Bacon's Rebellion

Democracy Thrives in Sunlight

$5.15 Billion and Counting

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by

James A. Bacon
in

The Rail-to-Dulles project will cost about $5.15 billion, according to a presentation given earlier in May to the board of the Metropolitan Washington Airports Authority, reports the Times Community Newspapers. The highest official figure yet, the number is about 25 percent higher than preliminary estimates bandied about as recently as a year ago.

While the federal contribution will remained capped at $900 million and the state donation at $75 million, other costs are determined by fixed percentages. Under the latest scenario, Dulles Toll Road users are expected to fund 56 percent of the total cost, or $2.89 billion. (Fairfax County, Loudoun County and the MWAA will chip in the balance, about 25 percent of the total.)

What happens if the price tag escalates yet again? Everyone but the state and feds will have to pony up a larger share. Bottom line: Commuters using the Dulles Toll Road constitute the deep pockets that will cover 2/3 of any cost overruns. Fairfax County land-owners whose properties will soar in value will pay only a small fraction through a special tax district.

Let’s add up the pieces… The heavy rail construction project will be managed by the airports authority, which regards the Metro extension to Dulles International Airport as vital to its long-term interests but pays only 4.1 percent of the project cost… The MWAA board is stacked with a majority of non-Virginians who feel no pain if Virginia commuters get hosed… Commuters have absolutely no say-so in how the project is administered… A negotiated contract is likely to be granted to Bechtel, the company who brought Boston the Big Dig project…

I’m going way out on a limb here, but it looks like Dulles Toll Road commuters are going to get royally hosed. I’m glad I live in Richmond, not Northern Virginia.

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17 responses to “$5.15 Billion and Counting”

  1. Larry Gross Avatar
    Larry Gross

    I’m not a conspiracy person but sometimes when something appears to have more “legs” than it should, I start asking “what if” questions.

    In this case.. what if .. the powers that be.. are looking long/longer term for DC/the seat of our National government becoming mostly a “no-fly zone except for the powers-that-be?

    Outlandish? Perhaps.. but do note that the Feds are now also studying the idea of routing CSX trains that carry noxious/deadly cargoes on a brand new, to-be-constructed route that will also.. cost multiple billions of dollars…

    why not tell the public about the “plan”? well.. because it would then tip off our wild-eyed enemies hiding in the deep grass around Washington Reagan to hurry up and not lose their window of opportunity…

    JUST KIDDING FOLKS! and fodder for those who don’t think I’m kidding…. 🙂

  2. Anonymous Avatar
    Anonymous

    http://www.treehugger.com/files/2007/05/uk_finally_gett.php

    Trains are preferable to planes in my opinion; they’re greener, stations are in the centre of cities, unlike airports, and they’re often more comfortable. However, in the UK they’re also considerably slower, more expensive and less reliable. The rail network was once owned by the Government, but has since been privatised and split into countless smaller companies, all of whom seem to be competing in an incompetence competition.

    That’s why it’s fantastic news that the Government are to unveil a multi-billion pound rebuilding programme this summer. The good news is that 1,000 extra rail carriages have been ordered, and a £500m reconstruction of Birmingham’s New Street station will be approved, along with a £3.5bn overhaul of the Thameslink route through London.

    The bad news is that this will take a very long time, and while it’s happening fares will continue to shoot up much faster than inflation. It seems that my children, or their children may have a decent rail network, but that there’s not much chance of me getting to work on time regularly.

  3. Anonymous Avatar
    Anonymous

    Ten years ago, DRPT estimated that Rail to Dulles would cost $1.45 billion, which included a 30 percent contingency to cover any “unknowns.” Today’s revelation is more than 3.5 times that amount, and the first shovel full of dirt has not been moved.

    I think there are profound implications here. First, this project is under Virginia’s Public Private Transportation Act (PPTA). Clearly, the PPTA needs to be revisited. The private sector is not contribnuting a dime to this project, yet they are getting a sole source contract that is being negotiated in secret.

    Second, how could DRPT have gotten this project so horribly wrong? They claimed that the original cost estimate of $1.45 billion had an adequate contingency, yet they were off by a factor of at least 3.5, probably more. I think it is time for hearings.

    Third, Dulles Rail is likely dead. The Federal Transit Administration may very well pull out after seeing these numbers. What are we going to do now in the Dulles Corridor.

