Soo Locks reconstruction project costs exceed $1 billion estimate

SAULT STE. MARIE, MI – Inflation, rising labor costs and supply chain issues have inflated the estimated cost of a major reconstruction project at the Soo Locks shipping complex according to lawmakers, who claim that the costly effort has doubled or tripled in price compared to current projections.

The new estimates came out this week after briefings from Capitol Hill by the US Army Corps of Engineers, which is bidding for the final stages of the long-awaited project to build another lock capable of handling the largest freighters on the Great Lakes.

The changes challenged the rebuilding schedule, as Congress might have to reauthorize the project at a higher cost. Congress authorized the project in 2018 for up to $922 million and work was expected to be completed in 2030, but that now depends on the budget of the Congressional administration and Biden.

“We recognize that funding a larger amount for the new lock at the Soo is a challenge that could potentially have timing impacts,” said Soo Locks spokeswoman Carrie Fox. “The Corps of Engineers partners with industry and federal partners to find collaborative solutions to address the cost impact of our programs and projects.”

Lawmakers say the project relief measures are embedded in the latest Water Resources Development Act, or WRDA, which is waiting for floor votes in the House and the Senate.

U.S. Sen. Debbie Stabenow, D-Mich., expressed “deep frustration” with the new cost figures, but said project flexibility is addressed by the WRDA bill, which could allow construction to proceed. continue under the existing authorization until fiscal year 2025.

“One way or another, the new lock is going to be finished,” Stabenow said.

U.S. Representative Jack Bergman, a Republican who represents Michigan’s Upper Peninsula, called Soo’s new cost projections “extremely disappointing.”

“In addition to inflation and rising costs for everything from tools and equipment to personnel, the Corps made miscalculations in the initial cost estimates, making the total cost of the project much higher than initially thought,” Bergman said in a statement.

“It’s not something to sweep under the rug or pass off as an oversight,” Bergman continued. “Ultimately, it’s up to the Corps to take responsibility and be accountable for this issue, but Congress needs to implement the necessary oversight.”

Defenders of the Great Lakes shipping industry say they expect congressional action soon enough, citing longstanding bipartisan support for the project.

“Whether it’s a $1 billion or $2 billion project, it’s still a good investment in the future of North American manufacturing,” said James Weakley, president of the Lake Carriers Association, a group which represents U.S.-flagged vessels on the Great Lakes. “I believe the project will continue, especially since they have already invested nearly $1 billion.”

Weakley said part of the frustration on Capitol Hill appears to be based on the belief that the project has finally crossed the finish line, and “now it doesn’t appear to be.”

“It’s embarrassing that they got it wrong, but it’s better to find out sooner than later,” Weakley said. “And that gives Congress a more realistic opportunity to fix it.”

Over the next six years, the Corps reconfigured the inactive locks at Davis and Sabin into a single large chamber similar to the existing Poe Lock, which was 1,200 feet long and 110 feet wide. It is the only lock large enough to move the increasingly long and wide ships of the Great Lakes.

A second Poe-sized sluice will ensure that ore from Minnesota’s Iron Range could still reach steel mills in the lower Great Lakes if the sluice were to close unexpectedly.

In January, the Corps won what lawmakers thought was full funding for the project with $479 million from the bipartisan Infrastructure Act; which tracked $480 million from the president’s 2022 budget and nearly $300 million in 2020 and 2021 Congressional credits.

The project was estimated between 1.3 and 1.5 billion dollars.

The corps closed the tender for the third phase of the project, the construction of the new airlock itself, in January. Subsequently, he realized that the construction estimates of the industry were higher than those of the government, according to the Detroit News.

Fox said “market conditions” are affecting the Soo “as well as other civil engineering projects.”

“We take into account these changing market conditions, including materials, equipment and labor,” Fox said. “In order to be accountable, the U.S. Army Corps of Engineers is in the process of submitting a new cost estimate to Congress for reauthorization consideration.”

Construction of the new lock began in 2020 by deepening the channel by 25 feet leading to the new lock by an additional five feet to accommodate the drafts of modern vessels. The Jacobsville sandstone is dredged from the canal, resulting in a reddish-brown coloration in the water.

As channel dredging continues, crews have already begun work on the second phase of construction, which involves reinforcing the channel approach walls.

“The first phase is in the process of completing the works. We expect them to be completed within the next two months,” said Rachel Miller, civil engineer in charge of the project. “Phase two just started last summer and they still have a few years left.”

The third phase, the construction of the new lock chamber, should last about six years.

The unused Sabin Lock is being demolished and rebuilt into a wider and deeper lock. The lock was last used in the 1990s and is in a deteriorated state, with large cracks in the concrete walls, decaying wooden gates and growing vegetation.

The new lock will feature hands-free mooring, which Army Corps Construction Supervisor Kristina Schnettler likened to “giant suction cups” that will hold ships in place as the water level changes, “that which is a much safer process as handling the lines, they’re really heavy and there is also a risk of them breaking and injuring someone.

Work is complicated and prolonged by a colder climate and the need to halt construction for three months each year, the army corps said. Contractors must also cross shipping channels and two active locks, the MacArthur and the Poe, to reach the construction site.

The project was originally authorized in 1986, but was reauthorized in 2018 after the Army Corps recalculated its feasibility using a new cost-benefit analysis that took into account the lack of rail transportation options for move the iron ore if the locks break.

This update was pushed by the shipping industry, Congress and the administration of former Michigan Governor Rick Snyder, who agreed to pay $52 million to relaunch the project at the end of 2018.

It was also prompted by a 2016 federal homeland security report that suggested an unexpected six-month Poe Lock outage would wreak havoc on supply chains, plunge the country into a recession, and cost $11 million. jobs.

Having a second Poe-sized lock would allow redundancy at a critical link in the supply chain as well as greater efficiency in general shipping operations. All shipping – including freighters, tour boats, patrol boats, cruise ships and more – are using Poe Lock this spring while maintenance work is underway at the smaller MacArthur Lock, which has been emptied.

“With the new lock, we expect delays to be significantly reduced,” lockmaster Chris Albrough said last week. “On days when we’re jammed with traffic, we can basically have one-way traffic through each lock.”

Mark Barker, president of Interlake Steamship Company, which operates several 1,000-foot class vessels, including the largest Great Lakes ship, the Paul R. Tregurtha, said having a second large lock is “a vitally important for proper functioning. waterway.”

The cost of the project “affects all of us – we are taxpayers, aren’t we?” said Barker.

“I think we all want to make sure we can make cars and build things that need steel and this lock is what does that,” Barker said. “Trying to put real value on it is sometimes difficult.”

“You don’t know what you lose until you lose it.”

– MLive journalist Sheri McWhirter contributed to this report

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