The Purple Line received some good news the other day when the Federal Transit Administration (FTA) recommended both the Purple Line and Red Line for a full funding grant agreement. Both are included in President Obama’s budget with $100 million budgeted for the Purple Line.

The president’s proposal is a long way from a final budget–if Congress can even agree on a budget in this election year. But it is a step forward for the Purple Line, as federal funding is vital to the planned light-rail line. Proponents of the project are understandably pleased with this announcement.

The next day, however, the Maryland Transit Administration (MTA) revealed that Purple Line costs had risen yet again to $2.37 billion, as this graph from the Washington Post demonstrates:

The latest increase amounts to $126 million. MTA Project Development Head Henry Kay explained:

the initial $1.2 billion estimate in 2001 probably was based on broad assumptions, such as the average cost per mile for rail construction nationally. As the state has refined the Purple Line design, he said, engineers have found more “challenges” that add costs. . . .

“The [cost estimate] number at that time [in 2001] would have been based on lines on a map,” Kay said.

About 30 percent of the project has been designed, he said, enough to form more precise cost projections.

The excuse that cost estimates have risen because the earlier estimates were only rough estimates is suspicious if only because cost estimates have always increased. They never decline. If the estimates are unbiased, the errors shouldn’t be off only in one direction.

The State also doesn’t mention that Maryland foots the entire bill for every increase. FTA has recommended $900 million in funding. That amount will not increase and may decline. So the amount that the State is on the hook for the project just increased from $1.34 billion to $1.47 billion–a 10% increase.

And that means $126 million less for all other transportation projects in the State of Maryland. It also means that Montgomery and Prince George’s Counties will receive less for other projects since more funds dedicated to this part of the State will have to go to pay for the Purple Line.

One might expect further cost increases if only because Parsons Brinckerhoff is involved. This is the same firm that engineered the botched and way over budget Silver Spring Transit Center. The Center is supposed to accommodate the new Purple Line.

Henry Kay says he has “a high level of confidence” that the new cost estimates are accurate. If so, that would be good news for the State and the future of the Purple Line project.