Higher cost projections for new light rail lines

Some good news and some not-so-good news for Metro.

The Metropolitan Transit Authority got federal permission last week to move forward with preliminary engineering on its planned North and Southeast lines, work that was halted in November while Metro revised its funding applications to reflect the switch from Bus Rapid Transit back to light rail.

Just a brief interruption to say that this item did not appear to make the news anywhere - not in the Chron, not on Metro's site, nowhere I can find. The last news I'd heard was from a month ago when the FTA met with a bunch of local honchos and said some nice things about the current state of Metro's plans. This is very nice to hear, of course, but seeing it mentioned in an as-you-know kind of way was a bit jarring, and made me think I'd missed something.

That was good news. The bad news was the soaring cost estimates that came with it.

The Federal Transit Administration, using data provided by Metro, said in its letters that the estimated cost of the North line, which would run 5.5 miles from north of downtown to Northline Mall, has risen to $677 million, from $276 million. The Southeast Line, 6.8 miles from downtown to Palm Center, has risen to $664 million, from $158 million, the FTA said.

By comparison, the 7.5-mile Main Street line cost $324 million and needs $104 million in new rail cars and improvements.

The FTA also sent a review of Metro's proposals that attributes the increases largely to the higher costs of light rail than BRT, which uses special buses running on guideways. The increases also reflect light rail's higher ridership projections, extended through 2030, which would require 29 new rail cars and other infrastructure.

Then there are the rising costs of fuel, labor and construction materials. Although Metro's estimates assume 3.5 percent annual inflation, the FTA reviews describe this as optimistic and say Metro should "refine and update" its figures.

Letters from FTA regional administrator Robert Patrick advise Metro that the go-ahead on engineering is not a promise to fund final design or construction, and that Metro must still fulfill all federal requirements. Both lines are rated "medium" as candidates for the funding, FTA said.

"We are excited about the positive report," Metro said in a statement. "A 'medium' rating endorses the North and Southeast Projects as competitive for federal New Starts funding."

I think this may look a bit more dramatic than it is. As BRT is less expensive than LRT, which is why Metro fell back to that when FTA funding was unavailable due to insufficient ridership projections, what much of this really represents is a return to square one. A better comparison, if we're trying to make a statement about genuine cost increases, would be to the original estimates for LRT, if we ever had them. I should also note that cost increases due to an expectation that even more people will use this service than we first thought is to my mind a good problem to have.

Bill King, who could be the city's next mayor -- and appoint five of Metro's nine board members -- says he can't see how Metro can afford its ambitious plans, which include three other light rail lines, two or more commuter rail lines, an intermodal terminal on the north side and a major expansion of bus service.

Numbers released by Metro varied. In February, the agency said that "by an order of magnitude," not exactly, all five planned light rail lines would cost about $2 billion, shared equally between Metro and the FTA, with the North and Southeast lines accounting for $500 million of that.

A month earlier, King says, Metro told him that the two lines would cost $854 million out of a $2.2 billion total. "A million here, a million there ... ," he quipped.

That's an interesting position for a guy who not too long ago was advocating for Metro to abolish the fare box to take. Obviously, we need to understand why the cost estimates have increased, and we need to fully understand how these costs can be paid, but my argument is that if one of the factors here is heightened demand, then we really need to figure out how to make this work.

One more thing:

But just remember that transit, unlike some toll roads, loses money. Little if any of this would come from profits from transit service itself.

Untolled highways don't make any money, either, and their costs can dramatically increase over time, too. We find a way to pay for them anyway.

Posted by Charles Kuffner on March 31, 2008 to Planes, Trains, and Automobiles