This is the accessible text file for GAO report number GAO-02-1069R entitled 'District of Columbia: Status of Construction of the Convention Center' which was released on September 24, 2002. This text file was formatted by the U.S. General Accounting Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. Please E-mail your comments regarding the contents or accessibility features of this document to Webmaster@gao.gov. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. Because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. United States General Accounting Office: Washington, DC 20548: September 24, 2002: The Honorable Constance A. Morella: Chairwoman: Subcommittee on the District of Columbia: Committee on Government Reform: House of Representatives: Subject: District of Columbia: Status of Construction of the Convention Center: Dear Madam Chairwoman: You asked us to provide periodic briefings on the status of the construction of the new convention center in Washington, D.C. The convention center is being constructed in accordance with the Washington Convention Center Authority Act of 1994, which authorizes the Washington Convention Center Authority (WCCA) to construct, maintain, and operate a new convention center while continuing to maintain and operate the existing convention center. As agreed with your office, we reviewed information related to the status of the convention center construction, costs, and financing as of June 2002, the most recent information available at the time of our review. Specifically, our objectives were to provide information on (1) issues related to the Revised Guaranteed Maximum Price agreement (RGMP) [Footnote 1] set in January 2002, (2) the status of construction and significant construction issues that could delay completion of the project, (3) whether the January 2002 estimated total project cost [Footnote 2] of $799.5 million has changed, and, if so, the causes and nature of the changes, and (4) whether WCCA’s funding appears to be sufficient to cover the current estimated total project cost. In order to meet these objectives, we reviewed the RGMP, held discussions with and obtained information from WCCA officials and the DC City Council’s oversight contractor for the project, reviewed the construction manager’s (CM) and WCCA’s monthly progress reports and WCCA’s financing plan, visited the construction site, and considered the results of our prior work, which were most recently reported to you in January 2002. [Footnote 3] We conducted our work from April through August 2002 in accordance with generally accepted government auditing standards. On August 22, 2002, we briefed the staff of your subcommittee on the preliminary results of our review. This letter transmits material from that briefing, which includes data through June 30, 2002, the most recent information available at the time we prepared this report. The briefing slides are included in enclosure I. Results in Brief: On January 31, 2002, the RGMP was set by the CM and WCCA at $590.7 million. As part of the RGMP agreement, WCCA is responsible for cost increases resulting from changes in design and scope (and not attributable to improper management by the CM and subcontractor error). As of June 30, 2002, the RGMP has increased by $7 million to $597.7 million. These increases were related to changes in design and the resulting scopes of work for specific building trades. WCCA officials told us that the RGMP would continue to increase as a result of such changes and that they are working to quantify the extent. The project construction schedule, as established by the RGMP, includes the following deadline dates for the project: (1) substantial completion [Footnote 4] of convention-ready areas [Footnote 5] by March 31, 2003, (2) substantial completion of all remaining areas by June 30, 2003, and (3) final completion [Footnote 6] by October 1, 2003. As of July 2002, according to WCCA officials, the convention center construction activities were approximately 80 percent complete. Although the project was 20 days behind schedule as of June 2002, WCCA officials say they are taking steps to meet the current construction schedule. WCCA has identified several significant construction issues that, if not resolved, could delay completion. WCCA is working with the CM and architect/engineering team to address these issues. A critical milestone that must be achieved in order for WCCA to maintain the construction schedule is completing the facility’s exterior shell, which WCCA had initially anticipated occurring in late October or early November 2002. WCCA has now set a time frame for this to occur in December 2002. Missing the December 2002 milestone could significantly affect the project schedule, delaying completion of the interior work and adding to the risk of delaying