    Fourth, this project was championed and managed by the Warner Administration and now by the Kaine Administration. Both have refused to consider any alternative transit strategies for the corridor. It seems to me they ought to be held accountable for the way it has been mismanaged.

    Finally, Gerry Connolly, the current Chair of the Fairfax County Board of Supervisors, has put much of his political future on this project. Whether he can survive if Dulles Rail indeed collapses is an open question.

  4. admin Avatar
    admin

    http://www.ecssa.biz/credit-card-ratings.php

  5. Larry Gross Avatar
    Larry Gross

    There’s even more at stake in that the public’s trust in so-called “innovative” public-private partnerships and tolling and congestion pricing could be lost if this project becomes the poster child of how to do it wrong.

    Someone needs to step in and get this thing under control.. before it metastasizes.

    Is this where Kaine and company…earns the tax and spend moniker and in the process hands NoVa back to the Red party?

  6. E M Risse Avatar
    E M Risse

    Jim Bacon:

    I would not shed a lot of tears over raising the cost of using the Dulles Toll Road. There is a free ride for Dulles Airport users and a lot of the toll payers are Commuters.

    Commuters would benefit from incentives to live here and work / seek services here, not live here and work there and seek services somewhere else.

    Higher tolls are a way to make that happen.

    Larry:

    You may have a point about the no fly zone but National would go first by a long shot and then there would be real need for rail to Dulles, especially if Dulles and Andrews are combined.

    We note the National / Dulles relationship in our “All Aboard” column of 16 April.

    In that column and in other work we (Jim Bacon has noted this too) have suggested ways that Rail to Dulles could go a long way towards paying for itself.

    Then we could use those higher Tolls to pay for the infrastructure needed to create Balanced Communities in Eastern Loudoun and one in West Prince William.

    EMR

  7. Reid Greenmun Avatar
    Reid Greenmun

    Gee … I am surprised that anyone else would be surprised that these “projects” will cost many times more than what their proponents claimed.

    It is the oldest trick in the book – to gain “approval” low ball costs. Once “approved” and “committed” let the cost over runs begin.

    This is exactly WHY Public-Private Partnerships are such a dumb idea. Give me a Firm-Fixed Price (FFP)contract any day.

    If the private sector firm that bid the FFP and won fails to hold up their end of the contract – off to court we go.

    The Public-Private Partnerships con game is a foolish path for government to follow.

    But then – – what does government care? It is not their money they are spending!

    need more? Just raise taxes, tolls, and fees.

    What is the problem???

  8. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    The problem is that even a cash cow like Norva can simply run out of money. You guys up north support the entire state, and now you will support yourselves as well. And eventually you will be bailing out us poor saps down here in Tidewater.

    There was an article today in the local Pilot concerning per capita income. It seems the leaders are all a tizzy because we had a slight increase. But what is interesting were the two comments posted by the public.

    One pointed out that while per capita income is lower than the national average, the cost of living not including taxes was around 12 percent over the average. Imagine what happens when all these taxes are factored in. They also noted that the share of PCI made up of fixed income was increasing, indicating that the younger workers are leaving the area. A demographic shift to more retirees. It the picture getting clear?

    The second comment pointed out that the new tax on house sales, .40 per hundred would cause a major hardship on people who are here short term. Like the military.

    They buy a house for their three year tour, get orders out and a 300K house sale generates 12 grand in taxes. Then add in all the other costs.

    What wasn’t mentioned is the fact that the military has been for some time moving out of central Tidewater to less costly areas like NC. When this new tax kicks in, I can see military either increasingly moving to NC, or simply renting instead of buying. Since military pay is a large portion of the region’s GRP, such a move could have a very large impact on the financial plan for the HRTA.

    Which means they will have to get any shortfalls from somewhere, and you guys are the cash cow.

  9. Darrell -- Chesapeake Avatar
    Darrell — Chesapeake

    After reading the article again, with a perplexed feeling about the second comment, I realized they made a math error.

    The actual tax would be 1200, not 12000. Unless my calculator is less accurate than theirs.

    Still, the rest of my comments remain. The military has been a main component of this area’s PCI. Their current trend for moving to NC is not to be ignored.

  10. Larry Gross Avatar
    Larry Gross

    re: “Gee … I am surprised …”projects” will cost more than what claimed….
    It is the oldest trick in the book – to gain “approval” low ball costs.”

    hmmm.. are you saying that VDOT does not do this?

