks associated with AOC's July 2005 schedule for the base project; and (3) the project's costs and funding, including the potential impact of scheduling issues on cost. However, we will not, as originally planned, provide specific estimated completion dates because AOC's contractors revised the schedule in August to reflect recent delays, but AOC has not yet evaluated the revised schedule. AOC believes that the time added to the schedule by its contractors is unreasonable. Until AOC completes its evaluation and we assess it, any estimates of specific completion dates are, in our view, tentative and preliminary. Similarly, we will wait until the schedule is stabilized to update our November 2004 estimate of the cost to complete the project. Currently, AOC and its consultant, McDonough Bolyard Peck (MBP), are still developing their cost-to-complete estimates.

What GAO Found

In summary, although AOC and its construction contractors have continued to make progress since the Subcommittee's July 14 CVC hearing, several delays have occurred and more are expected. These delays could postpone the base project's completion significantly beyond September 15, 2006, the date targeted in AOC's July 2005 schedule. Although not yet fully reviewed and accepted by AOC, the schedule that AOC's contractors revised in August 2005 shows February 26, 2007, as the base project's completion date. According to our preliminary analysis of the project's July 2005 schedule, the base project is more likely to be completed sometime in the spring or summer of 2007 than by September 15, 2006. Unless the project's scope is changed or extraordinary actions are taken, the base project is likely to be completed later than September 15, 2006, for the reasons cited by the contractors and for other reasons, such as the optimistic durations estimated for a number of activities and the risks and uncertainties facing the project. AOC believes that the contractors added too much time to the schedule in August for activities not included in the schedule and that it can expedite the project by working concurrently rather than sequentially and by taking other actions. Additionally, we are concerned about actions that have been, or could be, proposed to accelerate work to meet the September 15, 2006, target date. The project's schedule also raises a number of management concerns, including the potential for delays caused by not allowing enough time to address potential problems or to complete critical activities. Fiscal year 2006 appropriations have provided sufficient funds to cover AOC's request for CVC construction funding as well as additional funds for some risks and uncertainties that may arise, such as costs associated with additional sequence 2 delays or unexpected conditions. Although sequence 2 delays have been occurring, the extent to which the government is responsible for their related costs is not clear at this time. Additional funding may be necessary if the government is responsible for significant delay-related costs or if significant changes are made to the project's design or scope or to address unexpected conditions. In addition, we and AOC identified some CVC construction activities that received duplicate funding. AOC has discussed this issue with the House and Senate Appropriations Committees.