POULSBO — Of the $3.8 million in federal stimulus dollars set aside for the Viking Way improvement project, more than $1 million is left over, and city officials plan to use that money.
It’s a familiar story, say those following the American Reinvestment and Recovery Act money designated for the region. Bids from contractors are arriving well below engineering estimates, partly because the estimates were beefed up to accommodate the soaring cost of construction materials which have drooped recently, and partly because contractors are eager to keep their equipment running in a shambling economy.
The result has been a boon for Kitsap, and not just Poulsbo.
Andrzej Kasiniak, Poulsbo city engineer, said it isn’t uncommon for contractor bids to arrive 20 percent below engineer estimates, and the leftover money from Viking Way has left him “pleasantly surprised.”
“We didn’t anticipate $1 million in savings,” Kasiniak said. “The bidding climate is completely different than it was even a year ago.”
The city has contingency plans to refurbish 1,000 linear feet of South Viking Avenue, Kasiniak said. The roads run through an area that has turned partly fallow with the withdrawal last year of Poulsbo RV, along with several auto dealerships.
The contingency has been approved by the Puget Sound Regional Council, which is administering some of the American Reinvestment and Recovery Act money, said Rick Olson, spokesman for the regional council.
However, the city has to submit more plans and applications before construction can begin, which should take two to three months, said Kasiniak.
“I can’t spend the money yet,” he said.
The initial project, dubbed Phase II, is expected to finish in October. The second project, paid for by leftover money, is called Phase III A.
Contingency plans are being dusted off with regularity as governments with stimulus dollars are finding bids well below estimates.
“This has been the case throughout the region,” said Olson. “A lot of the bids being awarded on stimulus projects came in lower.”
The money was approved by Congress and President Barack Obama in February to save jobs, jumpstart the faltering economy, and begin the process of long-term growth. The financial injection is expected to cost $787 billion through the next 10 years, according to the Congressional Budget Office.
The price of concrete has not fallen, said Tracy Bushnell, president of the Bushnell Group of Silverdale, but the price of fuel has dropped some and the price of steel rebar, used in concrete construction, has dropped precipitously.
The price of rebar is about a third of its price a year ago, Bushnell said.
But the price of materials is only part of the explanation.
“Most of those guys are willing to work for quite a bit less,” Bushnell said. “They are just hungry.”
Bushnell’s host of construction companies have avoided layoffs, but he said hours, benefits and wages have been reduced.
Poulsbo’s South Viking Avenue project isn’t the first in Kitsap to receive a windfall from underbid projects.
A King County project, underbid by about $6.5 million, resulted in a shift of an additional $3 million of stimulus dollars to a nearly $4 million South Kitsap Industrial Area access road project, Olson said.
And on Thursday, Bainbridge Island announced the accepted bid for its Blakely Avenue Road project left a $50,000 remainder of stimulus money.
