Category: Construction Costs
The Invention of the Traditional System of Project Delivery
In the Sweden case, I contrasted the emerging UK-influenced norms of infrastructure project delivery, which I called the globalized system, with the way Nordic procurement was previously done, which I called the traditional system. This explained Nordic trends well, in which Stockholm went from having construction costs so low in the second half of the 20th century they were at times even lower than those of Spain to having rather average costs for Europe. But elsewhere, calling the set of good project delivery practices reliant on an active, expert, apolitical public sector traditional ended up obscuring too much. In the United States, for one, the traditional practices did not work like that at all. In Italy, the project delivery practices are thoroughly traditional in the Nordic sense, but go back to mani pulite in the 1990s.
That said, this procurement system represents an evolution of prior norms of state-led planning, and is less of a break from them than the globalized system is. It’s best viewed as a system based on transparency and good government insights from the second half of the 20th century, rather than on giving up on good government and privatizing to the private sector as the globalized system does. In either case, it has little to do with traditional or emerging American practices, the former based on the good government practices of the early 20th century and the latter an adaptation of the globalized system in an even worse context. Regardless, its benefits are extensive, with interviewees in New York and increasingly London finding various wastes in the process of their own project delivery that can double the cost or even worse.
Good procurement practices: a recap
Good infrastructure megaproject delivery – at least subways, but also likely road tunnels as far as we can tell from small data – requires an active public sector that can supervise consultants and contractors, learn within its own institutions, and assume risk.
In Southern Europe today, and in the Nordic countries until recently, this means the following:
- Technical scoring: infrastructure contracts must be awarded primarily on the technical score of the proposal (50-80% of the weight of the contract) and not on the cost (maximum 50%, ideally about 30%)
- Itemized costs: contracts must have a bill of items, priced based on transparent lists produced by the state, with change orders using the same itemized list to reduce conflict
- Separation of design and construction into two contracts (design-bid-build), rather than bundling into design-build contracts
- Public-sector planning, with the decisions on the type of project and technology made before any designers are contracted
- Flexibility for the builders to vary from the design, so that in practice the design only covers 60-80% of the design, as 100% design is impossible underground until one starts digging
- Moderate-size contracts (tens of millions of dollars or euros to very low hundreds), to allow more contractors to compete
- Limited use of consultants, or, if consultants are used, regular public-sector supervision
This is not entirely in pure contrast to the globalized system, which centers the needs of large multinationals. The large multinationals prefer large-size fixed-price design-build contracts with early contractor involvement and extensive reliance on consultants, but they also prefer technical scoring, which makes them feel like racing to the top rather than the bottom.
This is also not always traditional. In the United States, for example, there is no tradition of technical scoring, itemization of costs, or any flexibility for builders to vary from design. This is because American procurement laws and traditions go back to the Progressive Era, when lowest-bid contracts were thought to be a good government innovation; as it is, American law permits technical scoring as the law states lowest responsible bid, but it’s almost never used, and never to the full extent, so the tradition remains lowest-bid.
The evolution of project delivery in Scandinavia
Traditional Nordic subway infrastructure project delivery was largely in line with the above outline of good practices. However, two variations are notable, one small and one large.
The small variation is that Nordic governments have been happier to outsource operations and even some construction design to private contractors than governments in the rest of Europe; in Finland, project delivery was largely done by private consultants, but under public-sector supervision, with institutional knowledge retained in government agencies even in an environment of privatization.
The large variation is that the risk allocation did not, in practice, permit flexibility for the building contractors. The traditional implementation of design-bid-build assigned the risk to the build contractors if they made any change to the design and to the design contractors if the build contractors made no such changes. This led to defensive design: the build contractors never varied from the design, and the design contractors knew this and prescribed some overbuilding to account for risks that could be discovered later in the process, for example grouting tunnels that might not be necessary. It’s this conflict, driving up costs in Oslo, that contributed to the acceptance of design-build in Scandinavia.
But it wasn’t just the failure of one of the features of the otherwise good project delivery system. It was British soft power, and the perception that English-speaking multinational consultants with extensive experience in megaprojects that use consultants knew better than the Swedish or Danish or Finnish or Norwegian state. There was limited attention in the Nordic procurement strategy to largely traditional Germany, which does not exert this soft power on countries that are richer than Germany and speak English and not German, let alone Southern Europe, which Northern Europe constantly looks down on.
In this sense, Sweden has not been too different from France. France, too, began implementing globalized system features under the soft power of English-speaking multinationals; for all of their frothing at the mouth about France’s superiority to the UK and US, the top 1% of France wish they were the top 1% in a higher-inequality country like the US, and are happy with privatization. And in both France and Sweden, the process is being halted as its poor results are visible; Swedish public transport watchers are already noticing how the emerging system is based on the needs of large multinationals and not those of society, and in France, the delivery of Grand Paris Express in a UK/US-style single-purpose delivery vehicle (SPDV) turned into a permanent institution to build suburban rail extensions throughout France.
The invention of itemization in Italy
Italy is the only case I’m aware of in which there was a large systemic reduction in the cost of subway construction. This occurred in the environment of mani pulite, in which outrage over the endemic corruption of the Cold War-era Italian state led to massive, mediagenic investigations, forcing former Prime Minister Bettino Craxi into exile, putting half of parliament under indictment, and destroying all major political parties. The remnants of the communist party (PCI), the largest and most moderate in Europe, formed the new center-left, the present-day Democratic Party (PD); on the right, the dominant element in the coalition was previously nonpartisan media mogul Berlusconi and later the coalescence of fringe far right parties into more serious conservative blocs, currently Fratelli d’Italia (FdI).
In Italian historiography, mani pulite is rather bittersweet. Berlusconi himself was openly corrupt, and used his media influence to shut down the investigations before they could get to him as he entered politics, since he too had been involved in the corruption of the 1980s, including influence peddling with Craxi. I analogize it to civil rights in the United States, in which by the late 1960s, early-1960s optimism about ending racism was dashed, and the civil rights laws and court rulings led to a backlash symbolized by the election of Richard Nixon on a law-and-order platform. But just as the racial wage gaps in the United States markedly fell in the 1960s-70s, so did Italian infrastructure corruption levels markedly fall in the 1990s due to the legislation passed in the wake of mani pulite.
The history of itemization in Italy goes back to those post-mani pulite reforms. By the 1990s, it was clear that fighting corruption required extensive sunshine, as well as a proactive apolitical state willing to put people in prison; this was the same era of prosecutors and judges putting Cosa Nostra leaders in prison, with some being assassinated during trial and many of the others having to hide out for the duration. One can’t privatize the state in face of the mafia. The upshot is that instead of American-style rules and traditions aiming to solve the problems of the late 19th century, Italian public procurement law aims to solve those of the late 20th century.
Implementing good project delivery practices
If there’s a common theme to the various elements of Southern European (and largely also French and German) urban rail procurement norms, it’s that they require an expert civil service. Teams of engineers, planners, architects, procurement experts, and public-sector project managers are required to manage such a system, and they need to be empowered to make decisions.
