Massive CTA costs overruns at Block 37 spur privatization talks, Crain's reports
Due to cost overruns of up to $150 million on construction of the giant CTA station under Block 37, the city and the CTA reportedly are talking about privatizing that part of the project, according to Crain's Business scoop late Friday.
From the report:
"Sources close to the matter say the city has begun discussions with Macquarie — the Australian investment bank that two years ago paid the city $1.82 billion to lease the Chicago Skyway — about buying or leasing the Chicago Transit Authority station underneath the high-profile retail and office complex now being built.
"Insiders say it’s clear that completing the station, which would connect the Red Line and Blue Line subway tunnels and potentially anchor airport-express train service, will cost $100 million to $150 million more than the $213.3 million originally budgeted."
Another huge Chicago project, another story about cost overruns. Can you say Millennium Park? I say do it -- privatize the station and give the city and CTA some much needed cash.
In other CTA news. . .
CTA, Pace cut fees for Chicago Card, ADA pass: The CTA has waived its $5 fee for Chicago Card and Chicago Card Plus, and Pace has cut in half its fee on the monthly ADA pass for paratransit users, the Tribune says. If the state fails to act and fares go up on Sept. 16, Chicago Card users will pay just 25 cents more, while non-pass users would pay (pdf) 50 cents to $1 more.
Illinois House to vote today on sales tax hike for CTA, RTA, Metra, Pace: Senate Majority Leader Michael Madigan has promised a vote today on Senate Bill 572, the one-quarter-of-one-percentage point hike in the sales tax and Chicago real estate transfer tax. Let's hope it passes with a veto-proof majority, because otherwise, the vote is purely symbolic since Gov. Blagojevich has promised to veto it. UPDATE: Also, the Tribune today has a good analysis of where the money comes from and where it goes.
So on the verge of a major funding vote, more news the CTA--and, by extension, the city--can't be trusted with money?
I take the CTA everyday and fully support the bill up for a vote, and other measures for help out the RTA agencies. But let's be honest--part of the reason we are in this mess, and part of the reason some lawmakers decline to support mass transit, is because of the crooks and bumblers who run the CTA. I doubt there is any more worthless group of hacks outside of New Orleans.
Part of me hopes the CTA just collapses, and the city along with it. Citizens have been electing these boobs for too long, and citizens deserve the ill effects of decline.
Posted by: Thad | September 04, 2007 at 08:43 AM
The Block 37 subway project was undoubtedly budgeted several years ago and materials costs have indeed gone up quite sharply. The article also mentions that they had problems locating all the rather old utility lines which are still in use. It wouldn't exactly due for the contractor to cut a major water main or electrical line in the very center of the loop.
Infrastructure projects like this also NEVER come in at or under budget. The city needs that station for express service to ORD for the Olympics.
Posted by: g | September 04, 2007 at 09:09 AM
Why on earth would the IOC give the nod to a city that can't manage a decent transit system?
Posted by: Cheryl | September 04, 2007 at 09:31 AM
Land bank the "Block 37" basement. Then revisit creating the ultra station in five or ten years when the State's and City's finances are less of a mess.
The B-37 building is already up -– I'm looking at it right now from my office in the Chase/Bank One/First of Chicago Building. So whatever work is intended to create the basement ultra station, the civil engineers must already have a plan for doing it under a completed, occupied building. No?
Don't understand why finishing (or starting?) the station cannot wait.
Maybe privatizing the project makes sense. But doing it in a panic, simply to escape self imposed financing problems ensures that the City will get only a fire sale price.
Posted by: Ivory-billed Woodpecker | September 04, 2007 at 10:18 AM
"A consultant’s report prepared for the CTA last year said the express-train service would cost $1.5 billion or more to build."
Block 37 will give no value to community. It will not create an express train to ohare-midway. It's a train station to nowwhere, it's Chicago version of the big dig.
Posted by: bill bucks | September 04, 2007 at 10:19 AM
I'm still baffled by this fantasy of express service to O'Hare. Just how do these magical chariots zoom past all the regular Blue Line trains cluttering the Blue Line tracks?
Posted by: Bob S. | September 04, 2007 at 11:41 AM
Cheryl's got it right. There's no rush for this expensive boutique project when you can barely get to the airport on the Blue Line, or get downtown on any L line. So why are they talking about cutting bus lines and services and raising fares while spending money on this?
Privatization is a panic short-term solution that robs public space for private gain in the long run. This station can wait, maybe forever. It should be the CTA's very lowest priority. Those millions could go a long way toward making the Blue line and the rest of the system fast and reliable.
