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Southwest rail funder pushes for cost savings

Even though the latest price tag for the Southwest light rail project has jumped to $2 billion, the largest local funding entity doesn’t want to pony up more money.

The Counties Transit Improvement Board, which collects a sales tax in five metro counties to pay for transit expansion, previously committed to covering about 30 percent of the Southwest Light Rail Transit project. The funder’s $496 million commitment came when the estimated cost was $1.65 billion.

With new environmental analysis driving the costs up, CTIB board members made it clear at a meeting Wednesday that the $496 million contribution is not expected to rise.

“That’s a whole different message we don’t want to send. We don’t want to start down that slippery slope,” Anoka County Commissioner Matt Look said.

Instead, the board is hoping project partners can identify $341 million in cost reductions along the 16-mile line to move the project forward at the previously approved budget. The route will run between Minneapolis and Eden Prairie, with stops in St. Louis Park, Hopkins and Minnetonka.

“Those cost savings are going to have to come in $40 million here, $40 million here,” said Ramsey County Commissioner Jim McDonough. “If this region is going to advance this project, we need to look at $341 million and we need to have that goal in mind.”

The Metropolitan Council’s Southwest Project Office, which oversees delivery of the project, is now seeking and evaluating changes that could save money. The project office plans to have a list of possible changes later this month. The only cost-saving measure discussed by the CTIB on Wednesday was reducing the length of the line in Eden Prairie.

That option also was raised Tuesday at a meeting with mayors and representatives from all five cities along the line. Hennepin County Commissioner Peter McLaughlin, who chairs the CTIB, said a representative from Eden Prairie was open to the idea of reducing the number of stations within the city.

Five stations are planned in Eden Prairie, including the line’s terminus at Mitchell Road. Options are available that would allow the line to still reach Eden Prairie without going all the way to Mitchell Road, McLaughlin said.

CTIB members have previously spoken out against the Mitchell Road station. The last mile to the Mitchell Station is estimated to cost $110 million to $120 million, according to the Southwest Project Office.

Met Council Chair Adam Duininck said it was also important to spread out the cuts throughout the line so that cities aren’t disproportionately affected.

Beyond cost reductions, changes to the project will be evaluated so that they do not have a negative impact on the project’s rating with the Federal Transit Administration, said Mark Fuhrmann, who oversees rail projects for the Met Council. Other factors to consider include impacts to ridership and the project schedule and whether the change would require additional environmental study or re-trigger the municipal consent process.

McLaughlin said interim FTA administrator Therese McMillan was “very positive” about the project in a recent phone call. The FTA is expected to contribute 50 percent of the project’s cost.

While the new estimate for Southwest might have shocked project backers in Minnesota, three other light rail projects in the federal pipeline have exceeded the $2 billion mark, according to the Met Council. Those projects are in San Diego, Baltimore and Washington, D.C.

Beyond evaluating potential reductions to the project, the Southwest project office is also reviewing other transit options in the corridor including enhanced bus and bus rapid transit and comparing them to the light rail plan. Peer-review engineering consultants are also reviewing the current cost estimate.

An independent review will also evaluate the project office, its management structure and processes to determine whether it is capable of managing the project. That review is expected to be available in late June.

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