This empowerment contrasts with American public-sector norms, in which to a small extent in law and to a very large extent in political culture, civil servants are constantly told that they are dregs and cannot make any decisions. Instead, they are bound by red tape requirements that can only be waived if a political appointee wants to take the risk. The United Kingdom is similar, except without the political appointees, so ministerial approval is required. Everything below that level is designed to avoid change and avoid any decisionmaking. The role of the public-sector engineer in these societies is to prostrate before the political advisor who went to the right elite universities and went through the right pipelines. The idea of listening to engineers and planners is denigrated as siloing, whereas generalist managers with little knowledge are elevated to near-godhood. Much of the growth of the globalized system in these environment comes from the fact that in privatizing planning to multibillion-dollar design-build contracts, the only public-sector decisions are made at the level of a top political leader, such as a governor, without having to deal with civil servants.
In contrast, it is less important how many civil servants are hired to supervise contracts than that they have the authority to make judgment calls and that they do not have to answer to an overclass of generalist managers. Italy and France use very large bureaucracies of planners and engineers at Metropolitana Milanese and RATP respectively, but Nordic planning always used smaller teams with more use of consultants under client supervision. In this sense, the fact that a Swedish procurement civil servant who didn’t know me was willing to tell me on the record that functional procurement doesn’t work speaks louder than any organization chart; in the United States, civil servants would never criticize their own organizations’ plans so openly.
Once the civil servants can make decisions and supervise contractors, they can look at bids and score them technically, or delve through itemized lists, or oversee changes and make quick yes-or-no decisions as the builders are forced to vary from the design. With such tight project management, they do with one dollar what 10 years ago New York procurement did with two, and what today New York does with more than two, making this the most significant single intervention in reducing infrastructure construction costs.
Reasons and Explanations
David Schleicher has a proposal for how Congress can speed up infrastructure construction and reduce costs for megaprojects. Writing about what further research needs to be done, he distinguishes reasons from explanations.
I have argued that many of the stories we tell about infrastructure costs involve explanations but not reasons. There are plenty of explanations for why projects cost so much, from too-deep train stations to out-of-control contractors, but they don’t help us understand why politicians often seem not to care about increasing costs. For that, we need to understand why there is insufficient political pressure to encourage politicians to do better.
I hope in this post to go over this distinction in more detail and suggest reasons. The key here is to look not just at costs per kilometer, but also costs per rider, or benefit-cost ratios in general. The American rail projects that are built tend to have very high benefits, to the point that at normal costs, their benefit-cost ratios would be so high that they’d raise the question of why it didn’t happen generations ago. (If New York’s construction costs had stayed the same as those of London and Paris in the 1930s, then Second Avenue Subway would have opened in the 1950s from Harlem to Lower Manhattan.) The upshot is that such projects have decent benefit-cost ratios even at very high costs, which leads to the opposite political pressure.
Those high benefit-cost ratios can be seen in low costs per rider, despite very high costs per kilometer. Second Avenue Subway Phase 1 cost $6 billion in today’s money and was projected to get 200,000 daily riders, which figure it came close to before the pandemic led to reductions in ridership. $30,000/rider is perfectly affordable in a developed country; Grand Paris Express, in 2024 prices, is estimated to cost 45 billion € and get 2 million daily riders, which at PPP conversion is if anything a little higher than for Second Avenue Subway. And the United States is wealthier than France.
I spoke to Michael Schabas in 2017 or 2018 about the Toronto rail electrification project, asking about its costs. He pointed out to me that when he was involved in the early 2010s studies for it, the costs were only mildly above European norms, but the benefits were so high that the benefit-cost ratio was estimated at 8. Such a project could only exist because Canada is even more of a laggard on passenger rail electrification than the United States – in Australia, Europe, Japan, or Latin America a system like GO Transit would have been electrified generations earlier, when the benefit-cost ratio would have been solid but not 8. The ratio of 8 seemed unbelievable, so Metrolinx included 100% contingency right from the start, and added scope instead of fighting it – the project was going to happen at a ratio of 2 or 8, and the extra costs bringing it down to 2 are someone else’s revenue.
The effect can look, on the surface, as one of inexperience: the US and Canada are inexperienced with projects like passenger rail electrification, and so they screw them up and costs go up, and surely they’ll go down with experience. But that’s not quite what’s happening. Costs are very high even for elements that are within the American (or Canadian) experience, such as subway and light rail lines, often built continuously in Canadian and Western US cities. Rather, what’s going on is that if a feature has been for any reason underrated (in this case, mainline rail electrification, due to technological conservatism), then by the time anyone bothers building it, its benefit-cost ratio at normal costs will be very high, creating pressure to add more costs to mollify interest groups that know they can make demands.
This effect even happens outside the English-speaking world, occasionally. Parisian construction costs for metro and RER tunnels are more or less the world median. Costs for light rail are high by French standards and low by Anglosphere ones. However, wheelchair accessibility is extremely expensive: Valérie Pécresse’s plan to retrofit the entire Métro with elevators, which are currently only installed on Line 14, is said to cost 15 to 20 billion euros. There are 300 stations excluding Line 14, so the cost per station, at 50-67 million € is even higher than in New York. In Madrid, a station is retrofit with four elevators for about 10 million €; in Berlin, they range between 2 and 6 million (with just one to two elevators needed; in Paris, three are needed); in London, a tranche of step-free access upgrades beginning in 2018 cost £200 million for 13 stations. This is not because France is somehow inexperienced in this – such projects happen in secondary cities at far lower costs. Moreover, when France is experimenting with cutting-edge technology, like automation of the Métro starting with Line 1, the costs are not at all high. Rather, what’s going on with accessibility costs is that Paris is so tardy with upgrading its system to be accessible that the benefits are enormous and there’s political pressure to spend a lot of money on it and not try saving much, not when only one line is accessible.
In theory, this reason should mean that once the projects with the highest benefit-cost ratios are built, the rest will have more cost control pressure. However, one shouldn’t be so optimistic. When a country or city starts out building expensive infrastructure, it gets used to building in a certain way, and costs stay high. Taiwanese MRT construction costs began high in the 1990s, and the result since then has not been cost control pressure as more marginal lines are built, but fewer lines built, and rather weak transit systems in the secondary cities.
Major reductions happen only in an environment of extreme political pressure. In Italy, the problem in the 1980s was extensive corruption, which was solved through mani pulite, a process that put half of parliament under indictment and destroyed all extant political parties, and reforms passed in its wake that increased transparency and professionalized project delivery. High costs by themselves do not guarantee such pressure – there is none in Taiwan or the United Kingdom. In the United States there is some pressure, in the sense that the thinktanks are aware of the problem and trying to solve it and there’s a decent degree of consensus across ideologies about how. But I don’t think there’s extreme political pressure – if anything the tendency for local activist groups is to work toward the same failed leadership that kept supervising higher costs, whereas mani pulite was a search-and-destroy operation.
Without such extreme pressure, what happens is that a very strong project like Caltrain or GO Transit electrification, the MBTA Green Line Extension, the Wilshire subway, or Second Avenue Subway is built, and then few to no similar things can be, because people got used to doing things a certain way. The project managers who made all the wrong decisions that let costs explode are hailed as heroes for finally completing the project and surmounting all of its problems, never mind that the problems were caused either by their own incompetence or that of predecessors who weren’t too different from them. The regulations are only tweaked or if anything tightened if a local political power broker feels not listened to. Countries and cities build to a certain benefit-cost ratio frontier, and accept the cost of doing business up to it; the result is just that fewer things are built in high cost per kilometer environments.