the completion of the convention center. In the event that WCCA does not meet the December 2002 milestone, a mitigation plan has been developed which WCCA officials described as allowing critical interior work to proceed in a dry environment. According to WCCA, the total estimated project cost remained at $799.5 million as of June 2002. However, WCCA has identified several factors that will increase the project cost. WCCA has quantified potential cost increases of $23.8 million. Additional costs are anticipated by WCCA for unspecified mechanical, electrical, and plumbing (MEP) changes and to negotiate and settle CM submitted and unsubmitted change orders of $38.1 million. As of June 2002, WCCA’s total estimated cost of $799.5 million included $9.8 million in contingency and owner’s adjustment accounts to cover unanticipated cost increases. WCCA is working with the CM to minimize the effects of potential cost increases. The estimated project funding available as of June 30, 2002, was $822.5 million, or $6.8 million more than the $815.7 million projected as available during January 2002. As of June 30, 2002, $805.4 million, or 98 percent of the total projected funding has been received. Assuming all projected funding is collected and no cost growth occurs, there would be residual funding of about $23 million based on the June 30, 2002, cost and funding estimates. Adding this amount and the approximately $9.8 million of contingency and owner’s adjustment account balance now included in the $799.5 million estimated project cost for unanticipated cost increases, the amount available to absorb cost increases could be $32.8 million. As of June 2002, known cost increases totaled $23.8 million and there are also a number of known but unquantified and unnegotiated changes. WCCA officials noted that they continue their efforts to implement cost-reducing measures. WCCA officials told us that they believe the available funding will be sufficient to cover the total estimated project costs, including the estimated cost increases associated with factors discussed in this briefing through the end of the project. We provided WCCA a copy of the transmittal letter and slides for comment. WCCA agreed that the draft letter and briefing slides accurately reflect the status of the convention center project. WCCA also provided some technical comments and clarifications which we have incorporated as appropriate throughout the briefing slides. We are sending copies of this report to the Ranking Minority Member of your Subcommittee. We are also sending copies to the Chairmen and Ranking Minority Members of the Subcommittee on the District of Columbia; Senate Committee on Appropriations, Subcommittee on the District of Columbia; House Committee on Appropriations and other interested congressional committees. This letter will also be available on GAO’s home page at [hyperlink, http://www.gao.gov]. If you have any questions, please contact me at (202) 512-9471 or by e- mail at franzelj@gao.gov. Key contributors to this letter were Keith A. Thompson, Terrell G. Dorn, Arkelga L. Braxton, Maria D. Edelstein, and Donell L. Ries. Sincerely yours, Signed by: Jeanette M. Franzel: Director, Financial Management and Assurance: Enclosure: [End of section] Enclosure: U.S. General Accounting Office: Financial Management and Assurance Team: District of Columbia Government: Status of the New Convention Center Project: Briefing for the Staff of the House Committee on Government Reform, Subcommittee on the District of Columbia: August 22, 2002: Introduction/Objectives: You asked us to provide periodic briefings on the status of the construction, costs, and financing of the new Washington, D.C., convention center. Our objectives were to provide information on: * issues related to the Revised Guaranteed Maximum Price agreement (RGMP), which was set in January 2002; * the status of construction and significant construction issues that could delay completion of the project; * whether the January 2002 estimated total project cost of $799.5 million has changed, and if so, the causes and nature of the changes; and; * whether the Washington Convention Center Authority’s (WCCA) funding appears to be sufficient to cover current estimated project costs. Background: The Washington Convention Center Authority Act of 1994 authorizes WCCA to construct, maintain, and operate the new convention center as well as to maintain and operate the existing convention center. WCCA’s Managing Director/Development oversees the contract and the construction with the assistance of the program manager, a group made up primarily of three consulting groups and several subcontractors. The Construction Manager (CM) is a joint venture responsible for the construction of the new convention center. The construction management services agreement