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8 Estimating Soft Costs for Major Public Transportation Fixed Guideway Projects
S.3. Soft Cost Expenditures: As-Built Analysis
This report analyzes a database assembled by the Federal Transit Administration of
as-built costs for 59 rail transit construction projects in the United States over the past four
decades (summarized in Figure 3) and concludes that:
· The current industry practice of using percentage add-ons for soft costs appears to be a
valid approach to estimating soft costs. Project characteristics such as complexity, mag-
nitude, mode, context, and others identified by industry estimators are correlated with
soft costs in dollar and percentage terms.
· Soft cost expenditures have averaged around 30% of construction costs, with a range
across all projects of between 11% and 54%, depending on the characteristics of the proj-
ect, as Figure 3 indicates (outliers excluded).
· Cost estimators typically begin estimating soft costs with average percentages that corre-
spond closely to historical averages for each soft cost component, as Table 3 shows.
· However, actual soft costs in past projects have shown a wider range of variability than
estimators currently use. While estimators report choosing from within a range of around
20 percentage points, past projects have varied within a range of around 40 percentage
points (outliers excluded).
· Some variability in soft costs cannot be explained solely with information available to the
estimator prior to construction. The statistical analysis applied in this research was able
to explain around 60% of the changing relationship between hard and soft costs with data
available during planning phases. This suggests that the remaining variability in soft costs
must be estimated with a blend of science, judgment, and art.
S.4. A New Approach to Estimate Soft Costs
This report is accompanied by a guidebook that presents a new method to estimate soft
costs for a planned transit project that is firmly rooted in historical experience. The Guide-
book also serves as a primer on soft costs and takes the reader through a step-by-step process
to estimate the relationship between a given transit project's hard costs and its likely soft
costs, given certain characteristics about the project and its sponsor.
Soft Costs (% of Construction)
60%
50%
40%
30%
20%
10%
0%
Hud-Berg II
Hiawatha
Sacram. I
Hud-Berg I
Portland So
Sacram. Fol
Portland Int
Charlotte
LA Gold East
LA Gold Pasa
Sacram. So
Portland W
South NJ
Pittsburgh N
Portland Seg1
Pittsburgh I
LA Blue
VTA Tas E
Pittsburgh II
Denver SW
VTA Capitol
Phoenix
CTA O'Hare
DC U St.
DC Anacost
DC Addison
DC L'Enfant
DC New Ca
DC Shady G
DC Huntgtn
DC Glenmt 1
CTA Douglas
NYCT 63rd
CTA Orange
Baltimore
DC Vienna
MBTA Orang
CTA Brown
MARTA N-S
Miami
San Juan
DC Anacost O
DC Springfld
DC Glenmt 2
DC Greenblt
BART SFO
Phil Frankf.
NYCT Stillw
Salt Lake
St. Louis
San Diego
Light Rail Heavy Rail
Figure 3. Historical soft costs by project and mode (outliers excluded).