Against State of Good Repair
We’re releasing our high-speed rail report later this week. It’s a technical report rather than a historical or institutional one, so I’d like to talk about a point that is mentioned in the introduction explaining why we think it’s possible to build high-speed rail on the Northeast Corridor for $17 billion: the current investment program, Connect 2037, centers renewal and maintenance more than expansion, under the moniker State of Good Repair (SOGR). In essence, megaprojects have a set of well-understood problems of high costs and deficient outcomes, behind-the-scenes maintenance has a different set of problems, and SOGR combines the worst of both worlds and the benefits of neither. I’ve talked about this before in other contexts – about Connecticut rail renewal costs, or leakage in megaproject budgeting, or the history of SOGR on the New York City Subway, or Northeast Corridor catenary. Here I’d like to synthesize this into a single critique.
What is SOGR?
SOGR is a long-term capital investment to bring all capital assets into their expected lifespan and maintenance status. If a piece of equipment is supposed to be replaced every 40 years and is currently over 40, it’s not in good repair. If the mean distance between failures falls below a certain prescribed level, it’s not in good repair. If maintenance intervals grow beyond prescription, then the asset to be maintained is not in good repair. In practice, the lifespans are somewhat conservative so in practice a lot of things fall out of good repair and the system keeps running. The upshot is that because the maintenance standards are somewhat flexible, it’s easy to defer maintenance to make the system look financially healthier, or to deal with an unexpected budget shortfall.
Modern American SOGR goes back to the New York subway renewal programs of the 1980s and 90s, which worked well. The problem is that, just as the success of one infrastructure expansion tempts the construction of other, less socially profitable ones, the success of SOGR tempted agencies to justify large capital expenses on SOGR grounds. In effect, what should have been a one-time program to recover from the 1970s was generalized as a way of doing maintenance and renewal to react to the availability of money.
Megaprojects and non-megaprojects
In practice, what defines a megaproject is relative – a 6 km light rail extension is a megaproject in Boston but not in Paris – and this also means that they are not easy to locally benchmark, or else there would be many like them and they would be more routine. This means that megaprojects are, by definition, unusual. Their outcome is visible, and this attracts high-profile politicians and civil servants looking to make their mark. Conversely, their budgeting is less visible, because what must be included is not always clear. This leads to problems of bloat (this is the leakage problem), politicization, surplus extraction, and plain lying by proponents.
Non-megaprojects have, in effect, the opposite set of problems. Their individual components can be benchmarked easily, because they happen routinely. A short Paris Métro extension, a few new infill stations, and a weekend service change for track renewal in New York are all examples of non-megaprojects. These are done at the purely professional level, and if politicians or top managers intervene, it’s usually at the most general level, for example the institution of Fastrack as a general way of doing subway maintenance, and that too can be benchmarked internally. In this case, none of the usual problems of megaprojects is likely. Instead, problems occur because, while the budgeting can be visible to the agency, the project itself is not visible to the general public. If an entire new subway line’s construction fails and the line does not open, this is publicly visible, to the embarrassment of the politicians and agency heads who intended to take credit for it. In contrast, if a weekend service change has lower productivity than usual, the public won’t know until this problem has metastasized in general, by which point the agency has probably lost the ability to do this efficiently.
And to be clear, just as megaprojects like new subway lines vary widely in their ability to build efficiently, so do non-megaproject capital investments vary, if anything even more. The example I gave writing about Connecticut’s ill-conceived SOGR program, repeated in the high-speed rail report, is that per track- or route-km the state spends in one year about 60% as much as what Germany spends on a once per generation renewal program, to be undertaken about every 35 years. Annually, the difference is a factor of about 20. New York subway maintenance has degraded internally over time, due to ever tighter flagging rules, designed for worker protection, except that worker injuries rose from 1999 to the 2010s.
The Transit Costs Project
The goal of the Transit Costs Project is to use international benchmarking to allow cities to benefit from the best of both worlds. Megaprojects benefit from public visibility and from the inherent embarrassment to a politician or even a city or state that can’t build them: “New York can’t expand the subway” is a common mockery in American good-government spaces, and people in Germany mock both Bavaria for the high costs and long timeline of the second Munich S-Bahn tunnel and Berlin for, while its costs are rather normal, not building anything, not even the much-promised tram alternatives to the U-Bahn. Conversely, politicians do get political capital from the successful completion of a megaproject, encouraging their construction, even when not socially profitable.
Where we come in is using global benchmarking to remove the question marks from such projects. A subway extension may be a once in a generation effort in an American city, but globally it is not, and therefore, we look into how as much of the entire world as we can see into does this, to establish norms. This includes station designs to avoid overbuilding, project delivery and procurement strategies, system standards, and other aspects. Not even New York is as special as it thinks it is.
To some extent, this combination of the best features of both megaprojects and non-megaprojects exists in cities with low construction costs. This is not as tautological as it sounds. Rather, I claim that when construction costs are low, even visible extensions to the system fall below the threshold of a megaproject, and thus incremental metro extensions are built by professionals, with more public visibility providing a layer of transparency than for a renewal project. This way, growth can sustain itself until the city runs out of good places to build or until an economic crisis like the Great Recession in Spain makes nearly all capital work stop. In this environment, politicians grow to trust that if they want something big built, they can just give more money to more of the same, serving many neighborhoods at once.
In places with higher costs, or in places that are small enough that even with low costs it’s rare to build new metro lines, this is not available. This requires the global benchmarking that we use; occasionally, national benchmarking could work, in a country with medium costs and low willingness to build (for example, Germany), but this isn’t common.
The SOGR problem
If what we aim to do with the Transit Costs Project is to combine the positive features of megaprojects and non-megaprojects, SOGR does the exact opposite. It is conceived as a single large program, acting as the centerpiece of a capital plan that can go into the tens of billions of dollars, and is therefore a megaproject. But then there’s no visible, actionable, tangible promise there. There is no concrete promise of higher speed or capacity. To the extent some programs do have such a promise, they are subsumed into something much bigger, which means that failing to meet standards on (say) elevator reliability can be excused if other things are said to go into a state of good repair, whatever that means to the general public.
Thus, SOGR invites levels of bloat going well beyond those of normal expansion megaprojects. Any project can be added to the SOGR list, with little oversight – it isn’t and can’t be locally benchmarked so there is no mid-career professional who can push back, and conversely it isn’t so visible to the general public that a general manager or politician can push back demanding a fixed opening deadline. For the same reason, inefficiency can fester, because nobody at either the middle or upper level has the clear ability to demand better.
Worse, once the mentality of SOGR is accepted, more capital projects, on either the renewal side or the expansion side, are tied to it, reducing their efficiency. For example, the catenary on the Northeast Corridor south of New York requires an upgrade from fixed termination/variable tension to auto-tension/constant tension. But Amtrak has undermaintained the catenary expecting money for upgrades any decade now, and now Amtrak claims that the entire system must be replaced, not just the catenary but also the poles and substations. The language used, “the system is falling apart” and “the system is maintained with duct tape,” invites urgency, and not the question, “if you didn’t maintain this all this time, why should we trust you on anything?”. With the skepticism of the latter question, we can see that the substations are a separate issue from the catenary, and ask whether the poles can be rebuilt in place to reduce disruption, to which the vendors I’ve spoken with suggested the answer is yes using bracing.
