Minutes 09-04-2018 - Laserfiche WebLink

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12 In the interest of time, I won’t go into detail on reductions in bust services nor discuss the failure to serve Orange County’s downtown districts or growth centers. What we need at this point is to revisit the financial history of this project. Specifically: • Local costs have more than quadrupled from $400 million in 2012 to now over $1.8 billion • Changes in state and federal funding have required planners to assume nearly a billion dollars in debt to make the project economics work • The project will tie up our transit dollars for decades under even the rosiest of scenarios that GoTriangle presented to you early last year The $57 million shortfall that Durham has agreed to fill is only one of several new critical problems facing the project. Another is the substantial shortfall in revenues from dedicated transit taxes and fees. Our financial advisors (Davenport) warned us that this would likely happen. Now we can see just how unsupported the original budgets were. We ask that the current County Commissioners retain Davenport to re-analyze the financial data for DOLRT so that the next Commission will have the best possible information to inform the looming decisions regarding whether and how to proceed with this project. My colleague and friend, John Morris wants to expand on this topic. Charles Humble John Morris said Davenport provided very valuable information eighteen months ago. He said federal funding is at risk as the federal government as made a policy to fund no new light rail projects that have not already received a binding commitment, which this project has not. He said this project is the lowest ranked priority project in all the projects that applied for FTA funding at the same time, and is the most expensive of all the projects, making a favorable decision unlikely. He said constructions costs are rapidly, as are interest rates. He said an independent evaluation is needed regarding these new trends. He said it is possible that the land given by UNC and NCCU will be considered a state donation, and thus subtracted from the $190 million maximum state contribution. He said as planning proceeds, changes are needed, such as elevating the track near the Duke University Medical System, to the tune of $90 million. He said cost increases are inevitable in the planning process, and more should be suspected. He said the use of public transit is decreasing nationwide, and the result will be lower fare income to offset the operational costs. He said GoTriangle is unresponsive and the need for independent analysis is even more important. Commissioner McKee referred to the mention of the $90 million elevated track, and asked if this is a new expense. John Tallmadge, GoTriangle Regional Services Development Director, said the $90 million is part of the work that has been done to progress the design from 30% to 50%. He said it is part of the 50% design cost; the transition of some unknowns that were in contingency in April 2017; value engineering decisions to accommodate the changes within the budget, which remains at $2.476 billion. Commissioner McKee clarified that the $90 million, and any other additional expenses, have been off set by value engineering and or reductions in other areas. John Tallmadge said yes. Commissioner McKee asked if there are any surprises on the radar. He said there is a huge amount of infrastructure between Chapel Hill and Durham, and asked if this will lead to any surprised. John Tallmadge said the risk assessment, which Travis Myren described, includes FTA assessment of whether there is sufficient contingency left in the budget currently. He said this is a potential change that is hanging out there.