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CHAPTER 4 As-Built Soft Cost Analysis This report has thus far summarized efforts to assess the practice of soft cost estimation, as revealed through interviews and a questionnaire of cost estimators. To complement this research, this section examines actual soft cost expenditures from past construction projects. This as-built analysis also assesses the relationship between characteristics of transit infrastructure projects and actual soft cost expenditures for as-built projects. 4.1. Approach This analysis has three major objectives: Describe the magnitude and range of soft cost expenditures in previous projects; Analyze the relationship between these soft costs and other project characteristics as cost drivers, such as project complexity, mode, year, size, delivery method, and economic conditions; and Form the ultimate basis of a new historically based methodology to estimate soft costs for future rail transit construction. 4.2. Data Source: FTA Capital Cost Database To examine historical costs, this analysis used as-built cost data and characteristics on 59 urban rail transit projects constructed over the past four decades in the United States. This cost data has been adapted from the capital cost databases developed for the FTA. In addition to this dataset, this study also relied on project schedule data adapted from the final report of TCRP Project G-07, Managing Capital Costs of Major Federally Funded Public Transportation Projects (Booz Allen Hamilton Inc., 2005), and developed some additional data on project char- acteristics such as public involvement, installation conditions, and sponsor agency capitalization policies. 4.2.1. About the Projects Included The projects included in this database were constructed by transit agencies in major urban centers and distributed throughout the various geographic regions across the United States. Over the period of 1984 through 2008, 29 light rail projects were constructed, and 30 heavy rail projects date from 1974 through 2005. This project cost database includes the costs of 59 proj- ects of various sizes, ranging from $100 million to over $2 billion, and represents new rail line segments, extensions of existing networks, and several rehabilitation and replacement proj- ects. This wide range of rail projects provides a good distribution of projects to examine the soft cost requirements needed in their development and offers a reasonable representation of 31

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32 Estimating Soft Costs for Major Public Transportation Fixed Guideway Projects the requirements for professional services and soft costs for passenger rail construction in the United States. 4.2.2. About the Cost Data Format All project expenditures are reported in standardized formats for individual light and heavy rail project segments. The light rail database reports as-built costs in the same format as the Fed- eral Transit Administration's current SCCs, while the heavy rail data is reported using a prior SCC format. Both formats use common element definitions and consistent structures to docu- ment the as-built costs of these passenger rail projects. Costs were adjusted to an average of the 38 largest U.S. metropolitan areas and then escalated to a common base year of 2008 using Means Construction Cost Index (Murphy, 2008) for this consistent dollar value. The cost categories for these two datasets are listed below in Table 12 using the present FTA SCC category format in order at left and the corresponding heavy rail categories at right. Most capital cost categories examined in this section are comparable between the two data structures, with minor exceptions. In addition, this analysis took several steps to prepare and standardize the cost data: 1. All dollar costs were inflated to constant 2008 dollars; 2. All dollar costs were adjusted for localnational cost variations using the Means Construction Cost Index (Murphy, 2008); and 3. Outlier data points were eliminated. The details of these adjustments can be found in Appendix C. 4.2.3. Project Development Schedule Database The project development schedules used in this analysis have been adapted from the results of the contractor's final report from TCRP Project G-07 entitled Managing Capital Costs of Major Federally Funded Public Transportation Projects (Booz Allen Hamilton Inc., 2005). The G-07 report examined the various strategies, tools, and techniques available to better manage major transit capital projects and developed another separate project development schedule database to examine project schedule delays and their impacts on project costs. The evaluation of soft costs relies on Project G-07's schedule database to measure the relationship between project schedule and soft costs incurred. 4.2.4. Drivers Tested Table 13 presents the non-financial data items that are tested here as potential cost drivers for actual soft cost expenditures. Some of these results are shown in Appendix C. Table 12. Light and heavy rail capital cost categories correspondence table. Light Rail Heavy Rail 10 Guideway and Track Elements 1.00 Guideway Elements 20 Stations, Stops, Terminals, Intermodal 4.00 Stations 30 Support Facilities: Yards, Shops, Admin. 2.00 Yards and Shops 40 Sitework and Special Conditions 6.00 Special Conditions 50 Systems (Signals, Power, Communications) 3.00 Systems 60 ROW, Land, Existing Improvements 7.00 Right-olf-Way 70 Vehicles 5.00 Vehicles 80 Professional Services (Soft Costs) 8.00 Soft Costs 90 Unallocated Contingency 100 Finance Charges