The Connecticut track renewal program falls into the same trap. With no tangible promise of better service, the state’s rail lines are under constant closures for maintenance, which is done at exceptionally low productivity – manually usually, and when they finally obtained a track laying machine recently they’ve used it at one tenth its expected productivity. Once this is accepted as the normal way of doing things, when someone from the outside suggests they could do better, like Ned Lamont with his 30-30-30 proposal, the response is to make up excuses why it’s not possible. Why disturb the racket?
The way forward
The only way forward is to completely eliminate SOGR from one’s lexicon. Big capital programs must exclusively fund expansion, and project managers must learn to look with suspicion on any attempt to let maintenance projects piggyback on them.
Instead, maintenance and renewal should be budgeted separately from each other and separately from expansion. Maintenance should be budgeted on the same ongoing basis as operations. If it’s too expensive, this is evidence that it’s not efficient enough and should be mechanized better; on a modern railroad in a developed country, there is no need to have maintenance of way workers walk the tracks instead of riding a track inspection train or a track laying machine. With mechanized maintenance, inventory management is also simplified, in the sense that an entire section of track has consistent maintenance history, rather than each sleeper having been installed in a different year replacing a defective one.
Renewal can be funded on a one-time basis since the exact interval can be fudged somewhat and the works can be timed based on other work or even a recession requiring economic stimulus. But this must be held separate from expansion, again to avoid the Connecticut problem of putting the entire rail network under constant maintenance because slow zones are accepted as a fact of life.
The importance of splitting these off is that it makes it easier to say “no” to bad expansion projects masquerading as urgent maintenance. No, it’s not urgent to replace a bridge if the cost of doing so is $1 billion to cross a 100 meter wide river. No, the substations are a separate system from the overhead catenary and you shouldn’t bundle them into one project.
With SOGR stripped off, it’s possible to achieve the Transit Costs Project goal of combining the best rather than the worst features of megaprojects and non-megaprojects. High-speed rail is visible and has long been a common ask on the Northeast Corridor, and with the components split off, it’s possible to look into each and benchmark to what it should include and how it should be built. Just as New York is not special when it comes to subways, the United States is not special when it comes to intercity rail, it just lags in planning coordination and technology. With everything done transparently based on best practices, it is indeed possible to build this on an expansion budget of about $17 billion and a rounding-error track laying machine budget.
Tokyo Construction Costs
Here is a list of Japanese subways and their construction costs, courtesy of Borners, who has been working on this as well as on a deep dive about London construction costs. I’d been looking for this data for years; someone in comments posted a link to a different sheet summarizing the same data years ago but I couldn’t find it.
Unfortunately, the list isn’t quite good enough to be used for all subway lines. The problem is that the numbers are given in nominal yen for the costs of constructing entire lines, including ones that opened in phases over many years during which inflation was significant. The table of lines and their construction costs in units of 100 million yen/km is as follows, with my best attempt at deflating to 2023 prices, still in units of 100 million yen/km; to convert to millions of dollars per km, the 2022 PPP rate is $1 = ¥94.93, so add 5.3% to all numbers in the penultimate column.
| Line | Cost/km | First works | First opening | Final opening | Year of prices | Cost/km (real) | Confidence |
| Marunouchi | 18 | 1951 | 1954 | 1962 | 1956 | 114 | Medium |
| Asakusa | 46 | 1956 | 1960 | 1968 | 1961 | 257 | Medium |
| Hibiya | 32 | 1959 | 1961 | 1964 | 1961 | 179 | High |
| Tozai | 41 | 1962 | 1964 | 1969 | 1965 | 181 | High |
| Mita | 91 | 1965 | 1968 | 2000 | 1975 | 182 | Low |
| Chiyoda | 69 | 1966 | 1969 | 1979 | 1970 | 236 | Low |
| Yurakucho | 167 | 1970 | 1974 | 1988 | 1979 | 261 | Low |
| Hanzomon | 255 | 1972 | 1978 | 2003 | 1983 | 336 | Low |
| Shinjuku | 235 | 1971 | 1978 | 1989 | 1976 | 433 | Low |
| Namboku | 262 | 1986 | 1991 | 2001 | 1993 | 291 | High |
| Oedo | 311 | 1986 | 1991 | 2000 | 1994 | 343 | High |
| Fukutoshin | 282 | 2001 | 2008 | 2008 | 2005 | 314 | High |
The confidence level is a combination of the length of time it took to build the line and the inflation rate over that period. The Oedo and Namboku Lines opened in stages over a decade, but during that decade Japan had no inflation, and as a result price level adjustments are easy. In contrast, inflation in the 1960s was high but the Hibiya and Tozai Lines were built quickly, so that the uncertainty based on picking a year to deflate to is maybe 10%. The in between lines – Mita, Chiyoda, Yurakucho, Hanzomon – all opened in stages over a long period of time with significant inflation. This makes it hard to use them to answer the question, what was Tokyo’s cost history?
What the numbers suggest is that by the 1970s, construction costs were not much lower than they’d be in the 2000s; Japan having grown steadily in the 1970s and 80s, this means that its ability to afford new subways after the bubble burst in the 1990s was actually greater than in the 1970s. Construction costs have risen since – an extension of the Namboku Line to Shinagawa is budgeted at ¥131 billion/2.5 km and a branch extension of the Yurakucho Line from Toyosu to Sumiyoshi is budgeted at ¥269 billion/4.8 km. Toyosu-Sumiyoshi is in Shitamachi and has multiple canal crossings justifying an elevated cost, but Shirokane-Takanawa-Shinagawa is in easier topography, and while it has multiple subway crossings over a short length, so did the lines built in the 1990s and 2000s – the Fukutoshin Line has, over 9 km, five subway crossings and complex connections at both ends with through-running.
Cos Cob Bridge Replacement
The Northeast Corridor has eight movable bridges in Connecticut; other than one that was replaced in the 1990s, all are considered by Amtrak and Connecticut DOT to be both critical priorities for replacement and also major undertakings. The Bipartisan Infrastructure Law funded two, on the Connecticut and the Norwalk Rivers. The costs are enormous, beyond any justification: the Walk Bridge replacement is funded at $1 billion for a four-track bridge of 200 meters, and the replacement will still be a movable bridge rather than a fixed span with enough clearance below for boat traffic. The cost can be compared with an order of magnitude of tens of millions of dollars for comparable or longer bridges, for examples $50 million for one of the Rhone bridges on the LGV Méditerranée and $32 million for an 800 m viaduct on the Erfurt-Nuremberg line.
The goal of this post is to focus on the Cos Cob Bridge on the Mianus River. Among the eight bridges, it is the one with the least advanced plans for rehabilitation, such that no cost figure is given, but rumors put it in the mid-single digit billions for a viaduct of about 1 km, crossing about 250 m of water. Among the bridges west of New Haven, it is also the one with the most constrained alignment making replacement more necessary to fix the right-of-way geometry: the bridge itself is straight but flanked by two short, sharp curves, and replacement should be bundled with a wider curve.
