Tuesday, April 12, 2016

Estimated Costs Of First Phase Of Red Line Already Up 60%!

Advance Indiana took a look back at the August 2015 budget presentation IndyGo made to the Indianapolis City-County Council for its 2016 budget. Imagine our surprise when we saw the original amount IndyGo's leadership told council members the first phase of the Red Line from Broad Ripple to the University of Indianapolis would cost to construct. How about $60 million? Yep, that's what IndyGo planned to spend building that 13.4 mile stretch of the 35-mile planned bus rapid transit line.

At that time, IndyGo said it anticipated receiving a $48 million grant from the Federal Transit Administration. It planned to match that with $12 million in local match money, which included tapping Gov. Mike Pence's Regional Cities grant money. Of course, IndyGo got passed over for the state grant money. By the start of this fiscal year, IndyGo announced it had been awarded a $75 million grant to put towards the $96 million projected cost of that same leg of the Red Line it earlier projected would cost just $60 million, or a cost difference of about 60%.

So IndyGo just 8 months ago was telling City-County Council members it could build the first phase of the Red Line for about $4.5 million per mile. It also told council members it would only cost about $6 million annually in additional operating costs once the first phase of the Red Line becomes operational in 2018. The construction cost  has now jumped to more than $7 million per mile. Experts say bus rapid transit lines on average range in cost from $15 to $25 million per mile.

IndyGo says it plans to build the Red Line regardless of whether a proposed quarter percent income tax increase is approved by Indianapolis voters this November. It claims the income tax revenues are not needed to finance the capital costs for building all of the planned BRT lines, which would include a total of three over the next five years. That income tax increase would generate $56 million in new revenues annually, more than double what IndyGo currently collects from its local property tax levy, which includes a maximum $16 million special levy, up from $10 million last year. IndyGo now says its total operating budget will grow from $70 million a year to $108 million a year once with the additional costs of operating a BRT. Suffice it to say, IndyGo isn't very good at estimating costs.

When IndyGo first announced plans to build its new downtown transit center on Washington Street across the street from the City-County Building, which is aptly being named in honor of the late U.S. Rep. Julia Carson, a career politician who mastered the craft of pilfering public tax dollars, it estimated total construction costs at $20 million. Costs for the new transit center have already ballooned nearly 33% to $26.5 million. That difference has to be made up with local dollars since the federal grant only covered $13.5 million of the costs. The transit center was originally supposed to open this year, but little progress seems to be taking place at the site. When it comes online, IndyGo estimates it will cost another $700,000 in its budget annually to operate. Bus line changes to accommodate the new transit center are expected to add $1.3 million in annual operating costs. IndyGo riders, incidentally, only chip in a little more than $11 million in fares to cover IndyGo's annual operating budget, less than 17% of the annual cost to operate the bus system.


Anonymous said...

Transit growing pains seem to plague most American cities. I'm only thankful that we get Federal money to help with construction. At least we shelved all those awful railway plans that would have cost even more. Surely we can figure out how to afford to run an efficient bus service around Indy.

Anonymous said...

Fraud- fraud- fraud!

Anonymous said...

As I understand it, the $75 million was awarded but not funded. Supposedly the funding was going to come from Obama's $10/bbl oil tax which has no chance of passing in Congress. Can you verify this Gary? I can't remember where I read it. I also read that without the $75 million this thing is dead on arrival. I honestly believe the tax is going to be collateralized and borrowed against to fund construction, which means there will be no tax money to make up the operating shortfalls, which in turn means that there is another tax in your future.

Anonymous said...

Here's the link from the Red Star that talks about the funding: http://www.indystar.com/story/news/2016/02/12/red-line-funding-no-sure-thing/80245932/

The money quote: “Nobody believes the oil tax will pass this year, so cities can’t count on these grants in their budgets,” Collender said. “It could happen, but I would give it less than a 50 percent chance.”

If this is valid, they don't have the $75 million yet. They're lying. I'm convinced the banksters have presented a "can't miss" plan to collateralize future tax revenues as a loan to fund construction. I no longer live in Indy, but if I did that's what I would want to know. Then, if that's the case, I would get the best PR firm I could find and shred these immoral criminals. This is gonna cost the average Hoosier a fortune. It's much worse than is being reported.

Gary R. Welsh said...

The money is in Obama's budget, but it's still subject to approval by Congress. Given the fact that the GOP-controlled Congress spends as recklessly as the former Democratic-controlled Congress, I would be surprised if the funding for it didn't survive the budget process.

Anonymous said...

What a surprise, our crony career parasites- a/k/a Indy Democrats and Republicans- lie to us.

What a bigger surprise... the useless, should-be-abolished Indianapolis City County Council will do ----- NOTHING. Except let it happen, let is stand, then moan and bitch and point fingers at every culprit but themselves.

Anonymous said...

At the latest CCC confab to put the IndyGo tax increase on the ballot we found out a few things; the Red Line will bypass normal stops along College Ave.; no new routes will be added from the tax increase; current routes will be straightened out to achieve a rapid status; widows and orphans will greatly benefit; Christine Scales knows more about the plan's pitfalls than the it-won't-cost-me anything fat cats from the Chamber of Commerce.
Apparently the plan does ridiculously very little for Marion County riders other than saving some users 15 minutes of waiting and travel time at an excessive cost to taxpayers.