What I want to know is, why would all these rich dudes they're apparently expecting go downtown to take an expensive L to the airport? If money's no object, why would they decide to quit taking limos? The whole thing makes no sense and stinks of something a third-world dictator would do to make his country look "advanced". Has Chicago really sunk that far?
Posted by: Davey | September 04, 2007 at 12:04 PM
I'm with Bob S. I've never once understood how the heck they expect to run a train express to O'Hare, unless by "express" they just mean "doesn't open its doors anywhere between Block 37 and ORD" -- which, really, who's going to pay a couple bucks extra for that? Tourists who are bad at reading maps and timetables? (Oh, timetables... I crack myself up.) Or maybe they intend to switch it back and forth between the two tracks, over and over again, zipping around stopped trains? (Hope they're only running one express at a time, then... and I hope nobody onboard gets motion sickness, either.)
Posted by: sabrina | September 04, 2007 at 12:30 PM
Also, while I'm certainly not claiming it didn't have massive cost overruns, the Big Dig isn't a good analogy here. It actually succeeded at speeding up traffic through Boston and opening up the city to both new development and increased parkland. Block 37's a much smaller project with no hope of success even on its more modest level.
I echo Davey's comments about privatization, too. It never, ever works. The profit motive cannot and should not sustain civic infrastructure. Why exactly was the CTA created from the broken shards of the for-profit companies that used to run its many chaotic parts?
Posted by: Bob S. | September 04, 2007 at 01:09 PM
Davey: yes, Chicago has sunk that far, and our "dictator" is Mayor Daley.
Posted by: sparky | September 04, 2007 at 01:46 PM
I just read this on the Capital Fax Blog:
"The House just voted on the CTA/RTA bailout bill. It failed to reach the three-fifths level and was placed on the order of Postponed Consideration."
I guess that means its pretty much a sure thing we will be seeing the September 16th cuts. I just hope they can get their act together to avoid the huge cuts coming in 2008.
Posted by: Ed | September 04, 2007 at 04:17 PM
There were a few options for the express service.
1) Use existing Blue Line Trackage for service. This is obviously the easiest/least expensive option though actual value seems limited since the trains will inevitably get stuck behind local Blue Line traffic at some point.
2) Construct new trackage on Blue and Orange Lines to circumvent the local service. A combination of elevated and side passing for the Blue Line would have to be used. This is the middle expense option.
3) Purchase land in the Union Pacific right of way to construct an entirely new set of lines to bypass local Blue Line service. Connect new trackage with the Blue Line via subway near Elston/Milwaukee and at Cumberland near O'Hare. This is the $1.5B option.
Posted by: g | September 04, 2007 at 04:50 PM
How in name of Wide World of Sports can the City
of Chicago's mayor, aldermen, civic leaders,
and the CTA come up with $ 213 million to
build a subway station at Block 37 while begging
the Illinois General Assembly for money to
keep the rest of the system solvent ?
Sounds like someone (Daley/Kruesi) had their
priorities convoluted.
Posted by: marionmims | September 04, 2007 at 10:18 PM
This privatization talk is an outrage. I hope it never happens, and they should stop construction now.
Posted by: Marc | September 05, 2007 at 09:39 AM
> How ... can the City
of Chicago's mayor, aldermen, civic leaders,
and the CTA come up with $ 213 million to
build a subway station at Block 37
For the record, here's the vote on the City-CTA intergovernmental agreement on the SuperStation, including funnelling $42,350,000 from the Central Loop TIF:
Chicago City Council, May 11, 2005
AUTHORIZATION FOR EXECUTION OF INTERGOVERNMENTAL AGREEMENT WITH CHICAGO TRANSIT AUTHORITY CONCERNING TRANSFER OF TAX INCREMENT FINANCING FUNDS FOR CONSTRUCTION OF AIRPORT CHECK-IN FACILITY, STATION FACILITY AND OFF-BLOCK IMPROVEMENTS AT 108 NORTH STATE STREET (BLOCK 37)
Yeas -- Aldermen Flores, Haithcock, Tillman, Hairston, Lyle, Beavers, Stroger, Beale, Pope, Balcer, Cardenas, Olivo, Burke, T. Thomas, Coleman, L. Thomas, Murphy, Rugai, Troutman, Brookins, Munoz, Zalewski, Chandler, Solis, Ocasio, E. Smith, Carothers, Reboyras, Suarez, Matlak, Mell, Austin, Colon, Mitts, Allen, Laurino, O'Connor, Doherty, Natarus, Daley, Tunney, Levar, Shiller, Schulter, M. Smith, Moore, Stone -- 47.
Nays -- Alderman Preckwinkle -- 1.
Posted by: Hugh | September 06, 2007 at 06:29 PM
Senate Majority Leader Michael Madigan?
Posted by: Hugh | September 06, 2007 at 06:32 PM