How to fix transit construction in America

Introducing the Transit Abundance Playbook

Passengers wait as a train arrives. (Photo by John Moore via Getty Images)

Back last summer Slow Boring partnered with the Institute for Progress to help solicit ideas for what we’re now calling the Transit Abundance Playbook, a list of ideas to help address the cost bloat that has afflicted American transit construction.

Veteran Slow Boring readers will know that this is a longtime obsession of mine. I’m a native New Yorker who rode the subway every day in high school. When I moved to the totally unfamiliar city of Washington after college, I blindly ended up in Columbia Heights because I was looking for a cheap place near a Metro station. I used to think that American cities were under-provided with transit because the country was too unwilling to spend money. But I’ve learned that the United States actually spends a lot on transit construction — it just doesn’t build a lot of transit per dollar spent.

Improving the cost-effectiveness of projects would get more projects built without any more spending, and that in turn would strengthen the political case for spending. But while it’s easy to identify specific examples of bloated costs, what’s harder is to develop concrete policy ideas that change the way the whole system works.

Now, though, I think there’s a menu of ideas that could really fix the problem.

— Matt

Stop Paying More for Less Transit

By Will Poff-Webster and Arnab Datta

The United States once led the world in transit construction. In the 19th century, publicly subsidized railroads catalyzed steel production, agriculture, and even financial markets. In the early 20th century, America built the largest network of streetcar tracks in the world, igniting the first suburban boom and making homeownership and jobs available to millions. Subway systems enabled industrial growth and the development of knowledge-economy hubs that fueled American prosperity. Transit’s ability to move large numbers efficiently remains unmatched: Every day, the New York City subway serves more passengers than all American airports combined. Even in car-friendly Houston, more than half of suburban commuters to downtown take the bus.

But America has lost its edge. Today, we lead the world in transit construction costs, and build less as a result. America’s first subway line opened in 1897: a 1.5-mile tunnel in Boston built in just four years at a cost of roughly $5 million (about $200 million today). Had we kept costs steady since, we would be nearly on par with other developed countries. Instead, in 2022, New York City’s East Side Access project finally opened after 24 years of construction and $11.2 billion in expenditures — giving it the dubious distinction of being, per mile, the most expensive transit project ever built.

At least that project opened. Californians may never see the San Francisco-Los Angeles high-speed rail line they approved in 2008 and have already spent $15 billion on; the project’s expected cost has ballooned from $33 billion to more than $126 billion, with no plan to close the funding gap. Over the same period that California was failing to build a route from Bakersfield to Merced — just 150 miles apart — China connected every one of its major cities with 30,000 miles of high-speed rail.

We spend billions on transit projects but deliver far less per dollar than our global peers. The invisible costs are even higher: dysfunctional processes kill light rail routes that would unlock suburban growth, subway extensions that would connect working-class neighborhoods to job centers, and bus rapid transit corridors that would slash commute times for tens of thousands. Headlines about spiraling costs and decades-long timelines foster the belief that America cannot do big things anymore, a belief reaffirmed every time a major construction project becomes a cautionary tale.

Sky-high costs are an unfortunate case of American exceptionalism, but not an inevitability. The wealthiest country in the world should not fail where Southern Europe succeeds. We know what drives high US transit construction costs: overdesign and excessive customization, poor planning and procurement, too many veto points, burdensome permitting, and anemic state capacity. These problems compound, leaving only one option: pay more for less.

Just as there is no single cause for America’s high transit costs, there is no single solution. This playbook brings together leading transit practitioners, researchers, and advocates to translate research into policy solutions — each addressing a core driver of high US transit costs.

There is renewed attention to the red tape plaguing America’s ability to build. Consensus is growing that we need to remove barriers that constrict growth and stifle government delivery, but implementation is too often underexamined. Federal funding plays a central role in major transit projects. Accordingly, congressional and executive branch actions are powerful levers to address the high costs of transit nationwide. While federal policy is at the core of this playbook, solutions also target states, local governments, and private actors.

Cost-effectiveness need not be polarizing. Transit advocates should champion spending less, because every wasted dollar is another project never built. Fiscal conservatives have much to gain from faster delivery, because every delay begets more spending. Environmentalists can celebrate the construction of megaprojects that reduce pollution. Cities thrive when the public sector can build, and rural counties deserve buses that aren’t twice as expensive as in peer countries. And more transit ridership means less traffic for drivers.

Feats of infrastructure and governance once showed us what was possible, but our policy choices have throttled our ambitions. While American workers, scientists, and technologists race ahead to the next challenge, they ride to work on infrastructure largely built by past generations.

The proposals in this playbook offer concrete solutions to build the transit the public deserves, at costs the public can afford, on timelines that allow people to actually benefit. Let’s close the gap between where we are and where we need to be.

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All of the pieces in the Transit Abundance Playbook are available at ifp.org/cheaper-transit, and at the following links:

Planning

• Reform Funding to Encourage Early Transit Planning, Eric Goldwyn - The federal grant review process incentivizes agencies to rush to secure funding rather than methodically plan projects. A phased “Transit ID” program (mirroring the Federal Railroad Administration’s “Corridor ID”) with smaller, milestone-based grants would reduce risk and lead to better projects.

