High Cost Rail - Part 143 $27M per Day

Not much else to add besides what the LA Times is reporting on burgeoning expenses that aren't even burgeoning enough

LOS ANGELES —The California bullet train project has cost state taxpayers an average $3.1 million a day over the last year —a construction spending rate higher than that for the Bay Bridge, Boston's Big Dig or any U.S. transportation project in recent history.

But still it's not enough, planners say.  In order to hit its 2033 deadline and $77 billion budget, the California High Speed Rail Authority will have to increase daily spending by up to nine times over the next four years or risk putting the already-delayed system further behind.  Russell Fong, the authority's chief financial officer, acknowledges the goals will be difficult to achieve.

Still, officials said they are beginning to ramp up spending, and the estimates were officially adopted by the rail authority board in its 2018 business plan.  But outside infrastructure experts question whether the $27 million-a-day outlay necessary under the plan would even be possible.

"That burn rate is ludicrous," said civil engineer James Moore, director of the University of Southern California's transportation engineering program. "It is so far outside standard experience that it doesn't make sense to assume it will occur."

"Outside standard experience".  I like that and will use it going forward.

Comments

[Bruce Dickinson]

Joe, kind of a poorly written article, at least the first half of it. The problem isn't framed properly: it's build rate, not spend rate. Bruce Dickinson will point out the obvious that spending won't increase unless you have something to spend it on. In a meandering, indirect way, the article then states that the labor, resources, materials and inflation assumptions are wrong. There is a shortage of labor/materials that are increasing in price, so yeah the cost of the project goes up, but how can you spend if you can't line up everything to spend on right away when the labor resources are limited and you can only build so much at once.

The real killer is gonna be the inflation assumptions. You have below actual inflation numbers being projected into the future! And guess what? the actual cost inflation seen, which is higher than the HSR projections, occurred during a 30-year low interest rate environment! In George W Bush's words, that is likely to be a mis-underestimated number.

Folks you heard it here first, Bruce Dickinson projects a 4x-5x total project cost for HSR for a total of $280-$350 billion dollars over the life of the project (today's dollars).

Now, who wants to bet who is closer to the actual number: the HSR authority, with hundreds of employees and consultants or Bruce Dickinson??

Any takers??

[Cassandra]

Vote for Cox. Just for the sake of stopping HSR. $ 3.1 million a day for some hot button issues.

[Joe]

Agreed, Bruce. Spend rate is easier to headline than x number of concrete truck deliveries, y feet of rebar, etc. so we get:

The bullet train project, with its record-breaking rate of spending last year, fell 31 percent short of the authority's $4.5 million-a-day target. In its current fiscal year, the aim is to spend $1.8 billion, or $4.9 million a day. At its peak in fiscal 2023, spending should hit $10.7 billion —or $29 million every calendar day —according to planning documents.
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The more interesting bet is whether any trains ever run :-)