Most of the railroad and transit megaprojects weren’t needed to support regional or local population growth but were attempts to get people to drive less

The Antiplanner

Rail transit is finally getting the attention it deserves in Washington, DC. Early this month, Senator Joni Ernst (R-Iowa) released a report describing billion-dollar boondoggles. While the star is California’s high-speed rail, many of the projects criticized by the report involve rail transit, including Honolulu’s rail project and Maryland’s Purple Line. The projects are not only billions of dollars over budget, many of them are years behind schedule.

As a starting point, Ernst used a one-page Department of Transportation “annual report” of federally funded projects that the Biden administration had refused to release, but which was recently released by the Trump administration. The list included five Federal Aviation Administration-funded projects that had no cost overruns, three Federal Highway Administration-funded projects whose cost overruns averaged 75 percent, three transit projects whose cost overruns averaged 80 percent, and three Federal Railroad Administration-funded projects whose cost overruns averaged 395 percent.

I’m sure it is only a coincidence that the name of the report, Off the Rails, was also the name of a 2023 report I wrote about Minnesota’s rail transit boondoggles, one of which currently has an $800 million cost overrun. Ernst specifically calls out this project as one that should have been included in the DOT report but was not.

Of the projects in Ernst’s report, the one (other than California high-speed rail) with the greatest cost overrun is the Honolulu rail line, which is also expected to be completed 11 years late. The report didn’t mention that operating the Honolulu rail line last year cost taxpayers more than $70 for every passenger it carried. On a percentage basis, however, the Maryland Purple Line wins, as it had a 130 percent cost overrun compared with 94 percent for Honolulu.

The primary reason for these cost overruns is not that a project involves rails or is for transit as opposed to some other mode but that the agencies managing the projects treat taxpayers as a bottomless source of funds. At one time, few highway projects had significant cost overruns because they were funded mainly out of fuel taxes and other user fees, and highway engineers could predict how much those fees would generate and plan accordingly. Now much highway funding comes from general funds, and all engineers have to do is cry “crumbling infrastructure” and Congress and the states throw gobs of money at them.

The same is true for transit but apparently not for the minor airport and aviation projects considered in the DOT report. Yet major projects, such as Denver International Airport, suffered major cost overruns. The lesson lawmakers and others should learn is that all megaprojects should be suspected of having costs underestimated and benefits exaggerated.

With the U.S. population expected to level off soon, there shouldn’t be a lot of need for megaprojects anyway. Most of the railroad and transit megaprojects weren’t needed to support regional or local population growth but were attempts to get people to drive less. The fact that that has never worked doesn’t seem to keep anti-car people from proposing new boondoggles. Perhaps Ernst’s report will help keep Congress from funding them in the future.

The Antiplanner is a forester and economist with more than 50 years of experience critiquing government land-use and transportation plans.