Re: North-South Rail Link
fattony, digging (no pun) further,
Construction costs of the Big Dig itself were $14.5 Billion.
The state financed $7 billion of this amount through bonds, the interest on the $7 billion borrowed is about $7 billion, so these apparently are mostly 40 year bonds.
The additional $3 billion in Big Dig costs are transportation-related, e.g., Silver Line, Blue Line, etc. The construction cost for these was $1.7 billion, paid for with bonds costing $1.6 billion in interest.
The $24.3 billion does not include the cost of the Green Line extension.
https://www.boston.com/uncategorize...-24-billion-with-interest-officials-determine
Forty year bonds at a fixed 4.25 percent would get you to a point where the interest amount roughly equals the principal.
But that oversimplifies because I doubt the Commonwealth has $7 billion worth of paper all maturing in 2038; there is probably a series of bonds with different 20, 30, and 40 year maturity dates, the last of which is 2038.
From an investor standpoint, lending $x million for 40 years and applying anything but a relatively low discount rate will probably result in negative NPV for the investor.
From my quick read, the financing costs of new construction (tunnels and trackage) and new equipment costs are not included in the most recent cost estimates.
Back to the Big Dig only, the cost to the state only was about $7 billion in construction costs. The Federal printing press paid for the remainder of the construction costs.
On that basis, my eyeball sense is the construction and equipment cost (no financing) to the state for NSRL probably exceeds the inflation-adjusted construction only, state-paid-for Big Dig costs, (after adjusting for inflation between 1996 and 2028).
