A project to replace Muni rail tracks and to seismically upgrade the Twin Peaks Tunnel will have to start again from square one if transit officials on Tuesday decide to terminate a contract with the current contractor, NTK Construction, Inc.

The San Francisco Municipal Transportation Agency will owe the contractor $16.2 million for materials purchased, indirect costs due to the delay, a termination claim, and work completed already by the contractor.

The project has seen a number of start dates over the last two years, but the major portions of the work never begun inside the tunnel.

According to the contract, the contractor was to replace ballast, ties, rail fixation, rail and drainage between the tracks. NTK was also supposed to make seismic upgrades to the Forest Hill and the Old Eureka Valley stations.

NTK was originally supposed to perform the work during a 21-weekend closure of the tunnel between West Portal and Castro stations, but a staff report from the SFMTA said both the transit agency and contractor could not agree on new costs associated with a new schedule.

After the SFMTA Board of Directors awarded the contract to NTK in April 2016, the transit agency said having a large number of closures in short durations was not in the best interest for Muni riders and the community affected by the closures after a recent experience with the Sunset Tunnel Trackway Improvement Project.

The SFMTA would need to provide bus bridges for every of the 21 weekends, allow time for the contractor to prepare and perform the work, and to also allow time for transit staff to test trains through the subway for the following Monday revenue service, the report said.

Both the contractor and the SFMTA tried to work out a new schedule, which included closing the subway five times with each closure lasting for 14 days.

The changes, though, increased the contract amount total to $48 million and the number of days to complete the project from 460 to 807 days. The staff report recommended to terminate the contract, and to instead put the contract out to rebid.

Sunset Tunnel Trackway Improvement Project

The SFMTA is on the hook for paying $4 million to ProVen Management, Inc., for the Sunset Tunnel Trackway Improvement Project because of delays to the project.

According to the SFMTA staff report, the transit agency said the project was delayed by a total of 892 days. The SFMTA said it was responsible for a majority of the delays, with the exception of 79 days where both the transit agency and contractor were responsible for the delays.

During work of the project, crews discovered additional work was needed to design and install new conduits and raceways, and replace parts of the traction power system that were corroded, all of which delayed the project by 514 days.

Additionally, noise complaints from residents halted work, and the transit agency did not provide the contractor access to the Sunset Tunnel to perform work during scheduled closures because of conflicts with special events, and the “limited capabilities of SFMTA Operations to staff the shutdowns,” causing an additional delay of 338 days.