between the CM and WCCA includes a Guaranteed Maximum Price (GMP) for hard costs--which include construction costs such as site work, concrete, and metals--but excludes soft-cost items. [Footnote 7] The GMP is intended to represent the final construction price negotiated for hard costs between the CM and WCCA. However, adjustments to the GMP may be made to reflect quantities and costs that differ from the baseline assumptions as the project progresses. The CM and WCCA executed the RGMP agreement for $590.7 million on January 31, 2002. The DC City Council has hired a contractor to provide periodic status reports on the construction of the convention center. Results in Brief: Although the RGMP was set at $590.7 million in January 2002, WCCA is responsible for cost increases resulting from design and scope changes, except for such increases that are the result of improper management by the CM. The RGMP has increased $7.0 million, from $590.7 million at January 31, 2002, to $597.7 million as of June 30, 2002. These increases were related to changes in the design and scope of electrical and roofing work, metals work, and mechanical, electrical, and plumbing (MEP) work. WCCA officials told us that the RGMP will increase as a result of design and scope changes related to steel, MEP, and fireproofing trades. A critical milestone in maintaining the construction schedule is completing the facility’s exterior shell, which WCCA had initially anticipated occurring in late October or early November 2002. However, WCCA has now set a time frame for this to occur in December 2002. Missing the December 2002 milestone could affect the timeliness of completion of the convention center. According to WCCA officials, the convention center construction activities were approximately 80 percent complete as of July 2002, and WCCA is taking steps to meet the current construction schedule. WCCA is working with the CM and the Architect/Engineer (A/E) team to address significant issues that could delay completion of the project. Total estimated project cost remained at $799.5 million, according to WCCA, including available contingency balances of $9.8 million, as of June 2002 (contingency balance outside of the RGMP of $7.2 million and owner’s adjustment account in the RGMP of $2.6 million). WCCA has identified several factors that could result in a projected cost increase of $23.8 million. In addition, WCCA has identified other potential increases that are not yet quantified. WCCA is working with the CM to minimize the effects of factors that could lead to cost increases. WCCA has established allowances/reserves to cover costs that are anticipated but not completely quantified and a contingency amount to cover unanticipated cost increases. Available project funding increased from $815.7 million in January 2002 to $822.5 million in June 2002, according to WCCA. The estimated funding sources of $822.5 million, less total estimated project costs of $799.5 million, resulted in an estimated residual funding, as of June 30, 2002, of $23 million. However, WCCA has stated that the total estimated cost will increase. The estimated residual funding added to the contingency and owner’s adjustment account totals $32.8 million. When compared to the quantified potential cost increases, the potential excess available funding is $9.0 million as of June 30, 2002. However, all of these figures are subject to uncertainty. WCCA officials told us that they believe the available funding amount will be sufficient to cover the total estimated project costs, including identified potential cost increases through the end of the project. We requested comments on a draft of these briefing slides from WCCA’s Chief Financial Officer and Managing Director/Development, who agreed that the draft letter and briefing slides accurately reflect the status of the convention center project. They also provided technical comments and clarification which we have incorporated as appropriate throughout the briefing slides. Revised Guaranteed Maximum Price: On January 31, 2002, the RGMP was set by the CM and WCCA at $590.7 million. However, WCCA is responsible for cost increases resulting from changes in design and scope (and not attributable to improper management by the CM and subcontractor error). Any such increase will have to be absorbed by WCCA’s available funding. The RGMP has increased $7.0 million from $590.7 million at January 31, 2002, to $597.7 million as of June 30, 2002. These increases were related to changes in design and scope for electrical and roofing work, metals work, and MEP work. WCCA must absorb these cost increases. WCCA officials told us that the RGMP will increase as a result of cost increases resulting from changes in design and scope related to steel, MEP, and fireproofing trades. WCCA estimated a $3.2 