Transmitting Communication from Louis A. DePasquale, City Manager, relative to the appropriation of $5,000,000 from Free Cash to the Public Investment Fund Executive Department Extraordinary Expenditures account for the City’s annual contribution to the Massachusetts Bay Transportation Authority (MBTA) Green Line Extension (GLX) project

January 22, 2018 To the Honorable, the City Council: I am hereby requesting an appropriation of $5 million from Free Cash to the Public Investment Fund Executive Department Extraordinary Expenditures account, for the City’s first contribution to the GLX project. The Massachusetts Bay Transportation Authority (MBTA) and the Massachusetts Department of Transportation (MassDOT) have been working for many years to advance the Green Line Extension (GLX) project from planning to design, and then into construction and operation. This project will extend the Green Line from its current terminal at Lechmere to serve seven new stations in Cambridge, Somerville, and Medford. From the Cambridge perspective, the principal benefits of this extension include the following: Construction of a new Lechmere Station to replace the current facility, which is obsolete, in poor condition, and not fully accessible for those with disabilities. Creation of frequent and reliable service from sections of Somerville and Medford that are currently not easily accessible by public transportation. In addition to better serving trips to Boston that pass through Cambridge, the GLX will serve trips from these locations into the key employment centers located in eastern Cambridge. Assisting in meeting the City’s and the region’s mobility, sustainability, and economic development goals. In addition, the relocated Lechmere Station enables a number of opportunities associated with the Cambridge Crossing development, including the extension of First Street across Monsignor O’Brien Highway, the creation of a new development parcel at the current location of Lechmere Station, and general improvements to access the entire site. Based on these multiple benefits, the City of Cambridge has long been supportive of this project, and has pushed the MBTA and MassDOT to move the project expeditiously, despite multiple delays and attempts to cancel the project.

In 2015, after construction on the project had commenced, the Commonwealth announced that the project was significantly over budget, and put construction on hold, pending a review of the design, cost factors, construction methods, and procurement strategy, with the goal of determining whether the project should be moved forward in a modified and less costly manner, or whether it should be cancelled despite the construction work already completed. During this review of the project, Secretary of Transportation Stephanie Pollack made it clear that she expected some level of municipal financial contribution to the project, to help offset the cost increases. Although this request was unprecedented for a public transportation project in Massachusetts, both the City of Cambridge and the City of Somerville agreed to enter into negotiations with MassDOT in order to help save the GLX as an active project. Based on these negotiations, which also included representatives from Divcowest, owners of the Cambridge Crossing (then Northpoint) development, Cambridge agreed to contribute $25 million dollars to the GLX project, half of which ($12.5 million) will come from contributions by DivcoWest. At the same time, Somerville agreed to contribute approximately $50 million dollars to the project, recognizing the more substantial benefit that they will realize from the project. The Boston Region Metropolitan Planning Organization (MPO) also agreed to reprogram the $150 million in federal funding originally intended for the next phase GLX extension to State Route 16 to help pay for the current project. Based on these financial commitments, along with changes to the design to simplify the project and reduce costs, the Commonwealth determined that it would continue to move forward with the project, subject to ongoing discussions regarding the project scope and budget. The agreements between the City, MassDOT, and the MBTA were then laid out and memorialized in the attached Project Participation Agreement (PPA), which was entered into on December 14, 2016. The PPA also described the various rights and responsibilities of the parties, including a schedule of contributions, the milestones that the MBTA and MassDOT must meet, and the procedures for refunding excess municipal contributions. At the City Council meeting on September 26, 2016, the City Council authorized the City Manager to enter into this agreement and sign the PPA. A similar agreement was developed with the City of Somerville for their $50 million contribution. Since the signing of the PPA, the MBTA has made significant progress on the GLX project, including hiring a new Program Manager and developing a more detailed version of the design that formed the basis for the decision to move forward. The MBTA also made a decision to switch to a design-build procurement method, which should provide a greater degree of cost certainty once the contract is in place. The MBTA then developed and advertised a design-build request for proposals, and went through an extensive, multi-step process to solicit and evaluate proposals from potential design-build teams. Three proposals were received, two of which were below the maximum allowed price and were therefore fully evaluated. On November 20, 2017, the MBTA’s Fiscal and Management Control Board awarded the contract to build the project to a joint venture called GLX Constructors, at a contract price of just over $1 billion, allowing the project to restart in earnest. In addition, the MBTA has created the GLX Community Working Group (CWG), which will provide a collaborative forum for information sharing between the GLX project and external stakeholders, including schedules, activities, and potential impacts associated with construction, while also soliciting stakeholder feedback. The CWG will include representatives from the City, DivcoWest, and the East Cambridge Business Association.

As laid out in the PPA, the first Cambridge contribution for the GLX project is due on March 1, 2018, with subsequent contributions due November 1 for each of the following four years (2019- 2022); each contribution is an equal amount of $5 million. MassDOT and the MBTA have met their initial obligations under the PPA, notably having met the Start of Construction by having signed a contract and issued a Notice to Proceed to GLX Constructors and by establishing the Green Line Extension Project Cambridge Participation Expendable Trust contemplated in the PPA to receive contributions from the City of Cambridge. Based on this, we are fully expecting to need to make the initial $5 million contribution on March 1, 2018. Very truly yours, Louis A. DePasquale City Manager LAD/mec Attachment(s)