AUSTIN (KXAN) — New cost estimates for Austin to add two light rails as part of Project Connect are nearly double the original numbers, according to Capital Metro. The cost estimate now sits at $10.3 billion.

In a memo Thursday, Project Connect Program Officer David Couch outlined updates to the program, a transit overhaul designed to improve the city’s current mass transit network.

Originally, the two lines and a tunnel were expected to cost $5.8 billion ($2.5 billion for the Orange Line, expected to stretch from north to south Austin; $1.3 billion for the Blue Line, expected to connect downtown to the airport; and $2 billion for a tunnel).

The new estimate adds $4.5 billion to the initial amount. That includes an additional $600 million for the Blue Line, $1.8 billion for the Orange Line and another $2.1 billion for the tunnel.

Project Connect said it’s normal for cost estimates to be refined as the process moves forward and added “the three specific cost drivers that are impacting changes in the cost estimates are real estate, inflation/supply chain and scope refinement/change.”

• Real Estate: Initial estimate was $250 million, but a “significant increase” in the amount of land affected and increased cost of real estate now leads to a $940 million estimate.
• Inflation/Supply Chain: Initial estimate included a 3.5% annual cost escalation, which is now bumped to 5% in anticipation of future costs because of trends in the supply chain and labor market. That’s about $380 million total now.
• Design changes: Initially, the tunnel was supposed to be 1.56 miles, but now the project is looking at a 4.19 mile tunnel, new underground stations and a pedestrian concourse. Plus, new information and the need to move utilities and drainage needs increased the cost.

“I’m not surprised,” said Michael Harpel, owner of Vinyl Beauty Bar near the MLK, Jr. MetroRail station. “Just with the price of construction and everything right now and materials and supply chain issues and coming out of a pandemic that we’re still in — everything’s gone up and, you know, basically build out costs, you need to multiply times two, is what we’ve learned with our business as well.”

Harpel doesn’t currently use the commuter rail often but said he’d like to.

“I would like to use the [commuter] rail on a regular basis, if there are more options. There’s a single train right now,” he said.

His business is right across the street from the MLK, Jr. rail stop, which was strategic. He hopes expanding access will help people avoid rising gas prices, be more environmentally friendly and help more of his employees.

“We did have one employee who actually lives in Leander and was able to use it, which is kind of amazing,” he said.

Derrick Wellington said the costs are jarring, but he still thinks it’s an important project.

“I think we should go ahead and do it, because I like to travel and can’t really get far on here as of now,” said Wellington, who takes the rail home from school every day. “I got friends like in almost every area now, so I’d just go hang out.”

Project Connect leaders reiterate in the memo at this time, they aren’t planning for any additional tax increases to help pay for extra costs, and “the parties will need to meet its commitment to voters
to deliver this program with the allocated revenue sources.”

“As the cost estimates for the program change, there is not a requirement to change the tax rate that funds the program,” CapMetro emphasized in a statement to KXAN Friday. “Instead, changes in program costs could result in adjustments to project phasing to balance funding of construction and operations of the system. The Project Connect team remains fully committed to fulfilling the promise to build the program voters approved in November 2020.”

In the memo to city leaders, Couch said they’re also “cautiously optimistic” the infrastructure bill signed by the President will bring more federal funds here than they initially thought — offsetting some of those costs. He added they won’t know their final federal share of money for the light rail projects until 2024.

The MetroRapid and MetroRail Red Line improvements are on schedule and within their original program cost estimates, the memo said. The MetroRapid costs came out to $101 million total, with $65.6 million coming from federal money. People will be able to use it starting in 2023. MetroRail Red line improvements include a new station near Q2 Stadium, with a total cost of $58.7 million.

Project Connect has been working to hold community meetings on the final design and will continue to do so, it said.

“The community and stakeholder input to the design review process has been incredible, and we very much appreciate the volume of interest in the light rail design. These comments are being incorporated and will be
reflected in the 30% design and cost estimates,” which are expected to be finalized this summer, the memo said.