    I agree .. it’s the oldest trick in the book but it’s done by VDOT, WAMTA, PPTA, and in general, all sponsors of transportation projects.

    This is one of the problems that we have when we don’t have uniform and standard performance metrics from which to judge the merits of projects.

    PPTA – where the investor has to get their money back from TOLLs do have to be more careful – because there is a limit to how high a toll can be before people will refuse to pay it – and, in turn, the revenues will not return a profit and may actually result in the investor going broke.

    VDOT has not equivalent incentive. In fact, if a project ends up costing more, they just delay until they have enough money – even if in the process of delay, huge inflation costs also get lumped into the cost.

    This is why we have 6-year plans that don’t get built for 15 years and by the time they do, the project costs twice as much as estimated.

  11. Anonymous Avatar
    Anonymous

    Instead of the commuters on the Dulles Toll Road paying 2.89 billion in extra tolls for Metro, the money should be spent to add lanes and operate a Bus Rapid Transit system.

    Think of all the connecting toll roads we could build with that money. Traffic would flow more freely. Toll revenues would rise even further, allowing even more improvements.

    Why build this money losing rail line whose operating costs will have to be subsidized forever?

    This Metro extension is a fiscal black hole and Frank Wolf is a disgrace for continuing to push it.

  12. Ray Hyde Avatar
    Ray Hyde

    “Ten years ago, DRPT estimated that Rail to Dulles would cost $1.45 billion, which included a 30 percent contingency to cover any “unknowns.” Today’s revelation is more than 3.5 times that amount, and the first shovel full of dirt has not been moved. “

    My rule of thumb for cost esttmates is that it will cost 2 per cent of the cost of the project to generate a valid cost estimate. A valid cost estimate is plus or minus 15 per cent.

    Show me where someone spent that kind of money to generate cost estimates. And those are for NOW cost estimates, not cost estimates ten or twenty years in the future.

    You want an accurate cost estimate, with windows of accuracy?

    I’m for hire. But I seriously doubt anyone would want to hear the answers.

  13. Ray Hyde Avatar
    Ray Hyde

    “Trains are preferable to planes in my opinion; they’re greener, stations are in the centre of cities, unlike airports, and they’re often more comfortable. However, in the UK they’re also considerably slower, more expensive and less reliable.”

    I agree, and I ride the trains (when it makes sense).

    We need to recognize the advantages and disadvantages, and act accordingly.

  14. Ray Hyde Avatar
    Ray Hyde

    “Instead of the commuters on the Dulles Toll Road paying 2.89 billion in extra tolls for Metro, the money should be spent to add lanes and operate a Bus Rapid Transit system. “

    I do not have the figures to back up this statement. I do not think anyone does.

    I think that is a very serious problem.

    Overall, my sense is that Anonymous is correct.

    “The Metro extension is a fiscal black hole and Frank Wolf is a disgrace for continuing to push it.”

    However, I would (possibly) support a similar amount of money being spent to increase netero coverage where it makes sense.

    My guess is that a similar amount of money spent where it would make sense would be (for example) a single new station in Georgetown.

    Other options are possible. But whatever they are, the closer to the center (where they are most useful) the more expennsive they will be, and the smaller the base of political suport.

    I’mnot optimistic.

  15. Larry Gross Avatar
    Larry Gross

    does anyone remember what the original estimate for the Springfield Interchange was?

    I’m not apologizing neither for the METRO costs nor the way they intend to raise the revenue but they are separate things.

    Most proposed roads suffer from the same problem – namely – scope creep and inflation – both working in tandem can and do have profound impacts on the difference between intial estimates and final costs.

    The second issue – of what purposes should toll proceeds be used for (assuming the NET … AFTER the needs of the road itself are assured)….

    should those proceeds … be used for METRO… Bus Rapid Transit, connecting roads, Major new MEGA projects.. like the “Second Crossing” or the Western Transportation Corridor.. etc…???

    Would you judge the road projects in terms of net “congestion relief” or just “additional capacity”?

    What good is “additional road capacity” if .. the new road and the others that connect to it – remain gridlocked at rush hour?

    Are we using a double standard when we judge a very expensive METRO expansion to be not cost effective … while claiming that using that same amount of money for roads – would be cost effective?