The NEC Webtool outlines one alignment, with a wide curve, 2,400 meters in radius. The snag is the vertical alignment. The bridge needs to be high enough to clear boat traffic below; I-95 slightly upriver has a clearance below of 14.9 meters (Wikipedia says 21 meters but that’s the top of the deck, not the bottom), and with a typical deck thickness of 1.5 meters it means top of rail needs to be about 16.5 meters above sea level – but the Riverside station 450 meters east of the midpoint of the river has top of rail 10 meters above sea level and the Cos Cob station under the I-95 overpass 450 meters west of the midpoint is 8 meters above sea level. To build it as a high span thus requires rising 8.5 meters over 450 meters.
The current Northeast Corridor plans hew to a much lower ruling grade. The Walk Bridge is being replaced with another movable bridge and not a high fixed span because the standards call for a 1% grade. This is, frankly, dumb. The passenger trains are electric, either commuter rail EMUs or powerful intercity trains capable of climbing 4% grades over a short section, even the medium-speed Northeast Regionals. The freight trains are long enough that what matters isn’t so much the maximum grade as the maximum grade averaged over the length of a train, in which case peaking at 4% over a length of 450 meters is not at all problematic.
With a 4% standard, the question is not about the grade, but about the vertical curve radius. Standards for those are tighter than for horizontal curves. Vertical and horizontal curve radii both follow the formula ar = v^2, but the acceleration limit a is much tighter since there is no tilting or superelevation, and on a crest a high speed also reduces the effective weight acceleration and thus reduces train stability. In Germany, a is limited to 0.482 on a crest and 0.594 on a hallow, both requiring special permission; in Sweden, the German crest value is the minimum limit, with no special dispensation on a hallow. The upshot is that at 250 km/h, the exceptional vertical curve radius is 10,000 m and thus it takes 400 meters just to get to 4%; over a length of 450 meters, the maximum average gradient is 1.125% if the higher acceleration rate on a hallow isn’t used or 1.25% if is and the tracks can only rise respectively 5 or 5.5 meters. To make it 8.5, the speed limit needs to be reduced: at 200 km/h, the vertical curve radius is 6,400 meters and then over 225 meters the trains can get up to 3.5% and, if it’s symmetric, over 450 they can climb 7.9 meters, and if it’s asymmetric then they can climb more than the required 8.5%. It’s dirty but it does work.
The issue is then how this affects construction. I don’t know why the Connecticut bridge replacements are so expensive, beyond the observation that everything in Connecticut is exceptionally expensive, usually even by the standards of other Northeastern American rail projects (for example, infill stations), let alone European ones. The local press articles talk about staging construction to avoid disturbing the running track, and if this is the main difficulty, then building a new bridge 50 meters upriver should be much easier, since then the only part of the project interfacing with the existing track is the track connections on firma.
Whatever it is, a multi-billion dollar pricetag is not believable given the required scope. More difficult construction has been done for two orders of magnitude less on this side of the Pond. On a different mode but in the same region, the 10-lane 1.4 km long Q Bridge cost $554 million, around $790 million today, which, relative to the size of the bridge, is still around an order of magnitude cheaper than Walk and more than an order of magnitude cheaper than what Cos Cob is rumored to be.
Meme Weeding: Costs and Office Productivity
One of the arguments I’ve seen from time to time excusing high construction costs in English-speaking countries is that their salaries are so high, it drags all other costs up. It’s a rather bad excuse, since there is very little correlation between construction costs and GDP per capita globally: he United States and Singapore are both very rich and very expensive to build metros in, but then Switzerland and the Scandinavian countries are also very rich and fairly cheap to build metros in, and the UK is expensive without being especially rich by European standards. But then I’ve more recently seen people in the US and UK try to specialize their argument to professional services productivity, to take into account that this is a sector where London is very strong and the cities of Germany are not. However, even this doesn’t explain construction cost patterns well. The pattern in which the Anglosphere is uniformly bad has to be understood not as a matter of high wages or productivity, but as a matter of the UK and US developing bad practices for somewhat different reasons and the other English-speaking countries imitating them out of cultural cringe.
The issue here is that while London is a global financial center with high office work productivity and a wealth of professional services, this isn’t true of the rest of the Anglosphere with the exception of the United States. Dublin is not a global financial center; Ireland has high GDP per capita but most of it is profits of corporations owned by foreigners, and local incomes average the same as in Italy. Dublin has a large tech industry for its size – American tech companies have hubs there to justify setting their global headquarters in Ireland to take advantage of a mutual loophole in American and Irish tax laws – but programmers are not usually a substitute for the sort of procurement experts, planners, and overseeing civil servants who are relevant for project delivery, and barely are a substitute for the mechanical and civil engineers who design station standards. Toronto is Canada’s financial center, but Canadian banks are not especially important outside Canada, so in that sense it is substantially less important for professional services than Paris.
What connects all of those Anglosphere cities – and also ones not mentioned above, like Sydney, Melbourne, and Auckland, not to mention Singapore and Hong Kong – is that they all have branch offices of British and American consultancy firms, so they’re more visible in their roles as centers of professional services. But that is not about professional services, but about their ties to British and American global corporate cultures. This is relevant to their high costs, not because the presence of a strong professional services industry raises costs, but because those countries all pick up American and British ideas about the superiority of the international consultancy to the state and then implement a project delivery system that seeks to empower such consultancies. As a usually intended consequence, this system also empowers personalist politicians, who get to micromanage those billion-dollar contracts, and would lack the institutional capacity to manage more normal-size contracts, which they would have to outsource to the permanent civil service rather than to their own political staffers.
In fact, the stereotype that high-cost, low-income-by-first-world-standards countries like Ireland, New Zealand, and Canada are hubs of professional services is itself part of the broader problem. Paris is a giant hub of corporate headquarters and professional services. They are not specialized to finance the way London’s companies are, but the banking profession isn’t more in competition for good managers with the public procurement profession than any other professional service. France is not a particularly industrialized country, unlike Germany or Italy; the good jobs there all involve managing other office workers, as in the US and UK. It’s just a different ecosystem of professional services firms from the British and American one, so it’s worse-known to Americans and Brits.
Similarly, Dublin may be a large tech hub due to its tax haven status, but Zurich has Google’s largest foreign office, at least as of the late 2010s. Zurich is also a rather large banking center for its size. Swiss wages and prices are legendarily high, and Switzerland is almost as deindustrialized as the US or France, but this has not driven Swiss infrastructure construction costs up. To the contrary, Switzerland feels at the top of the world, with little need to privatize its rail services or delivery; not being an EU country, it does not fall under the EU open access mandate, and has not imitated it in its intercity rail planning, because from its perspective, it has the best rail network in Europe by traffic and modal split, so it has little reason to imitate British managerial practices (or, for that matter, French speed; Swiss average rail speeds are low).
So the stereotype that high Anglosphere costs come from high professional services productivity, like the myth that Anglosphere countries other than the US and Singapore are exceptionally rich, is false. It persists because it helps people in the US and UK cope: their high costs, in this schema, are not an inferiority that they should fix, but rather a regrettable but livable side effect of superiority. It’s not the only place where this coping exists; I’ve seen Americans excuse their combination of the highest health care costs in the world and the lowest life expectancy in the developed world sensu stricto by appealing to their high wages, an appeal that’s entirely invisible if one looks at the developed world omitting the US (Nordic life expectancy is high with health costs at the EU average).
