SLO overpass project doubles in price. What will it cost and when will it be complete?
San Luis Obispo’s proposed Prado Road overpass project — a critical infrastructure link aimed to help alleviate traffic congestion as new housing projects are completed — will have a significantly higher price tag than preliminary estimates projected, the city said.
The project, which will connect Prado Road to Highway 101 with new northbound on- and off-ramps, was initially estimated to cost $25 million to $30 million, as of 2020, with hopes to begin building in 2022.
After further technical study, the project is now estimated to cost $67 million, and construction is targeted to begin in 2025 with a 2028 completion timeline.
City officials previously said the estimate could cover the full costs of the project, though they cited the potential for unforeseen funding needs after further planning and environmental studies of the site’s hydrology and potential for flooding.
The project cost, which will be shared between multiple government agencies, comes after further analysis of design issues, rising construction costs and additional planning steps, city officials say.
That leaves a funding gap of $33.4 million. San Luis Obispo will pursue federal allocations among other options, according to city public works director Matt Horn.
According to city officials, the Prado Road overpass will reduce traffic congestion and connect the east and west parts of San Luis Obispo.
The overpass will be constructed near the San Luis Ranch development, which is approved to feature 577 homes with hotel and commercial additions planned in the future.
Why did Prado Road overpass cost estimates change?
Horn said initial estimates for the Prado Road overpass project didn’t account for any soft costs — such as planning, right-of-way, design, environmental review and construction engineering. Plus, the type of structure needed has been more clearly defined, he said.
“Estimates prepared in 2017 early planning-level studies did not include the full cost of project,” Horn said.
Construction contingencies such as the realignment of Elks Lane, which needs to happen as part of interchange project, also have been factored in, Horn said.
“The type of structure required for the overcrossing at that time was not known,” Horn said. “Subsequent technical studies have confirmed that the interchange needs to be on columns to allow flood waters to pass under the interchange, which increases the cost considerably.”
Horn added that construction costs throughout California have substantially increased in recent years.
Construction timeline, funding
Overpass construction is anticipated to take 36 months, with an estimated completion date of summer 2028, though the preliminary timeline still requires Caltrans review and approvals, Horn said. That could affect the final schedule.
The project cost will be shared by the city of San Luis Obispo, San Luis Ranch developers, the San Luis Obispo Council of Governments and San Luis Obispo County.
Between their shared responsibilities, those agencies currently have funding in place for $26 million of the total cost.
Of the remaining $33.4 million, the city is seeking to fund the project “by aggressively pursuing state and federal grant opportunities which we expect will be available with the passing of the recent federal infrastructure bill, the Infrastructure Investment and Jobs Act,” Horn said.
“The city also plans to close this funding gap by using local funds, development impact fees, debt financing, as well as working with funding partners to meet their current fair share funding obligations based upon current construction estimates,” he added.
San Luis Ranch building is not constrained by the interchange schedule.
“None of the development in the (San Luis Ranch) specific plan is contingent on the interchange,” Horn said. “No portion of the development would be constrained by the interchange schedule.”
Southbound overpass ramps are not included in the current overpass concept, but could be added later.
San Luis Ranch progress
Initially, the city’s approval of the San Luis Ranch development plan called for a halt on building of new homes after the first 196 were constructed if the overpass and northbound bound ramp aren’t built before the second phase of houses were occupied.
In 2018, the San Luis Obispo City Council reconsidered its stance and allowed the project to move forward regardless of when the construction of the Prado Road overpass and northbound ramps are finished.
The consultant for Pismo Beach company Coastal Community Builders, which has partnered with Minnesota-based real estate firm Merced to build 198 homes at San Luis Ranch, said that lenders weren’t willing to finance the development with a risk of a hard stop on construction after the first phase.
The interchange would allow San Luis Ranch residents to easily access the Highway 101 freeway, and offer them another route to get to South Higuera Street from the city’s west side besides Madonna Road or Los Osos Valley Road.
Jake Hudson, the city’s former transportation manager, previously said the overpass “will allow acceptable levels of congestion and without it, we’ll have too much.”
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