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Friday, December 07, 2012
GAO: California high-speed rail cost estimates are accurate - for the most part
Cost estimates for California's high-speed rail project are mostly accurate, yet not entirely comprehensive, according to an initial evaluation conducted by the U.S. Government Accountability Office (GAO).
The California High-Speed Rail Authority's (CHSRA) cost estimates include major components of the project, as well as operating costs. However, those estimates are not based on certain assumptions, such as how the authority plans to adapt existing high-speed rail technology for their specific project, according to the report.
"The cost estimates are accurate in that they are based on the most recent project scope, include an inflation adjustment and contain few mathematical errors," the report's summary states. "And while the cost estimates' methodologies are generally documented, in some cases, GAO was unable to trace the final cost estimate back to its source documentation and could not verify how certain cost components, such as stations and trains, were calculated."
Although CHSRA has evaluated the credibility of its estimates by performing a sensitivity analysis, which assesses changes in key cost inputs, and an independent cost estimate, GAO found that those evaluations were not representative of the entire project.
"For example, the sensitivity analysis of the construction cost estimate was limited to 30 miles of the first construction segment," the report states. "The authority also did not conduct a risk and uncertainty analysis to determine the likelihood that the estimates would be met."
CHSRA officials are taking steps to improve their cost estimates, GAO officials added.
The project still faces many challenges; obtaining project funding beyond the first 130-mile construction segment is chief among them. Although CHSRA has secured $11.5 billion from federal and state sources, it still needs almost $57 million more, and future federal funding is uncertain, GAO officials point out.
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