In truth, high costs in the English-speaking world are not an aspect of superiority – quite to the contrary. They coexist with some other more positive aspects, in the same way that each country or cluster of countries has its own set of social problems, averaging with positive aspects to a reasonable first-world living standard. But they don’t follow from wealth, democracy, or anything else that Americans and Brits are proud of, whether or not it’s even true. They’re a genuine problem, for which the solution must be to, to an extent, de-Anglicize and de-Americanize and instead pick up the better practices of the rest of the developed world.
Quick Note: Commuter Rail Rolling Stock Costs
ETA just published a report on New York rolling stock costs for commuter rail. In the report, we talk about the need to electrify the entire system, and, if there are unelectrified tails (which there shouldn’t be), the solution for them is not more diesel locomotives. For the purposes of this post, I’d instead like to talk about the difficulties of getting some of this information; the rolling stock database that we have at the Transit Costs Project is growing, but is far from complete, and has gaps, with some information including cost missing for critical orders. What I think from the available data is that alternatives to electrification are far more expensive – the one with the most reliable cost data, battery-electric trains (BEMUs), costs close to 2.5 times as much, while dual-mode diesel-electric multiple units (DEMUs) cost less than BEMUs and more than regular electric multiple units (EMUs). But this is based on imperfect data and I’d like to discuss this issue more.
To the point on EMU costs: something is seriously screwed up with some of the orders. There’s that diva effect for large cities that I’ve talked about for years, in which large cities with old systems prefer to buy custom designs, for example the X’Trapolis in Paris, or the Berlin U- and S-Bahn orders. These are the largest orders, so the average cost Europe-wide is pulled up by these cases. In contrast, standard regional EMU orders are more routine and cheaper; two recent FLIRT orders, for Hanover and Bremen, were respectively $110,000/meter of length and $104,000/meter. But even then, there are variations, and Coradia Stream orders vary by a factor of about 2, for reasons that I don’t quite get.
Then BEMUs are not ordered in a large quantity, but when they are, the costs appear high – the database has a $249,000/m order by ÖBB; there’s an even more expensive order for NAH.SH, both FLIRT Akkus. Another fairly large order, for Pfalznetz, does not have cost data anywhere that I can see; Stadler is putting up a technical sheet for it, but not for ÖBB, but then whenever I look up costs for the Pfalznetz Akku I only get the NAH.SH one and I don’t know why.
There’s a Metra Akku order, whose costs are murky, depending on how one counts them. The procurement order lists the cost as $12.635 million for a two-car BEMU set, which is about $250,000/m, but then the option order includes trailer cars at about $2.5 million apiece. A four-car train so formed would only be around $176,000/m, but would also be severely underpowered. The Stadler technical sheet for the Metra Akku lists its power rating as 1 MWh, which is the wrong unit, but could plausibly be a typo for 1 MW; no weight is listed, but the two-car NAH.SH Akku is 96 t – but then the Metra Akku uses a power pack, which may yield somewhat different results, so the exact numbers are unclear, even if the general result that the Metra Akkus are likely to have a power-to-weight ratio in the vicinity of 6 is close enough, and damning enough. In general, American orders sometimes do that, using multiple-unit trains as locomotives with seats and diluting them with unpowered cars, just because their acquisition costs are so high that they can’t run trains with good performance specs (and, given how conservative the schedules are, they don’t think it’s important anyway).
Low Spanish Costs are not About Decentralization
An article by Ben Hopkinson at Works in Progress is talking about what Madrid has been doing right to build subways at such low costs, and is being widely cited. It sounds correct, attributing the success to four different factors, all contrasted with the high-cost UK. The first of these factors, decentralization in Spain compared with its opposite in England, is unfortunately completely wrong (the other three – fast construction, standardized designs, iterative in-house designs – are largely right, with quibbles). Even more unfortunately, it is this mistake that is being cited the most widely in the discussion that I’m following on social media. The mentality, emanating from the UK but also mirrored elsewhere in Europe and in much of the American discourse, is that decentralization is obviously good, so it must be paired with other good things like low Spanish costs. In truth, the UK shares high costs with more decentralized countries, and Spain shares low ones with more centralized ones. The emphasis on decentralization is a distraction, and people should not share such articles without extensive caveats.
The UK and centralization
The UK is simultaneously expensive to build infrastructure in and atypically centralized. There is extensive devolution in Scotland, Wales, and Northern Ireland, but it’s asymmetric, as 84% of the population lives in England. Attempts to create symmetric devolution to the Regions of England in the Blair era failed, as there is little identity attached to them, unlike Scotland, Wales, or Northern Ireland. Regional identities do exist in England, but are not neatly slotted at that level of the official regions – Cornwall has a rather strong one but is only a county, the North has a strong one but comprises three official regions, and the Home Counties stretch over parts of multiple regions. Much of this is historic – England was atypically centralized even in the High Middle Ages, with its noble magnates holding discontinuous lands; identities that could form the basis of later decentralization as in France and Spain were weaker.
People in the UK understand that their government isn’t working very well, and focus on this centralization as a culprit; they’re aware of the general discourse from the 1960s onward, associating decentralization with transparency and accountability. After the failure of Blair-era devolution, the Cameron cabinet floated the idea of doing devolution but at lower level, to the metropolitan counties, comprising the main provincial cities, like Greater Manchester or the West Midlands (the county surrounding Birmingham, not the larger official region). Such devolution would probably be good, but is not really the relevant reform, not when London, with its extreme construction costs, already has extensive devolved powers.
But in truth, the extreme construction costs of the UK are mirrored in the other English-speaking countries. In such countries, other than the US, even the cost history of similar, rising sharply in the 1990s and 2000s with the adoption of the more privatized, contractor-centric globalized system of procurement. The English story of devolution is of little importance there – Singapore and Hong Kong are city-states, New Zealand is small enough there is little reason to decentralize there, and Canada and Australia are both highly decentralized to the provinces and states respectively. The OECD fiscal decentralization database has the UK as one of the more centralized governments, with, as of 2022, subnational spending accounting for 9.21% of GDP and 19.7% of overall spending, compared with Spain’s 20.7% and 43.6% respectively – but in Australia the numbers are 17.22% and 46.2%, and in Canada they are 27.8% and 66.5%.
American construction costs have a different history from British ones. For one, London built for the same costs as German and Italian cities in the 1960s and 70s, whereas New York was already spending about four times as much per km at the time. But this, too, is an environment of decentralization of spending; the OECD database doesn’t mention local spending, but if what it includes in state spending is also local spending, then that is 19.07% of American GDP and 48.7% of American government spending.
In contrast, low-cost environments vary in centralization considerably. Spain is one of the most decentralized states in Europe, having implemented a more or less symmetric system in response to Catalan demands for autonomy, but Italy is fairly centralized (13.9% of GDP and 24.8% of government spending are subnational), and Greece and Portugal are very centralized and Chile even more so (2.77%/8.1%). The OECD doesn’t include numbers for Turkey and South Korea so we can merely speculate, but South Korea is centralized, and in Istanbul there are separate municipal and state projects, both cheap.
