Shame On The Voters?

" The public expected the impossible, in other words, and by gosh someone had better deliver. "


Yes, that's right, a recent Rocky Mountain News editorial took the time to chastise the voters for expecting the impossible. Are the voters expecting the impossible? They seem to think so. The main problem I have with this claim is that they never touch on why it is the voters have come to expect the impossible? Could it be because they were promised the impossible in 2004?

Sales Tax Money For RTD

Keep this in mind every time you buy something.

Denver Post :

FasTracks is the nation's largest transit expansion program, one that metro Denver voters backed in 2004 when they approved an additional 0.4 percent sales tax to build the project. The increase was on top of the 0.6 percent sales tax that RTD relies on to run the bulk of its existing transit system.

Colorado Construction Cost Increases in 2007

http://www.masstransitmag.com/web/online/Top-Transit-News/FasTracks-Price-Tag-Swells/3$6318

The Colorado Construction Cost Index, a measure of costs for transportation projects maintained by the Colorado Department of Transportation, increased 6.1 percent last year.

Fastracks West Corridor : 40% Higher Cost And Less Than Promised

As mentioned previously, the West Corridor for RTD's Fastracks is being stripped to the bone. They're single tracking part of the line, building smaller stations, building lines that will require more ongoing maintenance after storms, putting riders at risk in delaying security measures and a slew of other less-than originally promised features.

RTD has locked in contracts for the line so that it will end up costing about 40% more than they told the voters it would.

http://www.masstransitmag.com/online/article.jsp?siteSection=3&id=6318&pageNum=4


The Regional Transportation District board approved a higher budget for the West Corridor light rail line through Denver, Lakewood and Golden, locked in contract prices and authorized start of work under two construction deals.

11.5 percent budget increase would take the project from $634.7 million to $707.6 million.

$338.7 million is the contract figure with Denver Transit Construction Group. A $62.6 million contract is with Balfour Beatty. They are so-called Guaranteed Maximum Price deals, under which the contractors bear the responsibility for future cost increases.

* The only exception is that RTD has agreed to provide up to $5 million to cover some increases in construction material costs that Denver Transit Construction Group might encounter.

Fastracks North Corridor 50% Over Budget

The West Corridor isn't the only FastTracks line in trouble. The North Corridor is already 50% over budget.

http://www.masstransitmag.com/online/article.jsp?siteSection=3&id=6318&pageNum=3

For example, planners on the Fastracks North Metro Corridor from Denver Union Station through Commerce City and Thornton completed a noise analysis this year indicating they will have to include more than 10 miles of noise-blocking walls along the Union Pacific freight tracks that they plan to use for diesel-powered commuter trains.

Originally, the North Metro Corridor was budgeted for only about eight miles of noise walls.

That cost increase, from $12.7 million to $16.5 million, has yet to be reflected in the North Metro Corridor's $637.2 million share of the overall FasTracks budget. Two years ago, North Metro's estimated cost was $420 million.

Fastracks Costs : More Than Construction Inflation

Seeing Reuteman at the Denver Post arguing that the tax payers should give RTD even more money for Fastracks was annoying to say the least. Reutman's argument is based on the semi-false claims that RTD has been trumpeting this whole time. That is, the aren't getting as much in sales tax revenues as they told the voters they would and that their large construction cost increases were unforeseen. The problem is, these claims are only half-truths.

Earlier in this decade when RTD was getting ready to go to the voters we were seeing costs of commodities like copper and aluminum outpacing inflation. Steel prices were rising quickly back then. For example, Chinese consumption was increasing by 20% per year (about 1/2 of the total US annual output of steel). RTD had no business making the sort of cost assumptions back then that they did. They ignored what was happening then and they're paying the price today. It's not just that recent rises have been so steep, it's that they underestimated increases as they were happening 5-10 years ago. Recent increases make the situation that much worse.

We can see this in the West Corridor. The West Corridor was originally going to cost $508.2 million (RMN). Ac couple years after the vote, the cost had gone up to $744 million. That's a 40% increase. Even over a few years higher than projected construction costs would have not led to 40% more.

RTD trimmed down the costs for the West Corridor including reducing potential capacity by reducing station size and single tracking part of the line. That brought the cost down to $634 million. In the year since then the project cost for the West Corridor shot back up to $707.6 million (RMN).

RTD says that the lion share of that change was due to construction costs increases. How can that be? The Colorado Construction Cost Index went up 6.1% last year. Yet costs on the West corridor went up 12%. They've aleady made about $275 million worth of "cuts" on a line that was originally going to cost $508.2 million. There's more to the issue than just unanticipated construction cost increases.

