Sunday, July 19, 2009

$2.3 billion does not come close to real Zoo Interchange project costs

The Wisconsin Department of Transportation isn't coming anywhere close to the entire truth when it says the Zoo Interchange reconstruction project will cost $2.3 billion.

That is way, way, way too low.

First, it doesn't include interest on bonding. If WisDOT bonds half the project cost (roughly its share of the Marquette Interchange project costs), or $1.15 billion, over 30 years at 7% interest, its interest payments alone will total about $1.6 billion.

Yup, interest paid out of the public pocket on Zoo Interchange bonding could amount to more than twice the base cost of the entire Marquette Interchange reconstruction project.

You can certainly play with the numbers -- a 4% interest rate would mean $835 million in interest payments and a 4% rate with a 20-year payback would mean $532 million in interest payments.

But interest payments are not the only cost WisDOT is conveniently not talking about. The agency's draft environmental impact statement discusses the need to move many, many utility towers that are in the way of the proposed freeway. Some of those costs are included in the $2.3 billion project cost that WisDOT cites, but it is likely that millions and millions and millions in costs related to moving the towers will be incurred by We Energies and American Transmission Co. and, of course, its ratepayers.

WisDOT isn't talking about those costs because they are not state costs. They are, however, our costs, ones we will all be paying through our utility bills. Those costs need to be part of the discussion.

WisDOT has an obligation to the public to talk about the total bill for the Zoo Interchange before design decisions on the project are made.

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