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Seattle Officials Knowingly Lowballed Streetcar Costs by 50 Percent

Another transit project's costs go off the rails.

Seattle StreetcarSteve Morgan/Wikimedia CommonsWhen Seattle officials claimed that a proposed one-mile streetcar extension would boost ridership by more than 400 percent and would cover half its costs with ticket sales, some ordinarily transit-friendly city council members wondered whether those numbers were too good to be true. They were.

Last week The Seattle Times published a memo by the King County Metro Transit Division, which is contracted to operate the streetcar. The memo says those projected operating costs for the Center City Connector (C3) project were 50 percent below Metro's estimates. The Seattle Department of Transportation (SDOT) concealed Metro's numbers when shopping around for money from local and federal officials.

"To find out that that information may have been, if not inaccurate, at least disputed—we should have known what these disputes are—is maddening," Seattle Councilmember Mike O'Brian said at a briefing.

SDOT projected that it would need 70 staff members to operate its streetcar network after the C3 expansion, which would cost it some $16 million a year. Metro calls this a significant underestimate, saying the new streetcar line will need 136 total staff and cost $24 million annually to operate.

On Monday, Mayor Jenny Durkan ordered an independent review of streetcar costs, sidestepping her own transportation department entirely.

The C3 project—which started construction late last year—has had a rocky recent history, repeatedly overshooting cost estimates while coming under fire from city politicians.

In 2014, SDOT released a detailed evaluation report for the C3 project that estimated its capital costs at between $108 and $115 billion in estimated 2017 dollars. A 2015 evaluation by the Federal Transit Administration (FTA) pegged the total capital costs at $134.88 million. A year later this was revised upwards again, to $166 million. Now the project is said to cost $177 million.

By 2017, councilmembers were starting to raise doubts about the utility of the new streetcar line and the financial risk it posed to the city.

In June of that year, the council voted to accept the first $50 million of a $75 million grant from the FTA's Small Starts program on the condition that SDOT come back to the council with a detailed plan of the operating costs in the fall. At that time, SDOT was already working on such a plan for FTA, which it submitted in July without any review from its partner agency, Metro—which, remember, would be the actual agency operating the streetcar.

When Metro got wind of SDOT's plan, its staff was shocked at how low the budget estimates were. They told the department repeatedly throughout August that it was lowballing the amount of money it would need. According to the memo, these concerns were ignored or waved away.

When it came time to present that report on the operating costs, SDOT submitted the same low estimate to the City Council.

Already SDOT was predicting that ticket fare would cover an incredible 56 percent of the operating costs of its new line, far above what most other streetcar systems in the country manage. New operating cost estimates coming to light make these projections seem even more fanciful.

This is hardly surprising given how often streetcar projects overshoot their budgets and underperform on ridership.

Transit agencies rarely pay a price for missing the mark like this, given the commitment cities have already made by the time the cost overruns start turning up. They don't want to pull the plug that far into the project, and so the increased costs are passed on to local taxpayers, who are asked to shell out more money or accept reduced services for what is ultimately more of a fashion statement than a real transportation solution.

Photo Credit: Steve Morgan/Wikimedia Commons

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  • Thrackmoor||

    Who could have guessed that a gubmit agency would lowball a bid?

  • Fist of Etiquette||

    "To find out that that information may have been, if not inaccurate, at least disputed—we should have known what these disputes are—is maddening," Seattle Councilmember Mike O'Brian said at a briefing.

    Yeah, they sure pulled the wool over your eyes.

  • NotAnotherSkippy||

    And this is why we need unelected bureaucrats in charge, so this can never happen again. Wait...

  • El Oso||

    What happened to self-driving streetcars?

  • Johnimo||

    Left wing bureaucrats are universally corrupt because lefties, in general, believe the ends justify the means. Furthermore, they believe the non-left just doesn't understand how good and noble their aims are. They are a most disgusting group of people.

  • sarcasmic||

    Their aims are no noble and well-intentioned that any disagreement or criticism can only be explained by bad intentions.

  • BYODB||


    They don't want to pull the plug that far into the project, and so the increased costs are passed on to local taxpayers, who are asked to shell out more money or accept reduced services for what is ultimately more of a fashion statement than a real transportation solution.


    It is amusing, in an infuriating kind of way, that sunk costs aren't really much of a concern for Seattle. I can only say if you choose to live there on purpose, you're getting what you asked for I guess.