RTD's Hail Mary Pass

I'm a little curious how an operation that's 80% funded by tax payers has "profits".

Denver Post :
"This is the largest developing market in public-private partnership infrastructure," said Crooks, who was in Denver last week at a national conference on public-private partnerships, or PPPs.

RTD expects private companies to bring at least $500 million of their own financing to the DIA train/Gold Line/maintenance center project.

In return, the private group would get a dedicated stream of payments from RTD for up to 50 years that would be structured to pay off construction debt, fund the operation
and maintenance of the trains and reward the consortium with some measure of profit.

West Corridor : 38% Over Budget

RTD's 12.1 mile West Corridor, part of the Fastracks project, is nearly 40% over budget. Last year RTD's budget for the line hit $744 million. They reduced it to by $634 million through several cost cutting measure such as :

• Single track the few miles of the line, reducing rush hour frequency to a train every 15 minutes instead of 5
• Number of LRT cars a station can hand from 4 to 3.
• Build less parking spaces (for example, one ramp is planned to have 400 spaces, half of the originally recommended 800).
• Building the rail bed to withstand 5-year storms instead of 100-year storms.
• Eliminating some stations
  

These weren't enough. As mentioned, costs have continued to rise back up to $707.6 million. This has prompted even further cost cutting measures by RTD. These include :

• Reducing landscaping at stations.
• Further dumbing down station design to make building them cheaper
• Delaying installing safety equipment such as security cameras and emergency phones.
• Reducing furnishing at stations.
• Delaying constructing pedestrian bridges.
• Reducing the capacity of the bike path that will parallel the line.

Sources

• http://www.denverpost.com/news/ci_9546240
• http://www.rockymountainnews.com/news/2007/Oct/26/rtd-cost-cutting-hits-sixth-avenue-segment-hard/
• http://www.rockymountainnews.com/drmn/local/article/0,1299,DRMN_15_5277508,00.html

Renewables Are Cheaper?

So while the weirdos at the Independence Institute and the rest of the Republican Party insult our intelligence with bizarre and unsubstantiated claims of higher prices from renewable energy,

Seeing this one threw me back for a moment. I haven't ran across renewable supporters before that would actually claim renewables are less expensive. Nor have I seen someone straight up claim that claims of higher prices from renewables are unsubstantiated.

Alright, maybe I had missed something. I went to do Rocky Mountain News and did a quick search on "wind power cost coal colorado". The first article I open from my search has this :

The utility says fully subscribed customers of WindSource will have to pay higher premiums - about $13 more per month compared with regular customers - because they aren't benefiting from declining natural gas prices enjoyed by regular customers.

So is Xcel simply charging more for wind power because they're greedy? If so, why is the PUC allowing them to claim that wind power is more expensive? More so, why is the PUC allow Excel to charge more for wind power?

The PUC allows Xcel Energy to charge it's customers about 25% more for wind power over regular power because wind power, a renewable, is still more expensive than generating it from other sources.

I found that with just a couple minutes of research. Why would someone claim that groups like the Independence Institute aren't even spending 5 minutes to back up their claims? To be blunt, because they don't understand the world they're talking about. Why else would someone make a claim, that there is no proof that renewable energy methods cost more than traditional means, which anyone with a couple minutes and access to Google can easily see to be false?

Denver's RTD likes to tell us that their cost over runs with FasTracks are as simple as an "unforeseen" rise in construction costs. Those are a large part of the issue for them. In itself isn't an excuse since their are financial instruments they could use to help mitigate those risks much like Southwest Airlines does with buying heating oil options to mitigate their jet fuel cost changes.

RTD's problems go beyond that. As previously mentioned on far too many parts of the Fastracks project they have been and still are overly optimistic about future costs for those items. That's not surprising since the lower the projected cost of the project when they went to the voters in 2004, the more likely they can get it to pass.

Another example of the lack of good project management by RTD came out last week. It seems that in RTD's ambition to get Union Pacific to move a major operation yard out to Fort Lupton, RTD purchased land for them out there. They weren't close to finalizing a deal but that didn't stop RTD from buying land at 3 to 8 times the going market rate.

Fort Lupton is more or less like the rest of Colorado east of the Front Range. It's relatively flat, empty high plains. Current market prices for agricultural land is $10,000 to $15,000 an acre. That's for agricultural land. UP recently bought 39 acres for $80,000 (a bit more than $2k per acre). Yet RTD lept in and bought land for $28k to $83k an acre! The result is that RTD's spent $15 million for land that it has no need for, especially with UP needing nearly three quarters a billion dollars to make the move.

