Two recent news items have driven home the point that American construction costs are out of control. The first is the agreement between the federal government and the states of New York and New Jersey to fund the Gateway project, at a cost of $20 billion. The second is the release of more detailed environmental impact studies for high-speed rail on the Northeast Corridor; I previously expressed tepidly positive sentiment toward the NEC Future concept, but now there are concrete cost projections: the only full HSR option, Alternative 3, is projected to cost $290 billion. As Stephen Smith noted on Twitter, Alternative 3 is twice as expensive per km as the mostly underground Chuo Shinkansen maglev. As such, I am going to ignore other issues in this post, such as whether to serve Hartford on the mainline or not: they are real issues, but are secondary concerns to the outrageous cost figures.
Although both Gateway and NEC Future have extreme costs – too high for me to be able to support either project – the causes of those high costs are different. Gateway includes not just a new tunnel across the Hudson but also substantial unnecessary scope in Penn Station South; however, I suspect that even if the scope is pared down to the minimum required to provide four tracks from Newark to New York, the budget would still be very high. The bare Gateway tunnel (including Penn South) is to my understanding $14-16 billion; the maximum cost that can be justified by the extra ridership, unless additional operating improvements (which can be done today) are in place, is about $7 billion. As with Second Avenue Subway, there is a real problem of high unit costs. I emphasize that there is too much scope in Gateway, but the scope alone cannot explain why 5 km of tunnel cost many billions, when expensive non-US projects such as Crossrail top at a billion dollars per km and the geologically more complex Marmaray tunnel cost (in PPP terms) about $400 million per km.
The situation with NEC Future is different, in two ways. First, if Gateway cuts a zero from the budget, I will consider it a solid project, perhaps even an inexpensive one given the wide river crossing. (For reference, in 2003 the projected cost was $3 billion). In contrast, if NEC Future cuts a zero from its budget, I will still consider it too expensive – perhaps worth it because of the benefits of HSR, but certainly too high to be built without further inquiry. $29 billion for 720 km is justified for a line with a fair amount of tunneling and entirely greenfield construction, whereas the NEC has long segments that are already nearly ready for HSR and requires very little tunneling.
But second, and more importantly, NEC Future’s unit costs are not high. Read appendix B.06, which discusses cost: on PDF-p. 28 it breaks down cost by item, and other than the tunnels, which at $400-500 million per km are several times as expensive as intercity rail tunnels usually are, the infrastructure items’ per-km costs are reasonable. And the NEC doesn’t require much tunneling in the first place: Connecticut may be hilly, but HSR can climb 3.5% grades and ride on top of the hills, and only in Bridgeport is tunneling really necessary. Make it perhaps 5 km of required tunneling, all around Bridgeport. When I said $10 billion would build full-fat HSR on the NEC, I assumed $200-250 million per km for the Bridgeport tunnel. I also assumed $750 million for new tunnels in Baltimore, whose cost has since risen to $4 billion in part due to extra scope (4 tracks rather than 2). So 2 extra billions come from more expensive tunneling, and 278 extra billions come from bloated scope. Perhaps a subset of the 278 comes from high unit costs for systems and electrification, but these are not the main cost drivers, and are also quite easy to copy from peer developed countries. In the rest of this post, I will document some of the unnecessary scope. I emphasize that while Alternative 3 is the worst, the cost projection for Alternative 1, at $50 billion, is still several times the defensible cost of improvements.
Let us turn to chapter 4, the alternatives analysis, and start on PDF-p. 54. Right away, we see the following wasteful scope in Alternative 2:
- Full four-tracking on the Providence Line, instead of strategic overtakes as detailed here.
- A bypass of the Canton Viaduct, which at a radius of 1,746 meters imposes only a mild speed restriction on trains with E5 and Talgo tilt capability, 237 km/h.
- An entirely new tunnel from Penn Station to Sunnyside, adding a third East River tunnel even though the LIRR is not at capacity now, let alone after East Side Access opens.
- A tunnel under Philadelphia, so as to serve the city at Market East rather than 30th Street Station.
- Two new HSR-dedicated tracks in New Jersey parallel to the NEC, rather than scheduling commuter trains on existing local tracks as detailed here.
- Two new HSR-dedicated tracks alongside much of the New Haven Line, even in areas where the existing alignment is too too curvy.
- Extensive tunneling between New Haven and Providence (see PDF-pp. 69-70 and 75), even in Alternative 1, even though HSR trains can climb the grades on the terrain without any tunnels outside the Providence built-up area if the tracks go west.
Alternative 2 also assumes service connecting New Haven, Hartford, and Providence, which I do not think is the optimal alignment (it’s slightly more expensive and slower), but is defensible, unlike the long proposed tunnels under Philadelphia, totaling around 30 km. The overall concept is also far more defensible than the tunnel-heavy implementation.
Alternative 3 adds the following unnecessary scope (see PDF-pp. 58 and 76-83):
- Full six-tracking between New York and Philadelphia and between Baltimore and Washington.
- Tunnel-heavy alignment options bypassing the New Haven Line, including inland options via Danbury or a tunnel across the Long Island Sound.
- The new Baltimore tunnels are longer and include a new Baltimore CBD station, where the existing station is at the CBD’s periphery.
- If I understand correctly, new platforms at New York Penn Station under the existing station.
- Tunnels under the built-up area of Boston.
According to the cost breakdown, at-grade track costs $20 million per km, embankments cost $25 million per km, elevated track costs about $80 million per km, and tunnels cost $400 million per km. When I draw my preferred alignments, I assume the same cost elements, except tunnels are cheaper, at $200 million per km. (I also add 20% for overheads on top of these base costs, whereas these documents add contingency on top of that.) This should bias the NEC Future toward above-ground options.
Instead, look at the maps in appendix A. Alternative 3 is PDF-pp. 76-81. The options for getting out of the New York urban area include an almost entirely tunneled inland alignment, and a tunnel under the Long Island Sound; making small compromises on trip time by using the New Haven Line, and making up time elsewhere by using better rolling stock, is simply not an option to the planners.
Let’s go back to Gateway now. Although the cost premium there is not as outrageous as for NEC Future, it is a good case study in what the US will fund when it thinks the project is necessary and when there is sufficient lobbying. Paris has the political will to spend about $35 billion on Grand Paris Express, and London is spending $22 billion on Crossrail and is planning to spend much more on Crossrail 2. Between Second Avenue Subway, the 7 Extension, Fulton Street Transit Center, the PATH terminal, East Side Access, and now Gateway, New York is planning to have spent $43 billion on public transit by the middle of next decade. And now people are talking about Second Avenue Subway Phase 2. The political will to build both rapid transit and HSR in the US exists; the government spends tens of billions on it. But due to poor cost effectiveness, what the US gets for its money is almost nothing.
The $20 billion that the federal government and both states are willing to set on fire for Gateway prove that, were there a plan to build HSR so that trains would go between Boston and Washington in three and a half hours on a budget of $10-15 billion, it would be funded. This is not a marginal case, where the best plan still elicits groans from anti-tax conservatives: those conservatives ride trains between New York and Washington and want them to be faster. Instead, it is purely about excessive costs. Gateway’s $20 billion could build the tunnel and also full HSR on the NEC, and the $290 billion that NEC Future wants to burn on HSR could build nearly a complete national HSR network, serving most metro areas above 1 million people. It’s no longer a question of political will; it’s purely a question of cost control. 95% cost savings are possible here, and this is the only thing advocates for better intercity rail in the US should be focusing on.