Centralization and decisionmaking
Centralization of spending is not the same thing as centralization of decisionmaking. This is important context for Nordic decentralization, which features high decentralization of the management of welfare spending and related programs, but more centralized decisionmaking on capital city megaprojects. In Stockholm, both Citybanan and Nya Tunnelbanan were decided by the state. Congestion pricing, in London and New York a purely subnational project, involved state decisions in Stockholm and a Riksdag vote; the Alliance victory in 2006 meant that the revenue would be spent on road construction rather than on public transport.
In a sense, the norm in unitary European states like the Nordic ones, or for that matter France, is that the dominant capital has less autonomy than the provinces, because the state can manage its affairs directly; thus, RATP is a state agency, and until 2021 all police in Paris was part of the state (and the municipal police today has fewer than 10% of the total strength of the force). In fact, on matters of big infrastructure projects, the state has to do so, since the budgets are so large they fall within state purview. Hopkinson’s article complaining that Crossrail and Underground extensions are state projects needs to be understood in that context: Grand Paris Express is a state project, debated nationally with the two main pre-Macron political parties both supporting it but having different ideas of what to do with it, not too different from Crossrail; the smaller capitals of the Nordic states have smaller absolute budgets, but those budgets are comparable relative to population or GDP, and there, again, state decisionmaking is as unavoidable as in London and Paris.
The purest example of local decisionmaking in spending is not Spain but the United States. Subway projects in American cities are driven by cities or occasionally state politicians (the latter especially in New York); the federal government isn’t involved, and FTA and FRA grants are competitive and decided by people who do not build but merely regulate and nudge. This does not create flexibility – to the contrary, the separation between builders and regulators means that the regulators are not informed about the biggest issues facing the builders and come up with ideas that make sense in their heads but not on the ground, while the builders are too timid to try to innovate because of the risk that the regulators won’t approve. With this system, the United States has not seen public-sector innovation in a long while, even before it became ideologically popular to run against the government.
In finding high American costs in the disconnect between those who do and those who oversee, at multiple levels – the agencies are run by an overclass of political appointees and directly-reporting staff rather than by engineers, states have a measure of disconnect from agencies, and the FTA and FRA practice government-by-nudge – we cannot endorse any explanation of high British costs that comes from centralization.
If the policy implications of such an explanation are to devolve further powers to London or a Southeast England agency, then they are likely to backfire, by removing the vestiges of expertise of doers from the British state; the budgets involves in London expansion are too high to be handled at subnational level. Moreover, reduction in costs – the article’s promise of a Crossrail 2, 3, and 4 if costs fall – has no chance of reducing the overall budget; the same budget would just be spent on further tunnels, in the same manner the lower French costs lead to a larger Grand Paris Express program. Germany and Italy in the same schema have less state-centric decisionmaking in their subway expansion, for the simple reason that both countries underbuild, which can be seen in the very low costs per rider – a Berlin with the willingness to build infrastructure of London or Paris would have extended U8 to Märkisches Viertel in the 1990s at the latest.
One possible way this can be done better is if it’s understood in England that decentralization only really works in the sense of metropolitanization in secondary cities, where the projects in question are generally below the pay grade of state ministers or high-level civil servants. In the case of England, this would mean devolution to the metropolitan counties, giving them the powers that Margaret Thatcher instead devolved to the municipalities. But that, by itself, is not going to reduce costs; those devolved governments would still need outside expertise, for which public-sector consultants, in the British case TfL, are necessary, using the unitariness of the state to ensure that the incentives of such public-sector consultants are to do good work and push back against bad ideas rather than to just profit off of the management fees.
The first-line effect
The article tries to argue for decentralization so much it ends up defending an American failure, using the following language:
But the American projects that are self-initiated, self-directed, self-funded, self-approved, and in politically competitive jurisdictions do better. For example, Portland, Oregon’s streetcar was very successful at regenerating the Pearl District’s abandoned warehouses while being cutting-edge in reducing costs. Its first section was built for only £39 million per mile (inflation adjusted), half as much as the global average for tram projects.
To be clear, everything in the above paragraph is wrong. The Portland Streetcar was built for $57 million/4 km in 1995-2001, which is $105.5 million/4 km in 2023 dollars, actually somewhat less than the article says. But $26.5 million/km was, in the 1990s, an unimpressive cost – certainly not half as much as the global average for tram projects. The average for tram projects in France and Germany is around 20 million euros/km right now; in 2000, it was lower. So Portland managed to build one very small line for fairly reasonable costs, but they were not cutting edge; this is a common pattern to Western US cities, in that the first line has reasonable costs and then things explode, even while staying self-funded and self-directed. Often this is a result of overall project size – a small pilot project can be overseen in-house, and then when it is perceived to succeed, the followup is too large for the agency’s scale and then things fall apart. Seattle was building the underground U-Link for $457 million/km in 2023 dollars; the West Seattle extension, with almost no tunneling, is budgeted at $6.7-7.1 billion/6.6 km, which would be a top 10 cost for an undeground line, let alone a mostly elevated one. What has changed in 15 years since the beginning of U-Link isn’t federal involvement, but rather the scope of the program, funded by regional referendum.
The truth is that there’s nothing that can be learned from American projects within living memory except what not to do. There’s always an impulse to look for the ones that aren’t so bad and then imitate them, but they are rare and come from a specific set of circumstances – again, first light rail lines used to be like this and then were invariably followed by cost increases. But the same first-line effect also exists in the reasonable-cost world: the three lowest-cost high-speed rail lines in our database built to full standards (double track, 300+ km/h) are all first lines, namely the Ankara-Konya HST ($8.1 million/km in 2023 PPPs), the LGV Sud-Est ($8.9 million/km), and the Madrid-Seville LAV ($15.4 million/km); Turkey, Spain, and France have subsequently built more high-speed lines at reasonable costs, but not replicated the low costs of their first respective lines.
On learning from everyone
I’ve grown weary of the single case study, in this case Madrid. A single case study can lead to overlearning from the peculiarities of one place, where the right thing to do is look at a number of successes and look at what is common to all of them. Spain is atypically decentralized for a European state and so the article overlearns from it, never mind that similarly cheap countries are much more centralized.
The same overall mistake also permeates the rest of the article. The other three lessons – time is money, trade-offs matter and need to be explicitly considered, and a pipeline of projects enables investment in state capacity, are not bad; much of what is said in them, for example the lack of NIMBY veto power, is also seen in other low-cost environments, and is variable in medium-cost ones like France and Germany. However, the details leave much to be desired.
In particular, one the tradeoffs mentioned is that of standardization of systems, which is then conflated with modernization of systems. The lack of CBTC in Madrid is cited as one way it kept construction costs down, unlike extravagant London; the standardized station designs are said to contrast with more opulent American and British ones. In fact, neither of these stories is correct. Manuel Melis Maynar spoke of Madrid’s lack of automation as one way to keep systems standard, but that was in 2003, and more recently, Madrid has begun automating Line 6, its busiest; for that matter, Northern Europe’s lowest-construction cost city, Nuremberg, has automated trains as well. And standardized stations are not at all spartan; the lack of standardization driving up costs is not about nice architecture, which can be retrofitted rather cheaply like the sculptures and murals that the article mentions positively, but behind-the-scenes designs for individual system components, placement of escalators and elevators, and so on.