  • Citizen X - #6||

    Eventually getting 'sploded when Mt. Rainier inevitably goes off?

  • BestUsedCarSales||

    That, and only that, is the reason I'm trying to leave.

  • BYODB||

    Oh god, you live in Seattle? I'm so sorry, but the one time I was there I didn't necessarily hate it.

    Of course, my Irish heritage means the upper Northwest is basically one of the few places in American I can walk outside without fear of the sun.

  • BestUsedCarSales||

    No, I actually live in a town called Issaquah, but it's a suburb of Seattle.

  • Libertarian||

    The term "sunk cost" is not correctly understood by most people.

  • BYODB||

    True enough, Seattle already spent a shit ton of money they can't get back so I guess they better double down.

    *facepalm*

  • Tionico||

    its also called being pot bound.

  • Libertarian||

    Did the Seattle Times follow the money to see who the contractors are? To see if any owners are related to any of the politicians or bureaucrats involved in this boondoggle?

  • Trollificus||

    No, but they did find a phone call from someone related to a Trump staffer to someone in Seattle with a Russian-sounding name. They're hoping to get a Northwest Journalism "Woodward/Bernstein" Award for that.

  • Rich||

    Transit agencies rarely pay a price for missing the mark like this, given the commitment cities have already made by the time the cost overruns start turning up. They don't want to pull the plug that far into the project

    How about pull the plug when the mark is missed, and use the fiascoed infrastructure as a memorial to the transit agency?

  • sarcasmic||

    Are these the same people who tell residents to ride the S.L.U.T.?

  • Citizen X - #6||

    Yeah, but then they get real mad when you giggle.

  • damikesc||

    Nobody is being charged with lying. I notice.

  • JWatts||

    +1

  • JWatts||

    Or held accountable to even the slightest degree.

  • No Longer Amused||

    All of Seattle's mass transit options are money losers.

  • retiredfire||

    There isn't a "public transit" system in America, and probably the world, that can operate on just the fares they collect.
    The actual cost are so great that the fare would be so high that no one would ride it.
    So, they all need some kind of outside funding source - usually charged to drivers, or a sales-tax increase - to be able to operate.
    A lot of the gasoline taxes collected go to these kinds of things, rather than fixing the roads, as advertised.

  • Migrant Log Chipper||

    The real story isn't the bloated capital costs, it's the mind boggling operating costs including pensions that will be hoovering wallets 60 years from now. It's the gift that keeps on giving, don't 'cha know.

  • retiredfire||

    @Migrant Log Chipper,

    Contributions to pensions are part of the overall pay package, just like the portion of Social Security that your employer pays.
    The contributions from taxpayers, for public workers' pensions, ends when the employee starts collecting his or her pension. The payments come from a fund that has been filled through employee and employer contributions plus - and this is where it is different than the Social Security you will collect - investments that increased the value of the fund.
    You are mis-informed as to how these pensions work. But you are not alone.
    Social Security is the pension that taxpayers will have to keep funding, regardless of your work status, not private or public pension systems.

  • My Dog Bites Better Than Yours||

    SDOT projected that it would need 70 staff members to operate its streetcar network after the C3 expansion, which would cost it some $16 million a year. Metro calls this a significant underestimate, saying the new streetcar line will need 136 total staff and cost $24 million annually to operate.

    I am confused. I thought we were talking about a one mile streetcar extension to an existing line. What are they doing, carrying the people by sedan chair?

  • Ron||

    so Trump's not the only politician that lies? I'm amazed

  • A Thinking Mind||

    I am shocked, SHOCKED, to find that graft is going on in here.

  • Griffin3||

    How is this not fraud? Someone lied in order to get this passed, and this is probably documented out the butt, if you were to pull all the emails. Roll some heads.

  • Galane||

    It's the multi-million dollar mile.

  • Vitae Drinker||

    In 2014, SDOT released a detailed evaluation report for the C3 project that estimated its capital costs at between $108 and $115 billion in estimated 2017 dollars. A 2015 evaluation by the Federal Transit Administration (FTA) pegged the total capital costs at $134.88 million A year later this was revised upwards again, to $166 million. Now the project is said to cost $177 million.

    These terms are not interchangeable. I'm guessing you meant millions, not billions?

    Since everyone is an editor anymore, you'd think they would be able to, you know, edit.

  • AD-RtR/OS!||

    Seattle's moves and shakers consistently confuse their fantasies with reality......
    this is just one of those many confusions.

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