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SALT LAKE CITY — The Utah Department of Transportation is gearing up for a decision it says will cost taxpayers north of $500 million in an effort to combat the paralyzing skier traffic that stacks up at the bottom of Little Cottonwood Canyon on weekends and powder days.
But opponents and some local leaders say the current proposals, particularly the 8-mile gondola that would take skiers and snowboarders to Snowbird and Alta, will actually cost far more than the current $592 million estimate.
Instead, taxpayers could end up shelling out up to $1 billion, a claim made in the past by Salt Lake County Mayor Jenny Wilson, and echoed on Tuesday by County Councilman Richard Snelgrove.
"In this era of cost overruns and inflation, $592 million? That's not even on the low end," Snelgrove said. "This is a billion-dollar project, if not more."
The current $592 million estimate just includes capital costs — what the state is expected to spend during construction. In the years that follow the project's completion, whether gondola or bus, UDOT says the solution will end up costing far more. Consider this:
- The gondola, running from the proposed La Caille base station, will cost about $7.6 million each winter, and $3 million each summer — totaling $10.6 million annually.
- Then after completion, UDOT estimates an additional $12.5 million in capital costs, expected by 2037, followed by $16.5 million by 2051.
The other proposal is an enhanced bus system with a widened canyon road that UDOT says will cost about $510 million.
- The forecasted operational and maintenance costs for the bus system is $11 million for the winter alone — UDOT has not factored in summer costs because the enhanced busing will only run during ski season, as of now.
- Additional capital costs are expected to follow in 2032, 2037, 2040, 2048 and 2051, totaling almost $95 million.
Cost analyses vary — UDOT estimates that by 2053, the enhanced bus system will run taxpayers around $782 million, and the gondola $724 million. That analysis was completed using the Federal Highway Administration's life cycle cost formula that applies "discounting methods to compare alternatives in current dollars."
Whether that's on the high or low end of the spectrum for maintenance costs, UDOT couldn't say. The two projects are so far outside of the scope of what the department has historically undertaken that Robert Stewart, a UDOT regional manager, said comparing it to past projects is "apples to oranges."
"Either one of these alternatives, if UDOT ends up being the operator of those, it is new territory," said Stewart — territory that the department is excited to explore, he noted.
But UDOT's numbers, particularly for the gondola, are disputed by critics. Mike Douglass, a former engineer and founding member of the anti-gondola group Friends of Little Cottonwood Canyon, conducted his own analysis that puts the cost between $977 million and $1.06 billion by 2053.
"They try to reduce that amount by showing what it would cost if you spend all the money required in the year 2020. The actual real cost will be much worse than what they show," said Douglass.
The longest gondola in the world
For starters, the proposed Little Cottonwood Canyon gondola would be one of the longest and most ambitious aerial ropeways in the world. UDOT settled on a tri-cable system, or 3S gondola — there is only one 3S ropeway operating in North America, Whistler's Peak 2 Peak, which at 2.7 miles cost $51 million to build in 2008.
"The budget for such a complex project would be difficult to estimate or contain," said Stan Christensen, who teaches negotiation and sustainable development at the Stanford School of Engineering and wrote an editorial opposing the gondola in the Deseret News.
"Large, unique and complex construction projects invariably end up over budget, most significantly so. The cost overruns are almost always borne by taxpayers," he said.
Cost overruns in construction projects have become the status quo, Christensen said, pointing to a study from the global audit and advisory firm KPMG that found just 31% of all projects came within 10% of the budget in the past 3 years.
Take the new state prison for example, says Snelgrove, which was initially slated to cost $650 million but ballooned into a billion-plus dollar project.
"Look at any private or governmental major construction project, there's going to be cost overruns and delays," Snelgrove said.
The current proposed location for the gondola's base station — a plot near the upscale restaurant La Caille that was purchased by CW Management, proponents of the gondola, and later subdivided — is near an EPA Superfund site.
Once home to smelters that processed lead and silver ore, building a large base station at the proposed La Caille site might require a remediation project that "could delay the project at the location of the remediation and increase this alternative's construction cost," according to UDOT's environmental impact statement.
"The (EPA's) final report says it's now safe for a groundskeeper to work outside around the La Caille area, right by the gondola base, but they don't say it's safe to dig a huge new hole for a parking structure," said Douglass, with Friends of Little Cottonwood Canyon.
In a statement, UDOT spokesman John Gleason says it would not need to remediate the entire site, and the department "does not believe that these measures would be so exorbitantly high to materially affect the overall construction costs."
What about earthquakes?
The current environmental impact statement does not include plans for earthquake mitigation. UDOT took fault lines into consideration while narrowing down potential base stations, but a full seismic analysis is not required.
The final design of the gondola, both for the towers and stations, will meet Utah code for faults and earthquakes, Gleason said, but the size of the project has some skeptical that seismic mitigation will stay within the budget's confines.
"You would have to put the equivalent of a shock absorber under a 230-foot tower with tons of weight on it. I don't even know if you can do that, but it's going to be extremely expensive," Douglass said.
Inflation, labor shortages and skyrocketing construction costs
Lastly, the estimates were made prior to inflation, and didn't factor in the rising cost of steel and other construction materials like concrete. Although the price of steel is starting to taper off, prices were up 200% after the first year of the pandemic.
UDOT's analysis does account for an annual 2% increase in operation and maintenance costs.
"But those days are long gone," said Douglass, whose own analysis in 2022 dollars would turn the gondola into a $1 billion-plus project.
"Just their financial basis for looking at the money in 2020 needs a serious re-look in today's climate, which is quite a bit different," he said.
Gleason said the department added a 10% contingency to the cost estimates to cover unknowns. But UDOT acknowledged the true cost of construction will likely increase as the country grapples with rising prices.
"The actual cost of construction would likely be higher because of inflation between 2020 and the year of construction, but the costs are expected to increase proportionally between the alternatives," Gleason said.
'Why would we spend a billion dollars?'
Snelgrove on Tuesday reiterated a point made time and time again by local policymakers, from newly elected Sandy Mayor Monica Zoltanski to Salt Lake County Mayor Jenny Wilson — both proposals are a waste of money, they say.
"Taxpayers statewide would pay for this Little Cottonwood boondoggle," Snelgrove said. "And we have more pressing issues statewide."
That supposedly conservative estimate of $592 million for the gondola could subsidize public transit fares from December through March for 17 years, the councilman said. Or it could fund new east to west transportation in Salt Lake County, which Snelgrove says is "constantly an issue."
How else could the state spend $500 million? Double tracking portions of Utah's FrontRunner train, solving Sandy's affordable housing crisis and building a vast network of bike infrastructure are other suggestions thrown around by local leaders and gondola opponents.
As for Little Cottonwood Canyon, they want to see cheaper, "commonsense solutions" that include more mobility hubs, an enhanced public transit system (without widening the road), tolling, more incentives for carpooling and investments in technology to help with the parking crunch.
"Why would we spend a billion dollars when we could do that first?" Snelgrove asked.
Chris McCandless, founder of CW Management and a proponent of the gondola, said the issue has become overly politicized.
"This is way too important to become politicized," he said. "... I'm not going to be here to enjoy either the bus or the gondola — but the gondola is the right choice."
The decision was recently delayed, with the original recommendation slated to come from UDOT this spring now pushed into the summer — UDOT says it is on track to unveil the recommendation in the coming weeks.
The department will identify a "single preferred alternative," followed by a 30-day public review period. UDOT will then select its final recommendation by winter, which could mean 2023. The debate will then make its way to the Legislature, which will ultimately have the final say in whether the project is funded.