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Ugh... Building the M4 in Budapest was plagued by scandals, delays, and cost overruns, and ridiculed for having cost a whopping €1.6 billion for the entire line

Ugh... Building the M4 in Budapest was plagued by scandals, delays, and cost overruns, and ridiculed for having cost a whopping €1.6 billion for the entire line. Salaries over here are perhaps a fourth or a fifth of what they are in the US, but it still boggles the mind that building one metro station would cost $1 billion. How do prices get that high in the US? Are private contractors too intent on pocketing fat profits? Or is it related to health, tort, or other insurances, or a privately funded pension system?

rayiner 7y ago
Nobody knows. "Fat profits" doesn't seem to be it. The contractor for the Maryland light rail, Fluor Corporation, has a 2.6% profit margin according to audited public disclosures. One big thing is environmental laws. Government projects in the U.S. must follow something called NEPA, and create an environmental assessment of the project. In practice, every sentence of that report is subject to litigation. The average environmental report for a transit project therefore takes more than six years to prepare. The Purple Line in Maryland was tied up in years of litigation: > n August 2016, U.S. District Court Judge Richard J. Leon found that the Maryland Transit Administration and the Federal Transit Administration did not study whether Metro's maintenance issues and ridership decline would affect the Purple Line.[53] Judge Leon decided to vacate the Purple Line's federal approval.[53] A federal funding agreement cannot be signed without the reinstatement of the environmental approval, and Maryland has said it cannot afford to build the Purple Line without sufficient federal funding.[53][54] On August 21, 2017, despite the ongoing court case over the environmental analysis, $900 million of federal funding was granted for the light rail project.[55] On December 19, 2017, the U.S. Court of Appeals for the D.C. Circuit ruled in favor of the Purple Line, specifically stating that declining ridership on the Washington Metro system does not require Maryland to complete a new environmental study for the Purple Line.[13] This federal appeals court ruling allowed for construction to continue and effectively ended the three-year legal battle surrounding the 16-mile light-rail line project.[12] This not only adds to the cost--contractors must build in tons of padding because projects can be litigated even after construction starts. But it makes it impossible to build sustained public support for transit projects. People get worked up about a project, vote for funding, and then literally nothing visible happens for half a decade or more while paperwork gets done. It kills momentum completely.

rayiner 7y ago

Nobody knows. "Fat profits" doesn't seem to be it. The contractor for the Maryland light rail, Fluor Corporation, has a 2.6% profit margin according to audited public disclosures. One big thing is environmental laws. Government projects in the U.S. must follow something called NEPA, and create an environmental assessment of the project. In practice, every sentence of that report is subject to litigation. The average environmental report for a transit project therefore takes more than six years to prepare. The Purple Line in Maryland was tied up in years of litigation: > n August 2016, U.S. District Court Judge Richard J. Leon found that the Maryland Transit Administration and the Federal Transit Administration did not study whether Metro's maintenance issues and ridership decline would affect the Purple Line.[53] Judge Leon decided to vacate the Purple Line's federal approval.[53] A federal funding agreement cannot be signed without the reinstatement of the environmental approval, and Maryland has said it cannot afford to build the Purple Line without sufficient federal funding.[53][54] On August 21, 2017, despite the ongoing court case over the environmental analysis, $900 million of federal funding was granted for the light rail project.[55] On December 19, 2017, the U.S. Court of Appeals for the D.C. Circuit ruled in favor of the Purple Line, specifically stating that declining ridership on the Washington Metro system does not require Maryland to complete a new environmental study for the Purple Line.[13] This federal appeals court ruling allowed for construction to continue and effectively ended the three-year legal battle surrounding the 16-mile light-rail line project.[12] This not only adds to the cost--contractors must build in tons of padding because projects can be litigated even after construction starts. But it makes it impossible to build sustained public support for transit projects. People get worked up about a project, vote for funding, and then literally nothing visible happens for half a decade or more while paperwork gets done. It kills momentum completely.