It’s not just the Second Avenue Subway: Nearly all urban rail projects in the US cost much more than their European counterparts.
In late December, The New York Times published a bombshell article by Brian Rosenthal about high construction costs on the New York City subway. Doing painstaking investigative work building on a set of numbers I blogged about in 2011, Rosenthal showed how, at $2.6 billion per mile, New York’s Second Avenue Subway broke records for its costs, and that all of the reasons subway officials offered were excuses. The article documented poor contracting practices, bad management, and union featherbedding.
Unfortunately, what Rosenthal portrays as a New York affliction is in fact a nationwide problem. The construction costs of American rail transit are a multiple of such costs in peer countries, for both subways and light-rail lines. Many US lines that would be easy to justify economically if they cost as much as in France or Sweden are marginal at current American costs. Every city that hopes to expand its transit network should pay closer attention to best industry practices abroad if it wants its investments to be cost-effective.
How much does rail cost? The approximate range of underground rail construction costs in continental Europe and Japan is between $100 million per mile, at the lowest end, and $1 billion at the highest. Most subway lines cluster in the range of $200 million to $500 million per mile; in Amsterdam, a six-mile subway line cost 3.1 billion Euros, or about $4 billion, after severe cost overruns, delays, and damage to nearby buildings. The Second Avenue Subway is unique even in the US for its exceptionally high cost, but elsewhere, the picture is grim by European standards.