RTD's costs for Fastracks have been driven up by construction related inflation. RTD failed to mitigate those risks. But their problems with managing this project go beyond their inability to plan for the future. They're simply struggling to make good decisions in running the project in cases like this. They're putting the cart before the horse. It should be no surprise that the project's costs have already gone up to $6.1 billion from $4.7 billion before they've even laid the first rail. Those costs are likely to be driven even higher as the state's review showed last week. At what point do the taxpayers say enough is enough and get RTD to change the scope of the project to prevent even more billions spent on what is essentially a downtown transportation system?

Fastracks Pricing "Optimistic"

At what point to the voters put an end to the project? It looks like it'll soon by 50% over budget and before it lays it's first rail.

Denver Post :
"Overall, the capital construction estimate of $6.1 billion is probably at the optimistic," or low side, DRCOG said, adding that "upward cost adjustments are likely" and "future increases to the cost of the FasTracks system should not be surprising."

An Old ONe

"But with a 30 percent drop-out rate, low college attendance rates, some of the most restrictive Medicaid eligibility, and a massive backlog in transportation projects, that simply is not the case."

But when has spending $$$ translated directly into fixing these issues? How much of the issue of drop-outs and college attendance is due to that it's likely 18-25% of the state's population are foreign born? Nothing against that but we know those demographics, especially the ones from Mexico and Central America tend to have little education and that has an affect on their children.

As for the transportation backlog, we could solve that with more private-public partnerships. No need to assume that the taxpayers should be coughing up the cash up front

A Wrong Doesn't Make A Right

Those opposing the Front Range Toll Road (aka Praire Falcon Parkway Express) have been pushing Colorado House Bill HB08-1343. One of the glaring problems with the bill is it severely restricts citizens ability to start a new railroad. Unfortunately, those opposed to the toll road give in to NIMBYism and support such irrational restrictions. I can't blame them for their opposition to eminent domain. Nevertheless, trying to keep their freedom by taking freedom away from others is not the solution. We simply continue down the path where people use government to get their own self-serving pet projects done. In response those restrictions I wrote the below letter to my Colorado representatives.

I am writing to you in regards to House Bill HB08-1343. I am not a fan of the use of eminent domain. I have empathy for those land owners faced with the Front Range Toll Road (also known as the Prairie Falcon Parkway Express). Nevertheless HB08-1343 will create problems. The main one is in concern to starting a railroad. It is not acceptable that the bill doesn't make it impossible to start a new railroad. The fact is it does make it much more difficult. Can you imagine a bill that had the affect of forcing all new restraunts to partner with an existing one? HB08-1343 will result in that sort of situation for railroads.

What will happen to new tourist railroads? What will happen if someone wants to start a new railroad to serve a line that UP or BNSF are looking to abandon? I'm sure as a legislator you are familiar with the bills that result in unintended consequences. At this point HB08-1343 looks as though it will be one of those bills. Please oppose this bill until it doesn't place such onus' on the railroads in an attempt to help those not in favor of the Front Range Toll Road.

Colorado Health Care

I'm glad to see others out there weighing in on the health care debate. To me the fundamental flaw of it lies at the core premise that so many people automatically assume, that the problem is a lack of health insurance. Health insurance in and of itself doesn't guarantee good health care. Doctors can choose to not to be a part of the plan. We can see that already with Massachusetts where people buying into the state plans have trouble finding providers (...and the state faced with ballooning costs is already looking to cut back). What good does that insurance do if you can't use it?

http://facethestate.com/articles/promises-made-promises-kept-fifteen-months-later

According to Brian Schwartz, a healthcare policy expert who testified before the 208 Commission, Ritter’s plan to increase enrollment in state sponsored insurance programs is only going to grow government unnecessarily and hurt Coloradans in the long run. “The children’s health plan is like the kiddie version of Medicaid,” said Schwartz. “Instead of passing more laws that unfairly compete with private companies and put people on crappy plans, why doesn’t the government look at what it is already doing make insurance so expensive?”

Transit Needs Cars

Funny how a transportation project that is supposed to relieve congestion and reduce pollution is completely dependent on the very cars that are causing so many issues. Why again are we planning on constructing a system that plans on people inefficiently transferring from one mode to the other? Why can't we just get them where they're going efficiently and directly..... in their cars that they're already driving anyway?

http://www.denverpost.com/headlines/ci_8201825

"A large part of ridership is dependent on parking; if we do not build parking, there is no system," Marsella said.

Colorado Monorail Is Dead

It's been over 4 years since they've updated their web site. Can we now say that the idea of building a monorail along I-70 is dead?