million increase related to steel but was unable to determine the amount of the other potential increases at the time of our review. The RGMP consists of seven cost components. Table 1 shows the components and the corresponding amounts as of June 30, 2002. Table 1: Components of the RGMP and Costs as of June 30, 2002 (Dollars in millions): Amount: $496.8; Description: Work that was included in the scope of the original GMP amendment. This amount includes allowances and reserves for remaining purchases, unit rate allowances, and submitted and unsubmitted change orders that WCCA tracks separately. Amount: $15.9; Description: Work related to hazardous material removal cost. Amount: $36.2; Description: Out-of-scope estimate for Metro station, telecommunications, food service, audiovisual, and certain utility work. Amount: $33.0; Description: Estimate for the cost of general conditions and general requirements[A]. Amount: $12.9; Description: Construction fee to be paid to the CM[B]. Amount: $0.3; Description: Utility relocation fee. Amount: $2.6; Description: Owner’s adjustment account to be used at WCCA’s discretion. Amount: $597.7; Description: Total cost of RGMP components. [A] The estimate for the cost of general conditions and general requirements consists of CM field overhead items such as onsite trailers, onsite staff, blueprinting, fringe benefits, and consultants. [B] The construction fee is the CM’s profit and home office overhead for managing the project. It consists of the amount in the original GMP of $9.5 million and increases due to change orders and out-of-scope work. [End of table] Status of Construction: A critical milestone that must be achieved in order for WCCA to maintain the construction schedule is completing the facility’s exterior shell, which WCCA had initially anticipated occurring in late October or early November 2002. However, WCCA has now set a time frame for this to occur in December 2002. Missing the December 2002 milestone could significantly affect the project schedule, delaying completion of the interior work and adding to the risk of delay in timely completion of the convention center. In the event that WCCA does not meet the December 2002 milestone, mitigating plans include installation of temporary weather walls and weather protection that would allow critical interior work to proceed in a dry environment. The following deadlines were reset in the RGMP: * substantial completion [Footnote 8] of convention-ready areas [Footnote 9] by March 31, 2003; * substantial completion of all remaining areas by June 30, 2003; and; * final completion [Footnote 10] by October 1, 2003. According to WCCA officials, the convention center construction activities were approximately 80 percent complete as of July 31, 2002, and WCCA is taking steps to meet the current construction schedule. WCCA has identified several significant construction issues that, if not resolved, could delay completion of the project. WCCA is working with the CM and A/E team to address these issues, including: * increasing the number of workers, overtime, or both in order to expedite the exterior enclosure work and the interior trades work to meet the deadline dates; * providing a sufficient period of time to move into the facility and establish operations of the major systems, and; * expediting the landscape/hardscape [Footnote 11] work, which is currently several months behind schedule. In the event that the CM does not meet the June 30, 2003, substantial completion date, the CM would be required to pay $50,000 per day for each calendar day of delay. However, unless the delay is the result of the CM’s gross negligence in conducting its management responsibility or the CM’s deliberate failure to comply with a material directive from WCCA, WCCA must accept from the CM an assignment of CM claims against subcontractors as payment of liquidated damages. Status of Costs: Estimated Costs: According to WCCA, the total estimated project cost remained at $799.5 million as of June 2002 (see table 2). Table 2: Comparison of WCCA’s Unaudited Estimated Costs for the New Convention Center as of September 1998, January 2002, and June 2002 (Dollars in thousands): Project component: WCCA-estimated hard costs[A]: Estimate as of 9/1998: $505,600; Estimate as of 1/2002: $590,678; Estimate as of 6/2002: $597,669. Project component: WCCA-estimated soft costs[B]: Estimate as of 9/1998: $118,903; Estimate as of 1/2002: $145,524; Estimate as of 6/2002: $143,462. Project component: Contingency[C]: Estimate as of 9/1998: $30,497; Estimate as of 1/2002: $9,966; Estimate as of 6/2002: $7,159. Project component: Estimated cost of outsourced work[D]: Estimate as of 9/1998: $59,000; Estimate as of 1/2002: $53,380; Estimate as of 6/2002: $51,258. Project component: Total estimated construction costs: Estimate as of 9/1998: $714,000; Estimate as of 1/2002: $799,548; Estimate as of 6/2002: $799,548; Percentage change from 9/1998 to 6/2002: 12.0. [A] Hard costs are construction costs related to the physical structure of the facility, such as masonry, concrete, hazardous material removal, and structural steel. This line item also includes an owner’s adjustment account of $2.6 million as of June 30, 2002, which is a contingency within the RGMP. [B] Soft costs are construction costs that are not related to the physical structure of the facility, such as design fees, legal costs, and consulting and inspections. This line item also includes $10.8 million of other costs, which include administrative costs related to marketing, public affairs, and salaries of staff dedicated to the project. [C] The contingency is an estimate in the project’s budget that is earmarked for cost increases. [D] Estimated cost of such outsourced work as work on the Metro station, utility relocation, central plant, telecommunications, and food service, for which WCCA has identified specific funding sources as a part of the total available financing. Source: WCCA records. [End of table] WCCA had incurred $576.6 million or 72 percent of the $799.5 million total estimated project cost as of June 30, 2002. Although construction costs were within the total project cost estimate at the time of our review, WCCA has identified factors that will increase costs. WCCA has quantified potential cost increases of $23.8 million (as shown in table 3) related to such factors as: * accelerated construction activities; * MEP coordination issues [Footnote 12]; * second shift and overtime work; * projected cost overrun for the Metro station; * back-up steel associated with the exterior enclosure, and; * Department of Public Works (DPW) hardscape subcontract. WCCA officials stated that the quantified potential cost increases may not impact the total estimated project cost. WCCA is still assessing the exposures and their potential cost impact. For other factors that it is working to address, WCCA had not, at the time of our review, specified a cost estimate or had not finalized its estimate. These factors include: * implementing MEP design changes and; * the CM’s submitted and unsubmitted change orders outstanding, which totaled $38.1 million as of June 2002. Table 3: Summary of Potential Cost Increases as of June 2002 (Dollars in thousands): Potential cost increases: Accelerated construction activities and MEP coordination costs[A]; Estimated amounts: $13,200. Potential cost increases: Second shift and overtime; Estimated amounts: $2,600; Potential cost increases: Projected cost overrun for Metro station; Estimated amounts: $1,800. Potential cost increases: Back-up steel associated with exterior enclosure; Estimated amounts: $3,200. Potential cost increases: DPW subcontract; Estimated amounts: $3,000. Potential cost increases: Subtotal; Estimated amounts: $23,800. Potential cost increases: MEP design changes; Estimated amounts: Unknown. Potential cost increases: Resolution of change orders; Estimated amounts: Unknown. [A[ This line item refers to costs associated with expediting work, completing the exterior enclosure, and resolving MEP coordination issues. Source: WCCA records. [End of table] WCCA is working with the CM and WMATA to minimize the effects of factors that could lead to cost increases. * According to WCCA officials, negotiations are ongoing with the CM to resolve the $38.1 million in submitted and unsubmitted change orders generated since the RGMP was put in place. * To address projected cost overruns for expansion of the Metro station, WCCA and WMATA meet weekly to discuss ways to reduce costs. Status of Costs, Allowances/Reserves and Contingency Balances: WCCA has established allowances/reserves and a contingency amount as means for absorbing various costs that may occur throughout the project. An allowance, according to WCCA officials, is an amount set aside within a purchased subcontract for known work that did not have a detailed scope of work when the subcontract was awarded. Reserves, according to WCCA officials, are amounts set aside for a known scope of work, within the RGMP, that has not yet been contracted. The contingency is an estimated amount earmarked for unanticipated cost increases. Tracking the balances in the allowances/reserves and contingency that have been established outside and inside of the RGMP is key to monitoring WCCA’s progress in completing construction on time with minimal cost overruns. See summary of allowances/reserves and contingency balances in table 4. Table 4: Summary of Unaudited Allowances/Reserves and Contingency Balances (Dollars in thousands): Description: Allowances/Reserves: Allowances/reserves; January 31, 2002 (RGTMP effective date), Inside RGMP: $14,700; January 31, 2002 (RGTMP effective date), Outside RGMP: $4,364; January 31, 2002 (RGTMP effective date), Total: $19,064; June 30, 2002, Inside RGMP: $10,237; June 30, 2002, Outside RGMP: $3,067; June 30, 2002, Total: $13,304; Change: $(5,760). Description: Allowances/Reserves: Pending trade change reserves; January 31, 2002 (RGTMP effective date), Inside RGMP: $20,250; January 31, 2002 (RGTMP effective date), Outside RGMP: [Empty]; January 31, 2002 (RGTMP effective date), Total: $20,250; June 30, 2002, Inside RGMP: $19,428; June 30, 2002, Outside RGMP: [Empty]; June 30, 2002, Total: $19,428; Change: $(822). Description: Allowances/Reserves: Total; January 31, 2002 (RGTMP effective date), Inside RGMP: $34,950; January 31, 2002 (RGTMP effective date), Outside RGMP: $4,364; January 31, 2002 (RGTMP effective date), Total: $39,314; June 30, 2002, Inside RGMP: $29,665; June 30, 2002, Outside RGMP: $3,067; June 30, 2002, Total: $32,732; Change: $(6,582). Description: Contingencies: Owner's adjustment account; January 31, 2002 (RGTMP effective date), Inside RGMP: $9,800; January 31, 2002 (RGTMP effective date), Outside RGMP: [Empty]; January 31, 2002 (RGTMP effective date), Total: $9,800; June 30, 2002, Inside RGMP: $2,600; June 30, 2002, Outside RGMP: [Empty]; June 30, 2002, Total: $2,600; Change: $(7,200). Description: Contingencies: Contingency; January 31, 2002 (RGTMP effective date), Inside RGMP: [Empty]; January 31, 2002 (RGTMP effective date), Outside RGMP: $9,966; January 31, 2002 (RGTMP effective date), Total: $9,966; June 30, 2002, Inside RGMP: [Empty]; June 30, 2002, Outside RGMP: $7,159; June 30, 2002, Total: $7,159; Change: $(2,807). Description: Contingencies: Total; January 31, 2002 (RGTMP effective date), Inside RGMP: $9,800; January 31, 2002 (RGTMP effective date), Outside RGMP: $9,966; January 31, 2002 (RGTMP effective date), Total: $19,766; June 30, 2002, Inside RGMP: $2,600; June 30, 2002, Outside RGMP: $7,159; June 30, 2002, Total: $9,759; Change: $(10,007). Source: WCCA. [End of table] Funding: Estimated available funding increased from $815.7 million at January 2002 to $822.5 million at June 2002, according to WCCA. This is attributed to a: * $1.4 million increase in the estimate of interest earned on the $25 million congressional contribution being held by WMATA for Metro construction; * $5 million increase in the contribution to be received from the vendor selected to provide food service, and; * $.4 million increase in the estimate of federal highway funds. WCCA had received $805.4 million (98 percent of the estimated total $822.5 million) of available funding as of July 31, 2002. According to WCCA officials, the remaining $17.1 million is expected from the following financing sources: * $9.4 million in federal highway funds. * $5 million in vendor reimbursements [Footnote 13] yet to be negotiated. Until these vendor reimbursements are negotiated and received, WCCA is at risk for these costs. * $2.7 million from interest earned on the $25 million congressional contribution being held by WMATA. The estimated funding of $822.5 million exceeds total estimated project costs of $799.5 million, as of June 30, 2002, by $23 million. However, WCCA has stated that the total estimated cost will increase. The estimated residual funding combined with the owner’s adjustment account and the contingency could be used to cover future increases in total project costs not now covered by existing allowances/reserves in the cost estimates. (See table 5.) WCCA officials told us that they believe the available funding will be sufficient to cover the total estimated construction costs, including the estimated cost increases associated with factors discussed in this briefing, through the end of the project. Table 5: Analysis of Remaining Funding Available and Quantified Potential Cost Increases (Dollars in thousands): Description: Estimated project residual funding[A]; Estimated amounts: $23,000. Description: Contingency; Estimated amounts: $7,159. Description: Owner's adjustment account; Estimated amounts: $2,600. Description: Subtotal; Estimated amounts: $32,759. Description: Less: Quantified potential cost increases[B[; Estimated amounts: $23,800. Description: Potential excess of available funding over quantified potential cost increases as of June 2002; Estimated amounts: $8,959. Note: All of the figures above are subject to uncertainty. [A] This figure was calculated using the estimated cost figure of $799.5 million, which WCCA has stated will increase. [B] Quantified potential cost increases are estimates that are subject to change. In addition, potential increases for MEP design changes and resolution of change orders have not been quantified. [End of table] Scope and Methodology: In order to determine what was updated as a result of the RGMP agreement, we