• Focus Capital Investment Grants on Improved Project Delivery, Stephanie Pollack - Federal grants that fund most major American transit projects are governed by rigid, bloated rules that impede timely and cost-effective project delivery. Reforms could cut procedural requirements, fund early right-of-way and early works investments, require accelerated state and local permitting, and loosen procurement rules to favor the highest-value bids.

Cost-effective design

• Reduce Needless Bus Customization, Rohan Aras and Alex Armlovich - Buses cost twice as much in the US as in peer countries, in part due to excessive customization by transit agencies. Capping federal cost-sharing at a benchmark price and encouraging standardization and joint procurement could bring costs down while unlocking manufacturing economies of scale.

• Eliminate Redundant Subway Cross-Passages, Brian Potter - US subways follow a safety standard from the National Fire Protection Association that mandates twice as many cross-passageway tunnels as in Europe, with no demonstrated safety benefits. Adopting the European standard in the US could save millions in construction costs.

Procurement

• Get the Best Value in Transit Procurement, Anthony Potts - State and local procurement rules often require awarding contracts to the lowest bidder, even though this leads to worse, costlier outcomes over the long term. Federal transit grants should encourage best-value selection, in which agencies evaluate contractor competence and price holistically.

• We Should Know How Much Transit Components Cost, Alon Levy - Lump-sum, NDA-protected construction contracts hide true project costs, resulting in lawsuits for changes during construction and 20–50% bid inflation by contractors. Requiring itemized bidding based on a database of component prices (as practiced in Italy and Spain) would increase transparency and reduce costs.

Utility, agency, and local government coordination

• Transit Projects Need a Single Decision-Maker, Anonymous - To build a transit project, transit agencies must negotiate dozens of separate agreements with utilities, local governments, and other third parties. Each is an opportunity to extract concessions paid for with transit dollars. Adopting Italy’s Conference of Services model would allow a single appointee to decide on project tradeoffs and ensure disputes are resolved up front, rather than at the last minute when transit agencies have the least leverage.

• Use AI to Improve Transit Planning, Lizzie Speed and Bennett Capozzi - Transit project knowledge is scattered across past reports and data sources, increasing the need for consultants and preventing the development of in-house expertise. A centralized repository for federal transit reports and project data, along with an AI-based system for querying it, would allow transit agency staff to mine past projects for usable lessons. This would mirror similar innovations at other federal agencies like the FDA.

Permitting

• Let Agencies Do Their Own Environmental Review, Jamey Tesler - The Federal Highway Administration delegates part of its environmental review process to states, reducing review times by up to 85%. Adopting the same framework at the Federal Transit Administration (FTA) could similarly accelerate reviews for transit projects.

• Fast-Track Democratically Approved Transit Projects, Hayden Clarkin - Requiring environmental review for voter-approved transit projects generates costly and redundant documentation (100,000+ pages and more than $1 billion in costs for California high-speed rail) and delays environmentally beneficial transit projects. Exempting voter-approved projects would accelerate their delivery, ensuring constituents don’t wait decades to get what they asked for.

• Let Transit Agencies Buy Land, Aidan Mackenzie - FTA’s expansive reading of environmental law bars agencies from project steps such as buying land until after project permitting is complete. These activities are often best done early, but the ban incentivizes agencies to compromise project design in order to avoid them. Allowing early works would reduce costs and enable better project delivery.

State capacity

• Put Transit Staff in Charge of Their Own Projects, Paul Lewis - Agencies have outsourced design, project management, and risk to consultants, incentivizing scope creep, inflating labor costs, and eroding in-house expertise. Federal grants and oversight should incentivize more capacity within transit agencies.

• Close America’s Transit Automation Gap, Andrew Miller - A provision in the Urban Mass Transportation Act of 1964 mandates an open-ended review whenever federal funding would affect jobs, effectively blocking the automation of legacy subway systems. Amending the statute to explicitly guarantee worker protections, rather than requiring a veto-prone process, would enable agencies to pursue automation and unlock substantial operational savings.

• Share the Truth About Transit Project Failures, Philip Plotch - Fear of reputational damage and litigation suppresses honest post-mortems on transit projects, leading to new projects repeating the same mistakes. Providing confidential ways for agencies to share lessons learned, protected against FOIA, would enable candid knowledge sharing.

• Loans Can Stabilize Transit Funding, Jackson Moore-Otto - Transit agencies depend on unpredictable discretionary grants to fund new transit construction, an arrangement that leads to poorly planned, grant-chasing spending. Streamlining access to federal loans would create an alternative funding model for projects that promise a strong return on investment and encourage both cost discipline and the development of internal agency capacity.

Special thanks to all playbook authors, and to Eric Goldwyn, Jarrett Stoltzfus, and Stephanie Pollack for their contributions advising the project. The Transit Abundance Playbook was created with the help of Rita Sokolova, Reed Schwartz, Abigail “Beez” Africa, Aidan Mackenzie, and Ben Schifman.