Thursday, August 11, 2011

California's high-speed train to nowhere gets more expensive

When the California High Speed Rail project was put before voters, its backers estimated that it would cost $33 billion. Fairly quickly thereafter, planners revised that estimate to $43 billion, a 25% increase.

But that seems to have been giddily overoptimistic. According to the Mercury News, the state now expects the first leg of California's high speed rail is to come in over budget. Waaaaaaaay over budget (H/T Reihan Salam):
The California High-Speed Rail Authority's new cost estimates released Tuesday show the initial stretch of construction between Merced and Bakersfield will cost $10 billion to $13.9 billion depending on how it's built. Project planners had previously pegged the section at $6.8 billion.
And this is the part that they're building first because it's so cheap--not a lot of expensive real estate (or angry, politically powerful neighbors in the way). The Mercury News says that if the whole project's costs blow up the way the first leg has, the whole project will cost somewhere between $63 and $87 billion. ...

Who's going to lose their job over this project? It was passed by initiative, so politicians aren't really on the hook. The people in charge of the cost estimates are all civil servants.
--Megan McArdle, Atlantic Monthly, on a terrible deal getting even worse