reviewed the RGMP to determine the final settlement of pending change orders submitted by the CM, the new RGMP estimate, and new construction deadline dates. We also held discussions with WCCA officials to discuss issues related to the RGMP. In order to determine the status of construction and identify related issues, we: * held discussions with WCCA officials and the DC City Council’s oversight contractor regarding the status of the project as of June 2002 and observed weekly construction status meetings between the CM and WCCA, and; * reviewed the CM’s and WCCA’s monthly progress reports and visited the construction site. In order to evaluate estimated cost information, we: * reviewed estimated project costs included in WCCA’s monthly status reports through June 2002 to identify any cost increases since January 31, 2002, and held discussions with WCCA officials to discuss factors that could affect costs; and; * held discussions with the DC City Council’s oversight contractor to monitor progress and identify major issues associated with the RGMP and the total estimated project cost. In order to determine if estimated funding appears sufficient, we reviewed WCCA’s financing plan to analyze whether the current estimated funding covers the remaining estimated project cost and any identified project cost increases. We conducted our work from April through August 2002 in accordance with generally accepted government auditing standards and considered the results of our most recent work, which were reported to you in January 2002. [Footnote 14] Agency Comments: WCCA agreed that the draft letter and briefing slides accurately reflect the status of the convention center project. WCCA provided some technical comments and clarification which we have incorporated as appropriate throughout the briefing slides. [End of enclosure] Footnotes: [1] The RGMP is intended to represent the final construction price negotiated for hard costs between the construction manager and WCCA. [2] WCCA established the $799.5 million total project cost estimate in January 2002. [3] U.S. General Accounting Office, District of Columbia: Status of the New Convention Center Project, GAO-02-335T (Washington, D.C.: Jan. 18, 2002). [4] Substantial completion means that the area is completed enough to obtain a certificate of occupancy that can be issued on a partial or temporary basis. Building support systems and life safety systems must be working. [5] According to the RGMP, convention-ready areas include the south building, central plant area, portions of the north and middle buildings necessary to occupy the lower exhibit hall, and the west concourse necessary to serve the lower exhibit hall. [6] Final completion means the completion of all three buildings and minor items identified by WCCA during the final walk-through. [7] Soft costs are construction costs that are not related to the physical structure of the facility, such as design fees, legal costs, and consulting and inspections. [8] Substantial completion means that the area is completed enough to obtain a certificate of occupancy that can be issued on a partial or temporary basis. Building support systems and life safety systems must be working. [9] According to the RGMP, convention-ready areas include the south building, central plant area, portions of the north and middle buildings necessary to occupy the lower exhibit hall, and the west concourse necessary to serve the lower exhibit hall. [10] Final completion means the completion of all three buildings and minor items identified by WCCA during the final walk-through. [11] This work involves replacing all the curbs, sidewalks, and roadways around the new convention center, as well as installing new lighting and planting trees. [12] These costs are the result of design changes necessary to resolve conflicts between MEP design drawings and the structural and architectural design drawings. [13] WCCA anticipates reimbursements for equipment costs related to telecommunications and audiovisual. [14] U.S. General Accounting Office, District of Columbia: Status of the New Convention Center Project, GAO-02-335T (Washington, D.C.: Jan. 18, 2002). [End of section] GAO's Mission: The General Accounting Office, the investigative arm of Congress, exists to support Congress in meeting its constitutional responsibilities and to help improve the performance and accountability of the federal government for the American people. GAO examines the use of public funds; evaluates federal programs and policies; and provides analyses, recommendations, and other assistance to help Congress make informed oversight, policy, and funding decisions. GAO’s commitment to good government is reflected in its core values of accountability, integrity, and reliability. 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