Last year, Eno kicked off a major research initiative analyzing cost and timeline drivers affecting the delivery of rail transit in the United States.
As part of this research, the Eno team has conducted a comprehensive literature review, begun interviewing stakeholders about project delivery in eight case study regions (four domestic, four international), and assembled an initial database of domestic and international light and heavy rail construction costs.
The Eno team has collected construction cost data for a total of 175 domestic and international rail transit projects – 90 light rail/tram projects, 63 heavy rail projects, and 22 commuter rail projects completed over the past 20 years (projects slated to completed after 2021 were not included).
This database expands on earlier construction cost data collection by Alon Levy and Eric Goldwyn at the NYU Marron Institute and Yonah Freemark via The Transport Politic with a focus on capturing light rail construction costs in the United States and Western Europe given the dominant role of light rail in new transit construction in the United States. Along with validating references for lines included in other databases referenced above, we relied on a range of academic, media, industry, and government resources to obtain reported construction costs for all new lines entered into the database. We sought to rely on official government or professional cost reports wherever possible. In cases where media reports were used, we aimed to confirm whether the same – or very similar – cost figure was used across other outlets. Additional project detail collected includes groundbreaking and opening years, project length (kilometers), number of stations, grade alignment (the share of total alignment that is below ground, at-grade, and above-ground), and station spacing (calculated as stations-per-kilometer). To ensure that all project costs are compared in 2020 U.S. Dollars, reported costs were adjusted using Purchasing Power Parity (PPP) rates for projects reported in non-U.S. currency and inflation for all projects. Currency conversions were based on the OECD’s PPP table, which documents conversion rates for international currencies to US Dollars in a given year, taking differing price levels between countries into account (measured as foreign currency needed to purchase $1 worth of goods). After converting to U.S. dollars, all project costs were then adjusted to 2020 dollars using a standard inflation calculator. A project’s construction midpoint (halfway between groundbreaking and opening) was used as the base year when adjusting for inflation, with the exception of cases where the exact year of a project’s reported cost was specified (i.e. “costs reported in 2003 USD”).Background and Methodology
Comparing as-built construction costs can offer some clues as to whether other countries are building public transit systems more cost-effectively. However, there are several caveats and challenges when attempting to make a true “apples to apples” comparison between domestic and international construction costs. Inconsistencies in cost reporting and data availability make it difficult to determine what goes into a project’s “sticker cost” (is rolling stock included? Does the project include a maintenance facility?). Detailed cost breakdowns are typically not reported for most projects, and in the event that they are, there may be vast differences in the categories used. Cost breakdowns for federally funded projects are reported using nine Standard Cost Categories (SCCs): However, as the Eno team discovered when reviewing select cost breakdowns received through FOIA requests, some agencies in the U.S. also use their own internal methodology to track costs, especially for projects that are locally funded. Rather than reporting project costs for items like stations, sitework, and stations, costs in some cases are broken down by project phase (i.e. preliminary engineering or final design). Cost breakdown methodologies among various countries can vary even more. The challenge of accurately comparing construction costs has been well documented. The GAO was tasked with producing a report analyzing construction costs in the United States and other peer nations, and faced similar challenges in data availability and reporting: “The availability and comparability of international rail transit project cost data limits comparisons between projects. Stakeholders mentioned limitations such as sponsors’ and contractors’ reluctance to report cost data, differences in how sponsors and contractors categorize and report costs, and differences in what costs are included in estimates.” These data challenges were even the subject of a 2019 New York Magazine profile aptly titled “Here’s Why We’ve Failed to Figure Out Why Infrastructure Costs So Much.” The profile documents the GAO’s data struggles in more detail and includes additional anecdotes from similar efforts to compare construction costs across regions and countries, including a 2018(?) report from the Regional Plan Association in New York City. In addition to highly variable data reporting practices, cost comparisons are also constricted by the fact that some projects are simply more complex than others, perhaps by virtue of their features and design, the urban and/or geotechnical environment in which they operate, or other technical factors. When inputting projects, variables like grade alignment, number of stations, and station spacing can help capture some elements of a project’s complexity. In-depth case studies will be able to offer more insights on the specific complexities and dynamics of individual projects. While collecting data on construction costs, we have kept these caveats in mind and attempted to document instances where rolling stock and land acquisition are included in a project’s reported cost, and subtract whenever possible. This information was not readily available for many of the projects in the database.Challenges and Caveats to Consider when Comparing Construction Costs
SCC
Description
10
Guideway & Track Elements
20
Stations, Stops, Terminals, Intermodal
30
Support Facilities: Yards, Shops, Admin. Bldgs
40
Sitework & Special Conditions
50
Systems
60
ROW, Land, Existing Improvements
70
Vehicles
80
Professional Services
90
Unallocated Contingency
100
Finance Charges
The caveats and challenges in data reporting outlined above limit the extent to which projects can be thoroughly compared with one another. When comparing construction costs, it is important to avoid drawing sweeping conclusions or over-interpreting trends. Keeping these caveats in mind, there are still a few interesting takeaways that inform our research and spark additional questions that in-depth case studies can answer with more accuracy.Analysis
The caveats and challenges in data reporting outlined above limit the extent to which projects can be thoroughly compared with one another. When comparing construction costs, it is important to avoid drawing sweeping conclusions or over-interpreting trends. Keeping these caveats in mind, there are still a few interesting takeaways that inform our research and spark additional questions that in-depth case studies can answer with more accuracy.
Comparing average grade alignments (measured as percent of the project alignment that is at-grade) of U.S. projects with Non-U.S. projects in the database reveals a few interesting takeaways. First, heavy rail projects outside of the U.S. appear to be largely below grade compared to U.S. projects. The average proportion of a project that is at-grade in the U.S. is over three times higher than non-U.S. heavy rail projects (29% vs 8%, respectively). The opposite dynamic exists for light rail/tram projects, which appear to be more complex in the U.S . On average, the non-U.S. light rail/tram projects in the database were at grade for 84% of their alignment, compared to 77% of U.S. light rail projects.
Plotting project grade alignments (percent of total alignment at-grade) against costs-per-kilometer illustrates how most U.S. rail transit projects in the database are built primarily at-grade in contrast to non-U.S. projects. In terms of construction costs, other countries are able to build mostly below-grade projects at a cost comparable to some largely at-grade projects in the U.S. This pattern can be seen more clearly when restricting the sample to projects built at a cost of <$300 million-per-kilometer (click and drag cursor to select projects below this cost threshold, release, and select “Keep Only”). These patterns suggest that the U.S. is able to build fully at-grade transit at a fairly cheap cost, but that other countries are able to build fully tunneled projects at a comparable cost to U.S. projects in the $80-$200 million per kilometer range. In-depth case studies will help us better understand the extent to which there is a tunneling premium in the United States, and whether technical standards, governance, project management, contracting practices, regulation, or other factors may explain the large share of relatively inexpensive tunneled rail lines outside of the U.S. [/av_textblock] [/av_section]
Eno is an independent, non-partisan think-tank that shapes public debate on critical multimodal transportation issues and builds an innovative network of transportation professionals.
1629 K Street NW, Suite 200
Washington, DC 20006
P: 202.879.4700