    In the “for what it is worth” column – are we sure that the sole PURPOSE of the expansion is for Dulles? Isn’t it also to provide for TOD – transit-oriented-development – a land-use purpose?

    would a new road.. and/or connecting roads be useful for promoting/enabling the road equivalent of TOD?

    Would we call it ROD – road-oriented development”

    Is that an Oxymoron?

  16. Ray Hyde Avatar
    Ray Hyde

    “should those proceeds … be used for METRO… Bus Rapid Transit, connecting roads, Major new MEGA projects.. like the “Second Crossing” or the Western Transportation Corridor.. etc…???

    Would you judge the road projects in terms of net “congestion relief” or just “additional capacity”?”

    I don’t have any problem with that. But, as soon as you go down that route, then you are back to throwing money in a pot with some bureaucrat deciding how it is spent. You can no longer base your argument on the idea that the user should pay.

    Unless you want to consider the entire transportation system as a whole. Then you can figure out who uses what, to what extent, and what the value returned to society is in terms of their contribution to GNP or something.

    After you do that, you find out that Metro is primarily a peak load provider. You find out that Metro has the same problems with peak loads as roads do, or very similar. You find out that we build Metro, and use transit oriented development to justify it, while at teh same time we are decrying road oriented development as benefiting a favored few.

    So after you go through this exercise on a non judgemental, true-fact basis, you find out that the proper mix for autos and transit is 2% transit and 95% auto. Then what? You still have to find a way for the various users of the various features to pay something like their fair share.

    I just see a lot of circular and self aggrandizing logic here, by people who want to promote only one side of the issue.

    When we recognize the real problem for what it is, and focus on the actual correct solution, we may not like the answer.

    ————————

    What good is “additional road capacity” if .. the new road and the others that connect to it – remain gridlocked at rush hour?

    I don’t see any difference if you ask that question of the Orange line. If you don’t get congestion relief, then you can’t very well measure anything by that standard. After 30 years Metro has not provided net congestion relief, but it has provided more peak hour capacity.

    If added capacity is all you get, then that’s all you can measure by.

    What we need to ask is what happened to all that capacity? Why did we allow the additional land use “attractions” that created the giant public nuisance that we call congestion (and which ate up the new capacity we just provided)? Who are the roads serving, the people driving on them, or those that need the people at their destinations?

    Google seems to have answered that question for itself.

    It is one thing to have people pay for what they get but we need to ask what that means.

    So who is getting better service, the guy stuck in a traffic jam or the guy in Farmville? If you pay by the amount of road used, then the guy in Farmville would pay for the use of fifty miles of road in an hour, while the creepy crawly commuter would pay for the use of maybe only 20 miles in that same hour.

    But, whoever collects the money would get a lot more from the commuter route (because of more users), so he gets rewarded for providing inferior service.

    THAT, is the problem we need to fix.

    ——————————–

    If you don’t buy that argument, then think about what you call “net congestion relief”. Sure, the guy who pay the toll on the hot lane gets net congestion relief. What about everyone else? What about the guy who gives up and takes a lesser job closer to home? Where does he get his “net” in this congestion relief.

  17. Larry Gross Avatar
    Larry Gross

    METRO .. IS configurable to add more trains/substract trains and compress headways… etc…

    before it gets to the point where only new rail will work.

    In a similiar way – Congestion pricing could “manage” congestion

    On a related concept.. what is considered futuristic nirvana for roads?

    Isn’t it guid-by-wire vehicles operated by computers and sensors rather than occupants?

    Isnt’ that what give you the closer distances (headways) so that you can pack more vehicles on a stretch of road and get much closer to achieving that theoretically 2000 vehicles per hour?

    By gosh.. that sounds a LOT like transit or rail.. doesn’t it?

    Then we’d have all these SOLO SUVs … 3/4 empty cars.. being run on very expensive road lanes… at rush hour…

    so how about it… charge folks for the level of service that they want?

    If they want a cattle car on Metro at rush hour… or a SOLO SUV playing Bach at rush hour?

    My theory is that if/when Congestion Pricing is instituted on some roads – that the NEXT complaint is going to be that folks can buy ONLY a partial “short trip” .. because they then get dumped off the toll lanes onto non-toll lanes maxed to the eyeballs… and they’re going to demand that “something” be done like was done for the toll lanes…

    wrong?

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