Shoreline council OKs roughly $7.5 million increase for 140th/5th Street corridor construction contract

The Shoreline City Council on June 2 unanimously approved an increase in the city manager’s change‑order authorization for the construction contract with Johansen Construction Company for the 140th Street/5th Avenue corridor and I‑5 interchange project, authorizing an additional $7,476,067.40 and setting a new contract ceiling of about $49.8 million.

The approval follows staff presentations that described cost and schedule impacts during the 2024 construction season caused by unforeseen utility conflicts, permitting and staging changes, and other on‑site conditions. Project staff said they are pursuing reimbursement from utility partners and grant programs but that the city may still face a multi‑million dollar shortfall.

City planning and public‑works staff told the council the project originally went to bid with the low construction bid of $38.2 million and an initial total council authorization of $42.3 million (which included roughly $4.1 million set aside for change orders). Since construction began in April 2024 the city has negotiated about $3.8 million in change orders and is forecasting additional needs. As staff put it in the presentation: “we are currently forecasting approximately 5,700,000.0 in additional budget need.”

Staff described three primary categories driving the new request: roughly $783,000 in additional known change orders not yet finalized; about $1.2 million in expected quantity overruns tied to measurement variations; and roughly $3.7 million in project risk. They said partner utilities — Lumen, Puget Sound Energy (PSE) and Seattle City Light (SCL) — are expected to reimburse an estimated $3 million to $3.5 million for costs directly tied to utility relocations.

The staff presentation also described permitting and staging complications. Officials said conflicts with existing utility infrastructure discovered during excavation, unforeseen Seattle permitting requirements, and WSDOT‑required changes to staging and traffic control contributed to work delays and reduced contractor productivity. Staff briefed the council that a negotiated equitable adjustment for delay is nearing completion and is a significant component of the added cost.

Staff outlined possible revenue offsets under discussion: a $750,000 overrun participation option from the Transportation Improvement Board (TIB) that requires TIB approval, and conversations with WSDOT/PSRC about reallocating unspent grant funds to shovel‑ready projects. The presentation said those discussions could reduce the city’s exposure, but that the city could still be liable for as much as about $4.5 million if partner contributions and grants do not materialize.

Council members pressed staff on why the additional costs were not foreseen in the bid and whether the contractor could absorb more risk. Staff said many of the issues — buried utility conflicts, sequencing and permitting changes, WSDOT staging requirements — could not reasonably have been anticipated at bid. Staff also noted that the other two bids received at opening were substantially higher (about $49.3 million and $51.8 million), and that applying the same unanticipated changes to those higher bids would have produced similar final costs.

The revised schedule includes an increase of 126 working days to the contract completion date, with staff projecting overall substantial completion in May 2026. The presentation said the west roundabout could open in September 2025 in a single‑lane temporary configuration and that the east roundabout is expected to open in January–February 2026. Staff warned of upcoming traffic impacts: a planned northbound reduction on 5th Avenue to a single lane for much of the remainder of the project, and a series of I‑5 southbound ramp closures and a full closure of 140th Street during September 2025 to transition intersections to the roundabout configuration.

Council members and staff emphasized lessons learned and a forthcoming internal review to refine risk assessment and project agreements for future phases. Staff said increases to consultant contracts and additional staff time related to the project will be brought back to the council for separate authorizations.

The motion to authorize the additional change‑order authority passed unanimously.