The frustrating thing about the article, then, is that it is doing two things, each of which is suspect, the combination of which is just plain bad. The first is that it tries to overlearn from a single famous case. The second is that it isn’t deeply aware of this case; reading the article, I was stricken by how nearly everything it said about Madrid I already knew, whereas quite a lot of what it said about the UK I did not, as if the author was cribbing off the same few reports that everyone in this community has already read and then added original research not about the case study but about Britain.
And then the discourse, unfortunately, is not about the things in the article that are right – the introduction in lessons 2-4 into how the civil service in Madrid drives projects forward – but about the addition of the point about centralization, which is not right. Going forward, reformers in the UK need far better knowledge of how the low- and medium-construction cost world looks, both deeper and broader than is on display here.
Commuter Rail to Staten Island
A debate in my Discord channel about trains between Manhattan and Staten Island clarified to me why it’s so important that, in the event there is ever rail service there, it should use large commuter trains rather than smaller subway stations. The tradeoff is always that the longer trains used on commuter services lead to higher station construction costs than the smaller trains used on captive subway lines. However, the more difficult the tunnel construction is, and the fewer stations there are, the smaller the cost of bigger trains is. This argues in favor of commuter trains across the New York Harbor, and generally on other difficult water or mountain crossings.
When costing how much expansive commuter rail crayon is, like my Assume Normal Costs map, I have not had a hard time figuring out the station costs. The reason is that the station costs on commuter rail, done right, are fairly close to subway station costs, done wrong. As we find in the New York construction cost report, Second Avenue Subway’s 72nd and 86th Street stations were built about twice as large as necessary, and with deep-mined caverns. If you’re building a subway with 180 m long trains under Second Avenue, then mining 300-400 m long stations is an extravagance. If you’re building a regional rail tunnel under city center, and the surface stations are largely capable of 300 m long trains or can be so upgraded, then it’s normal. Thus, a cost figure of about $700 million per station is not a bad first-order estimate in city center, or even $1 billion in the CBD; outside the center, even large tunneled stations should cost less.
The cost above can be produced, for example, by setting the Union Square and Fulton Street stations at a bit less than $1 billion each (let’s say, $1.5 billion each, with each colored line contributing half), and a deep station under St. George at $500 million, totaling $2 billion. The 15 km of tunnel are then doable for $3 billion at costs not far below current New York tunneling costs. Don’t get me wrong, it still requires cost control policies on procurement and systems, but relative to what this includes, it’s not outlandish.
This, in turn, also helps explain the concept of regional rail tunnels. These are, in our database, consistently more expensive than metros in the same city; compare for example RER with Métro construction costs, or London Underground extensions with Crossrail, or especially the Munich U- and S-Bahn. The reason is that the concept of regional rail tunneling is to only build the hard parts, under city center, and then use existing surface lines farther out. For the same reason, the stations can be made big – there are fewer of them, for example six on the original Munich S-Bahn and three on the second trunk line under construction whereas the Munich U-Bahn lines have between 13 and 27, which means that the cost of bigger stations is reduced compared with the benefit of higher capacity.
This mode is then appropriate whenever there is good reason to build a critical line with relatively few stations. This can be because it’s a short connection between terminals, the usual case of most RER and S-Bahn lines; in the United States, the Center City Commuter Connection is such an example, and so is the North-South Rail Link if it is built. This can also be because it’s an express line parallel to slower lines, like the RER A. But it can also be because it doesn’t need as many stations because it crosses water, like any route serving Staten Island.
The flip side is that whenever many stations are required on an urban rail tunnel, it becomes more important to keep costs down by, potentially, shrinking the station footprint through using shorter trains. In small enough cities, as is the case in some of the Italian examples discussed in that case, like Brescia and Turin, it’s even possible to build very short station platforms and compensate by running driverless trains very frequently, producing an intermediate-capacity system. In larger cities, this trick is less viable, but sometimes there are corridors where there is no alternative to a frequent-stop urban tunnel, such as Utica in New York, and then, regional rail loses value. But in the case of Staten Island, to the contrary, commuter rail is the most valuable option.
Quick Note: Kathy Hochul and Eric Adams Want New York to Be Worse at Building Infrastructure
Progressive design-build just passed. This project delivery system brings New York in full into the globalized system of procurement, which has led to extreme cost increases in the United Kingdom, Canada, and other English-speaking countries, making them unable to build any urban transit megaprojects. Previously, New York had most of the misfeatures of this system, largely through convergent evolution, but due to slowness in adapting outside ideas, the state took until now, with extensive push from Adams’ orbit, for which Adams is now taking credit, to align. Any progress in cost control through controlling project scope will now be wasted on the procurement problems caused by this delivery method.
What is progressive design-build?
Progressive design-build is a variant on design-build. There is some divergence between New York terminology and rest-of-world terminology; for people who know the latter, progressive design-build is approximately what the rest of the world calls design-build.
To give more detail, designing and constructing a piece of infrastructure, say a single subway station, are two different tasks. In the traditional system of procurement, the public client contracts the design with one firm, and then bids it out to a different firm for construction; this is called design-bid-build. All low-construction cost subway systems that we are aware of use a variant of design-bid-build, but two key features are required to make it work: sufficient in-house supervision capacity since the agency needs to oversee both the design and the build contracts, and flexibility to permit the build contractors to make small changes to the design based on spot prices of materials and labor or meter-scale geological discoveries. The exact details of both in-house capacity and flexibility differ by country; for example, Turkey codifies the latter by having the design contract only cover 60% design, and bundling going from 60% to 100% design with the build contract. Despite the success of the system in low-construction cost environments, it is unpopular among the global, especially English-speaking, firms, because it is essentially client-centric, relying on high competence levels in the public sector to work.
To deal with the facts that large global firms think they are better than the public sector, and that the English-speaking world prefers its public sector to be drowned in a bathtub, there are alternative, contractor-centric systems of project delivery. The standard one in the globalized system is called design-build or design-and-build, and simply means that the same contractor does both. This means less public-facing friction between designers and builders, and more friction that’s hidden from public view. Less in-house capacity is required, and the contracts grow larger, an independent feature of the globalized system. As the Swedish case explains in the section on the traditional and globalized systems, globalized Swedish contracts go up to $300-500 million per contract (and Swedish costs, once extremely low, are these days only medium-low); in New York, contracts for Second Avenue Subway Phase 2 are already in the $1-2 billion range.
In New York, the system is somewhat complicated by the text of legacy rules on competitive bidding, which outright forbid a company from portraying itself as doing both design and construction. It took recent changes to legalize the Turkish system of bundling the two contracts differently; this changed system is what is called design-build in New York and is used for Second Avenue Subway Phase 2, even though there are still separate design and construction contracts, and is even called design-build in Turkey.
Unfortunately, New York did not stop at this, let’s call it, des-bid-ign-build system. Adams and Hochul want to be sure to wreck state capacity. Thus, they’ve pushed for progressive design-build, which is close to what the rest of the world calls design-build. More precisely, the design contractor makes a build bid at the end of the design phase, and is presumed to become the build contractor, but if the price is too high, there’s an escape clause and then it becomes essentially design-bid-build.
The globalized system that led to a cost explosion in the UK and Canada in the 1990s and 2000s from reasonable to strong candidates for second worst in the world (after the US) is now coming to New York, which already has a head start in high construction costs due to other problems. It’s a win-win for political appointees and cronies, and they clearly matter more than the people of the city and state of New York.
Pedestrian Observations 