High Speed Cost Escalation Record in California: 2008 Projections Fall Short

http://www.newgeography.com/content/002382-world-high-speed-cost-increase-record

Excerpt…

Cox/Vranich Projection Low: In 2008, Joseph Vranich and I authored the Reason Foundation’s The California High Speed Rail Proposal: A Due – Diligence Report. Based upon the cost escalation we predicted in that report, our cost escalation estimate for Phase I would have been between $49 billion and $61 billion (Note 2). Little did we expect that our maximum cost escalation figure would turn out to be too conservative and be exceeded even before the first shovel had been turned.

Rippling to Florida: There has already been a ripple effect from California’s record cost escalation. My Reason Foundation report on the Florida high speed rail project (The Tampa to Orlando High Speed Rail Project: A Florida Taxpayer Assessment) used a comparison to the first segment of the California system to produce a maximum cost overrun estimate of $3 billion for the Florida system. Had the new cost estimates been available at the time, we would have projected even higher cost overruns. Of course, Governor Rick Scott canceled that project to shield the taxpayers of the state from obligations not only for cost overruns but also for operating subsidies.

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