Quote:
Originally Posted by valhalla
5 billion dollars for 10 miles of rail?? Can someone please explain to me how light rail can cost 500 million dollars per mile? I'm not being facetious, like I would honestly appreciate an explanation. I want to see light rail in austin more than anything but these numbers make it look like officials are skimming more off the top than a Zairian kleptocracy.
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1. Inflation has been high the past couple of years (historically high, highest in almost 40 years). It's expected that will continue for a while, and ATP has to plan as if it will. Construction won't start for years, so this will continue to compound.
Worse, the inflation number you're used to seeing is the consumer price index. Costs for construction or materials can be even higher.
2. Interest rates are high, so the cost of debt financing has increased.
3. It's a tight labor market. Everywhere, but especially in Austin for construction labor. The construction of the rail will be competing with all sorts of other projects, including TxDot's I35 expansion.
4. Property costs in Austin have increased significantly, increasing the costs for all the property that needs to be acquired for right of way, park and rides, and the maintenance yard. It's also a bit of a vicious cycle, as decreasing the line length has forced the later two elements to move further into the city, increasing their costs.
5. The 5B number includes a huge 40% contingency, which the FTA is now requiring/heavily suggesting. Which means, to their best estimates, it's "only" a 3.5B system.
6. Several of the costs don't (or imperfectly) scale with mileage (that maintenance yard, buying trains, etc.) so a per-mile cost can be misleading. As the length has had to be cut back, those costs become a greater percentage of the total.