Light-rail project jumps budget track
- January 29, 2009
At a time of severe budget shortfalls for state and local governments, higher costs for Norfolk’s light-rail project is not welcome news. Due to state-mandated improvements, costs have ballooned to $288 million, 24 percent more than the original price tag of $232 million.
Local observers have grumbled that the project has been “mismanaged” by Hampton Roads Transit (HRT), even as government officials began figuring out how they will make up the $55.9 million in additional costs.
The rail line will run 7.4 miles through downtown Norfolk and eventually could expand to Virginia Beach. Funding is being provided by federal, state and local sources. Construction began in March.
HRT officials blamed some of the cost overruns on unexpected increases in construction and commercial real estate prices. They also noted that much of the price difference is the result of improvements demanded by local and state entities. These include additional safety, communication and security features mandated by the state, such as automated signaling equipment and gates; station enhancements, including changes to the site elevation for one station at Norfolk State University; and a switch to center-line poles in the downtown region.
John A. Hornbeck Jr., president and CEO of the Hampton Roads Chamber of Commerce, believes that much of the fanfare about cost overruns is political. The project “was extremely popular when gas was $4 a gallon, but now that gas prices have suddenly dropped, there’s less urgency about it,” he says. “It makes it easier to be critical and a naysayer, but the truth is that sooner or later, the price of gas is going to go up and here in this area. We’ve got to create multimodal sources of transportation. We can’t just keep laying concrete. A light-rail system is one of the solutions that have got to continue to be developed.”
Officials in Norfolk, which now will pay $53.7 million of the total project cost, apparently agree. Within days of the report, they were considering options on how the city could come up with another $20.7 million, its share of the project’s price differential. Options include an increase in commercial real estate tax rates or shifting state and federal monies originally earmarked to pay for other transportation projects