New $6.7 billion price tag makes Caltrain’s SF extension among costliest in the world

For marathon runners, the last mile is often the hardest — and the same apparently holds true for extending Caltrain into downtown San Francisco.

Preparations for the final 1.3-mile leg — pushing trains to the city’s Salesforce Tower — are finally picking up speed after decades of on-and-off planning. But there’s one major hurdle: a new $6.7 billion price tag.

The rail line — also planned as the finishing northern stretch for California’s High-Speed Rail — saw a cost increase of 34% from a 2015 budget, according to a new estimate from the Transbay Joint Powers Authority, which oversees the project.

At $5.15 billion per mile of new track, the Caltrain undertaking is now runner-up for the world’s most costly transit project, behind New York’s notoriously pricey East Side Access project, according to a database at New York University.

The escalating figure is not holding back transit planners. They have set an ambitious 2032 completion date, allocated over $1.7 million toward lobbying the state and federal government for funds, and rebranded the extension with a new name: “The Portal”

“This is a generational investment in our climate, mobility and economic future for California. This is not extending a commuter rail one mile,” said Adam Van De Water, executive director of the TJPA. Instead, he said, Bay Area residents should view the mega project as a linchpin for a climate-friendly future by uniting high-speed rail, bus and BART at San Francisco’s Salesforce Transit Center.

“It is a critical connection to bring those 11 agencies together,” said Van De Water. “So then you can take a bus from any of the Bay Area counties into downtown and hop on Caltrain or high-speed rail and be destined statewide.”

A similar vision for regional transit connectivity is also underway in San Jose, with BART, electrified Caltrain and high-speed rail eventually meeting at Diridon Station. Both transit hubs in San Francisco and San Jose have been dubbed the future “Grand Central Station of the West” by local officials. BART’s $9.4 billion extension through the South Bay is scheduled to open in 2034, two years after the Caltrain extension.

The majority of the Caltrain project’s costs come from building the new underground station and underground tunnel that extends the tracks from Caltrain’s current terminus near Oracle Park at 4th and King to the basement of the Salesforce Transit Center.

Along with tunneling costs, inflation and planning for unforeseen expenses are behind a “conservative but realistic approach” to budgeting, Van De Water said. With an eye toward ballooning costs for bringing BART through San Jose and other mega projects around the country, Caltrain is saving some money by shrinking its tunnel size and eliminating an underground passage from the Salesforce building to the Embarcadero BART Station.

“Every year we don’t get this project underway is almost $300 million in escalation alone,” said Van De Water. “That’s not adding any bell, any whistle any change to the design.”

Alon Levy, who researches transit costs at New York University, called the new budget estimate “horrific” without clear reasoning for the sky-high price tag. The project is expected to cost more than average due to the dense urban location and the inflated price of doing business in San Francisco, said Levy. But the current estimate is “unjustified” considering that much of the heavy lifting was already completed in 2018 when the $2.2 billion Salesforce Transit Center opened with a massive empty basement prepped for Caltrain and high-speed rail’s eventual arrival.

Nevertheless TJPA, along with Caltrain, is embarking on a plan to secure nearly 50% of the funding from the Biden administration. The rest will come from state and local sources, but there are headwinds at the state level as Gov. Gavin Newsom recently proposed axing $2 billion from a key transit infrastructure program that would likely fund The Portal.

While transit planners emphasize The Portal’s tie-in with a future bullet train, it appears unlikely that California’s embattled high-speed rail project will reach Salesforce tower in the coming decades. A high-speed rail link is projected to connect Bakersfield and Merced in the early 2030s, but there is no funding — or major political backing — for the tens of billions of dollars needed to bring a bullet train from the Central Valley to the Bay Area, which would require a contentious 13.5-mile tunnel through the Pacheco Pass, south of San Jose.

Backers of high-speed rail hoped that President Biden would fund the project through his massive infrastructure bill. But the Federal Transit Administration recently rejected a $1.3 billion funding request from the California High-Speed Rail Authority. The FTA determined that the project was not cost-effective.

For Caltrain and The Portal, the other issue is convincing the federal government that it is worthwhile to invest in a transit service and downtown area that is oriented around commuters who have shifted to working from home. Caltrain had one of the nation’s worst ridership collapses. Nearly three years after the COVID pandemic, passenger travel remains down by 60%.

Due to the ridership collapse, Caltrain is projecting an operating deficit that could hamper the rollout of their electrified in trains in 2024.

Tom Rudolovich, a former BART board president and long-time advocate for the extension, said the region needs to think past high sticker prices and fund infrastructure that will be used for generations to come.

“This one is truly transformative,” he said. “We have an obligation to be a good ancestor.”