1Reduce the cost of building rail transit

While the following recommendations pertain specifically to building new rail transit, many are applicable to other types of infrastructure construction.

Achieving these reforms will be difficult, requiring strong political leadership, good-faith labor-management negotiations, and a willingness to re-examine long-standing procedures and practices that have outlived their original purpose. The most critical actions include the following:

• Make constructability a top priority of a rationalized environmental review system. The environmental review often results in project scopes or mitigation that greatly increase construction costs, such as when access to construction sites is limited to locations and times that extend the time it takes to complete the project. While these restrictions are based on legitimate concerns, the costs of mitigation on project timelines and benefits should be weighed against community and environmental impacts; and international best practices should influence reforms that make environmental review simpler and more transparent. Federal, state, and local environmental reviews should include an independent analysis to evaluate the potential costs and disruption to surrounding communities against the costs, both financial and environmental, of the most cost-effective construction plan. Costs to the project should be given equal weight to disruption and other non-project costs.
• Engage the public early in sustained, substantive discussion. Environmental review is not a public-engagement strategy, and is limited to public hearings on technical documents conducted well after projects have been largely selected and designed. To get broad acceptance of system improvements, the MTA must engage the public with greater frequency, clarity, and transparency. The MTA’s extensive outreach to stakeholders, as part of the planned 15-month L-train outage, is taking place years before the start of construction—an approach the agency should replicate. Another best practice adopted by the MTA is the early opening of local community outreach and education centers, like the Second Avenue Subway Community Information Center recently opened on 125th Street and Park Avenue. These effective new efforts must be supported and expanded.
• Adopt London’s project delivery model. Every megaproject should have a temporary organization with a focused mission of meeting project schedules. This Special Purpose Delivery Vehicle (SPDV) could be modeled on the London Underground’s complex Elizabeth Line project, which was delivered on time and on budget. The SPDV would enable construction professionals more authority and accountability to control budgets, such as by giving them the ability to require supplemental funding from any agency that proposes any costly changes.
• Maximize the land-use development potential of transportation investments. Future megaprojects should incorporate land-use and zoning changes to capture the value created through development opportunities, while working with local communities to protect residents from displacement (link to Comm-1). New York did this as part of the #7 Line extension, in which the city prepared a former industrial area to be redeveloped into a mixed-use commercial center. ESA and SAS, whose economic impacts are more diffuse, could have leveraged redevelopment opportunities at new or existing stations to help pay for the project while at the same time addressing the region’s housing and job needs.
• Mandate design-build for all new rail lines and extensions. The MTA should replace its traditional multistep procurement process, which is primarily useful for targeted improvements on existing infrastructure, with this increasingly accepted practice. Design-build allows greater creativity, which can lead to budget savings by mixing design and contractor teams, allowing for better and closer collaboration from the outset, and eliminating the need to reconcile designs later. Contractors are able to evaluate the constructability of designs as drawings are produced, offering suggestions on cost savings based on their experience in the field.
• Rethink labor practices and work rules. We should adopt the best practices other cities have demonstrated in maintaining employment and wages while delivering projects faster and at lower costs. Many project managers and contractors say work rules are a major factor driving inefficiency and higher costs. Reforming how work shifts are defined, along with overtime pay and staffing of tunnel-boring machines, could result in significant costs savings. And even wider savings could be achieved by examining the rules embedded in collective bargaining agreements.