Houston's Light Rail Discrepancy?

Leave it to the anti-rail nuts to find the details. But I do find this interesting. If there was a letter to the FTA that showed doubled cost, what was it for?

On March 4, the Metro Board voted on a contract with the Parsons Group to design, build and operate four new Light Rail lines. The cost for the North Line would be $387 million, and the cost for the Southeast Line would be $441 million.
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According to letters dated on March 23 from Metro to the Federal Transit Administration, Metro indicated that the current net project cost estimate would be $896 million for the North Line and $911 million for the Southeast Line.

Now it would be interesting to know why lines would cost ~$170 million per mile for surface light rail. Honestly, that is ridiculous. Obviously the nutcases that have always been against light rail are going to have a field day, but I have one guess as to why it will cost so much. The deal that Metro cut with the City of Houston to build the lines includes complete reconstruction of the street from curb to curb. So not only would this be the construction of the rail lines, but construction of the street, sewer systems and sidewalks that border the line.

METRO is also giving something to the city: $300 million of utility upgrades. For example, if a sewer line needs to be larger or needs to be replaced due to age, METRO will install a new one.

In fact the recent North Corridor planning document had this to say:

The typical life of a water transmission main is 40-50 years. For the North Corridor, research indicates that the lines, including the Churchill Street Line and extending all the way to the intersection of Crosstimbers Street/ Fulton Street, have reached the end of their life span.

The life of a sewer line is typically 30 to 40 years, unless the lines are rehabilitated. From the City’s GIMS database, it appears that there are several sewer lines that are older than 40 years. It is not clear if these lines have been rehabilitated. These include distinct segments along most
of the length of the Corridor. The construction dates for some segments are unknown.

Current City regulations require storm water detention for all new development. Hence, any new developments that are proposed will be required to design for storm water detention.
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The Transit Street itself is characterized with a combination of industrial, residential and commercial uses, which would normally have the capacities needed for redevelopment.

However,the condition of water mains and sewer lines appears to be quite old along this Corridor and replacement of these services should be contemplated as transit is being constructed.

I'm not completely for sure that this is the deal but it's my best guess as to why the lines could possibly cost so much. The need to replace that infrastructure would be there anyways, but why not try and get the FTA to foot some of the bill if possible? That is what comes to the minds of a lot of transit agencies who are trying to build new lines, if we can get more money, why not try.

I personally think that its a really messed up accounting exercise that allows light rail and even BRT projects around the country to get attacked for thier high price tags because of necessary replacements credited to thier accounts. I want more information before I go off the handle on insane light rail costs, but if it's that much for just the light rail, Houston got bad engineering estimates and needs to start over again. That much per mile should not be tolerated for surface light rail. Even if the utilities are included, I'm inclined to say the prices are too high. I have a feeling though, that we're missing something...