Arvada staff recommend canceling West 72nd Avenue underpass as costs swell to ~$137 million

Arvada city staff on Jan. 20 recommended cancelling the planned West 72nd Avenue underpass and evaluating alternatives after construction estimates rose sharply.

City Manager Don Wick introduced the workshop and said the recommendation was driven by a large increase in the latest construction estimate. "The recommendation that I am making to the council tonight is that we cancel the current underpass project and evaluate other alternatives, such as potentially widening the at-grade crossing," he said. Staff emphasized that, while an underpass would provide benefits for emergency response and traffic delay, the city would have to reallocate funds from other capital projects and incur additional debt to close the funding gap.

Jacqueline Rhodes, the city’s director of infrastructure, told the council the most recent estimate for construction package 3 (CP3) and owner contingency had risen to "almost a $137,000,000" total compared with secured funding of about $73,000,000, leaving a roughly $63,000,000 shortfall. Rhodes walked through direct construction items (CEMA Construction’s CP3 direct cost shown at about $52,000,000), a previously approved steel package (about $5.3 million), risk register items (about $5.5 million), a contractor fee of 7 percent, and added schedule duration and UPRR-required work that together added tens of millions in cost.

Rhodes said market conditions and iterative reviews by the Union Pacific Railroad (UPRR) drove much of the escalation: concrete unit costs increased around 30 percent in some lines, aggregate base and curb-and-gutter costs rose substantially, and design reviews and a 42-month construction schedule added more than $10 million. She told council that UPRR began rejecting the underpass design in 2020 after earlier coordination dating back to the early 2000s, and that the railroad’s structural and review requirements altered scope and schedule.

Council members pressed staff on timeline and scope questions, right-of-way implications and contingency assumptions. The city attorney said most easements and right-of-way were acquired voluntarily and paid at fair value and that the city was not at high legal risk from prior acquisitions. Rhodes said staff had been carrying a rough order of magnitude (ROM) estimate of about $97.5 million in prior financial plans but that the December 2025 contractor pricing and final-plan inputs yielded the higher figure.

On next steps, staff said they had given a verbal stop-work instruction to contractors and would follow with written notices; they will scope and return with an alternatives analysis that examines an at-grade widening, finishing work that can be completed in 2026 (Oak to Kipling), repaving and other corridor improvements, and will pursue grant opportunities where appropriate. Rhodes said the team scheduled a public open house for Feb. 2 at the Apex Community Center to present details and gather public input.

Multiple council members said they were disappointed but supported reevaluating the project to avoid placing other city services and planned projects at risk. Mayor Simpson and several council members emphasized that while a grade separation remains the safest option in principle, current conditions (reduced train crossings, changed emergency deployment, steep inflation) make the underpass cost-prohibitive now.

The workshop was informational; no formal council vote was required or taken on cancelling the project. Staff noted city code authorizes the city team to terminate contracts if needed and said they would not place new construction contracts on the agenda without council direction. Staff will return with an alternatives analysis and updated cost estimates after community outreach.

The presentation and public discussion established these immediate steps: a Feb. 2 open house, formal alternatives analysis and written contractor notices to begin administrative closeout of CP3 work until the council decides next steps.