Virginia officials are mounting a last-minute effort to rescue the troubled Dulles Corridor Metrorail Project from the brink of cancellation following a largely negative assessment of the project's viability by federal transportation officials.

In a Jan. 24 letter to Gov. Timothy Kaine (D), Federal Transit Administration (FTA) head James S. Simpson detailed multiple reasons why the agency believes the first phase of the proposed 23-mile, $5.1 billion extension "does not appear to be a prudent investment" for $900 million in New Starts funding requested by the Metropolitan Washington Airports Authority (MWAA), the lead agency for the project.

The New Starts funding is the keystone of a complicated funding strategy that would allow final design and construction of the initial $2.7-billion extension from the existing East Falls Church Metrorail station to Reston to get under way with a target completion date of 2013. Phase Two would continue the extension to Dulles International Airport and eastern Loudoun County.

MWAA had also planned to tap revenue from the Dulles Toll Road, which it operates along with Dulles International Airport, and contributions from local governments.

Part of Northern Virginia's transportation plans for more than 40 years, the Dulles Metrorail Project has experienced multiple delays and setbacks amid disagreements on issues such as funding and its route through the densely developed Tysons Corner area. Escalating costs were cited as reason behind MWAA's decision to take the extension above ground, rather than a tunneling option favored by many local citizens groups.

Despite efforts to make the project more financially palatable, including trimming $250 million from the budget at the FTA's request in August, Simpson apparently remains unconvinced that all concerns have been adequately addressed.

His letter to Kaine noted that even if MWAA was able to upgrade the project's existing "medium-low" New Starts rating, "the sheer number and magnitude of the current Project's technical, financial, and institutional risks and uncertainties are unprecedented for a candidate New Starts project...and lacking transportation benefits commensurate with the cost."

Simpson's concerns include a management arrangement that calls for MWAA to oversee design and construction, then turn the extension over to the Washington Metropolitan Transit Administration (WMATA), which operates the Metrorail system.

He also cited MWAA's limited experience with large, complex transit projects, increasing the risk of cost escalations and schedule delays. The Authority's $1.6 billion design/build contract with Dulles Transit Partners (DTP), a consortium co-owned by Bechtel Infrastructure, Inc. and Washington Group International, is the single largest contract of its kind in New Starts history, Simpson said.

Simpson also expressed doubts whether revenue from the extension will be enough to offset operation and maintenance costs. Noting that WMATA already faces significant, unresolved capital funding needs for maintaining its existing system and infrastructure, Simpson said that, "the proposed extension to Metrorail may pose serious financial and operational challenges, and further strain the system as a whole."

In a statement, WMATA General Manager John Catoe reaffirmed the agency's longstanding support for the project, and vowed to continue working with Virginia officials and MWAA to move it forward.

"We believe that this corridor needs this rail extension to meet the growing travel demand in the corridor and the region," Catoe said.

Kaine and MWAA expect to deliver a formal response to the project concerns by Friday to U.S. Transportation Secretary Mary Peters, who will also address project and political leaders' allegations that Simpson's criticisms contradict previous agency correspondence, reports, and other communications that presented more positive evaluations of the project's viability.

Simpson countered in a statement that, "No one associated with the Dulles Corridor Metrorail Project should be surprised by its escalating costs and risks. FTA and MWAA have been in communication regarding these challenges."

Simpson also cited a well-publicized July 2007 assessment by the Dept. of Transportation's independent Inspector General that urged the FTA to use "extra vigilance" in addressing these concerns.

Still, DTP's communications and outreach spokesperson Howard Menaker remains baffled by the agency's apparent shift in position.

"Seeing how the project has proceeded so far, we don't understand the FTA's eleventh-hour decision to raise issues in areas where they've already granted approval," he said, citing the agency's previous endorsement of MWAA as the project's funding grantee, plus the $140 million of federal funding that has already been invested in planning and preliminary design.

Stated Ginger Evans, former aviation managing principal with Carter & Burgess, which prepared a report assessing a tunnel option: "If FTA does not support this vital rail link from the nation's capital to its international air travel terminal at Dulles, which serves the capitals of the world, it is indeed a sad commentary on the prospects for public investment in America's aging and undersized infrastructure."

Despite the concerted effort by Kaine and others, the possibility of no federal funding for the project has given rise to speculation that Virginia might turn to the private sector to close the funding gap, either through a public-private partnership or by privatizing the Dulles Toll Road.

Meanwhile, DTP and MWAA are discussing modifying their design/build contract, which contained a cost escalation clause if the project had not received federal approval by Feb. 1.

Yet even with the looming uncertainty, Menaker remains optimistic. "Given a close examination of issues and the Governor's expected response to the FTA, we're optimistic that the project will move forward," he says. "We're ready to build it."