America’s transit industry has been heavily criticized for spending so much on construction. Yet the industry continues to roll up cost overrun after cost overrun for projects that should have been too expensive to build in the first place.
VTA’s planned single-bore tunnel into downtown San Jose. Figure by VTA.
Take, for example, the BART line to San Jose, which is being planned and built by the Santa Clara Valley Transportation Authority (VTA), which has never displayed much competence in the past. Rather than cut and cover two small tunnels into downtown San Jose, which is the usual practice, VTA wants to bore one gigantic tunnel three to four stories underground. The 6-mile line was originally projected to cost $4.1 billion, but last October the Federal Transit Administration (FTA) announced that it expected the cost to be $9.1 billion, or $1.5 billion a mile, and the agency expressed doubts that VTA had the funds to cover this cost overrun.
Publicly, VTA’s first response was to deny that the FTA’s estimates, which took into account recent labor shortages and supply-chain difficulties, were correct. Privately, it was revealed last week, VTA officials and San Jose’s mayor tried to cover up the cost increase. Among other things, they lobbied the FTA to not release its latest cost projection.
Despite, or perhaps because of, the controversy, VTA’s board awarded the first contracts for the construction project. As one critic tweeted, this award was made despite the huge uncertainties that remain about the project. Most Silicon Valley transit advocates actually oppose the BART extension, saying it is diverting resources away from projects that are much more cost effective at moving people. Of course, VTA’s goal is to spend so much money that politicians won’t deny the funds needed to complete the project.
San Jose BART’s history isn’t much different from the Honolulu rail project, which was supposed to cost $5.1 billion at time of approval but now is expected to cost (if it is ever completed) well over $12 billion, or more than $600 million a mile for the elevated project. In that case, too, the FTA had projected the cost increase well before Honolulu Authority for Rapid Transportation (HART) was willing to admit it.
Like VTA, HART attempted to cover up the costs. The San Jose BART line is expected to be four years late, but HART has hat beat: its rail line will be at least 12 years late, and that’s for a truncated version that is estimated to cost $9.1 billion. Unlike VTA, the cost increases weren’t due to COVID supply issues but simply to HART’s incompetence.
Then there’s Maryland’s Purple Line, whose construction was put on hold when the contractor discovered the state had drastically underestimated costs. The project was supposed to cost $2.2 billion, but Maryland’s Governor Hogan said he would approve it only if the cost could be reduced below $2.0 billion. The state transportation department dutifully but unrealistically reduced its estimates. Construction is expected to resume this spring at a cost of $2.75 billion.
Bad transit news seems to come in pairs as the story of Minneapolis’ Southwest light-rail line sounds very similar to the Purple line. Projected to cost $1.25 billion in 2011, climbing above $2.0 billion by 2018. I seem to remember a governor also stating he would support the project only if the cost could be kept under $2 billion, so it went through. The project has suffered construction difficulties so it is no surprise that costs are now expected to reach $2.75 billion. The project will also be at least four years late.
Plenty of other transit agencies are building projects with huge cost overruns. Overruns in Seattle, for example, are averaging 86 percent.
Rather than be alarmed by high costs and cost overruns, politicians are throwing more money at transit. In 2020, the FTA gave out slightly less than $2 billion in transit capital grants. This year, thanks to the recent infrastructure bill, it has nearly $4.5 billion.
Members of Congress who voted for these funds no doubt thought they would see more transit projects built with them. Instead, it is likely that the cost overruns on existing projects will suck up a lot of the increase. Overall, project costs are rising approximately as fast as Congress shovels the money out, so the main beneficiaries of the increased spending are the engineering and construction firms that design and build the projects.
Part of the problem is that there are a limited number of people with the experience to plan and build huge transit projects. Unlike highways, which are pretty simple, rail transit lines are complicated and must be built with greater precision. Increased funding does not provide increased expertise, so more projects are going to be overpriced. Congress doesn’t seem to care.
The bottom line is that no one should have any doubt why American transit agencies spend so much more on construction. The simple answer is: because they can.
The old saying in sales was, “Find out how much money they have and get it all.” Public transit officials add, ” … and then some. There’s always more.”
Let’s not overlook that FTA is at least as culpable as transit agencies. Every project for which FTA now finds a gross increase in cost-to-complete was approved by the same FTA at the grossly underestimated cost in the first place. One might say FTA is more culpable because FTA staff be able to spot “ strategic misrepresentation”.
”
Part of the problem is that there are a limited number of people with the experience to plan and build huge transit projects. Unlike highways, which are pretty simple, rail transit lines are complicated and must be built with greater precision. Increased funding does not provide increased expertise,
” ~anti planner
It sounds like they’re ignoring the problems with the mythical man month. Or, as most people know it, too many cooks in the kitchen.
Whenever transportation infrastructure is financed thru a myriad of various financial methods there’s the invitation for graft, waste, fraud and just plain fiscal incompetence. Also when projects derived from a multitude of financial sources, you run the risk of the source depleting or funding shortages along one of those revenue streams….
Thus happens in movies production. It’s why George Lucas shot Return if thevJedi. Under the false title blue harvest. When u expect expensive or quality things that cistca dollar end up two dollars.
The issue with milking car drivers as a source of revenue..to pay for transit….
1: It sends the wrong political message, in essence, they’re saying/admitting “We need auto drivers” to spend as much money as possible so we can stay afloat
2: If they succeed in reducing drivership rates, it doesn’t leave much for transit if revenue declines.
3: Transit infrastructures overall maintenance debacle is not result to lack of funds. States pilfer 20 percent of gas taxes and highway toll, other user fee revenues to pay for non-highway activities. If ticket fares and tax revenue and Highway user fees are insufficient to pay for it’s upkeep……..what more can we do?