Cost Overruns in U.S. Rail Transit Projects: A Statistical Analysis

Cost overruns in U.S. rail transit projects have been reported in several studies. However, there is a lack of research conducting systematic and statistical analysis on the cost overrun trend of these projects in the past four decades. Besides, the cost estimation performance of recently completed projects is not evaluated. This study fills the gap by collecting data of 83 U.S. rail transit projects, the largest sample of its kind. Overruns against cost estimates at two milestones were investigated: (1) cost estimates at the alternative analysis (AA) phase (decision-making phase) and (2) cost estimates at the full funding grant agreement (FFGA). It was found that the average cost overruns against AA and FFGA estimates are 32.4% and 7.3%, respectively. The accuracy of cost estimates at the decision-making phase has improved significantly over time, however, the change in FFGA cost overruns is not significant. This paper also studied if the accuracy of cost estimates varies across different project modes, light rail, heavy rail, commuter rail, and automated guideway transit. It was found that light rail projects have more accurate FFGA cost estimates. This research provides a general picture of the occurrence of cost overruns in U.S. rail transit projects and provides reasons for optimism regarding the accuracy of cost estimates in future transportation projects.