Critics: Monorail estimate too high

Adrienne Packer

Friday, March 3, 2000 | 11:13 a.m.

Only two years ago Transco Holdings executive Ron Watson approached a group of influential consultants and offered to build a 3.7-mile monorail linking Bally's hotel-casino to the Las Vegas Hilton.

Cost of construction? Less than $200 million.

But Watson said he was shunned by consultants Bob Broadbent and Cam Walker, who now head the MGM Grand-Bally's Monorail LLC. And, he said, Clark County Commissioner Bruce Woodbury showed no interest. Watson went home to Hawaii.

Now the estimated cost to build the controversial monorail has climbed to $600 million, and Watson is back in the picture. He wants Clark County residents to know he believes they are being taken for a ride.

"It's the biggest joke I have ever seen," Watson said. "We get a kick out of this. When you have the only deal in town and nobody wants to pursue any other deal -- something stinks in the desert."

Watson, however, is considered by both opponents and proponents of the system as a spurned bidder, angry that his Honolulu-based company couldn't land the lucrative contract.

Woodbury said he could not recall talking to Watson or reading Transco's proposal. He said hundreds of companies came forward with varying offers, but only Broadbent's group delivered a formal proposal.

"What we have been moving forward with is the only party who has stepped up to the plate and actually made a proposal and hasn't requested any local or other tax money to do it," Woodbury said.

Woodbury scoffed at Watson's claim that the county approved of the cost increase. In the future, Watson said, the county could point to the price and ask the federal government to match it.

"I'm not surprised people would invent these fantasies," Woodbury said. "It's open season on the monorail. It's so easy to try to find reasons not to do something that is important to the community. There is an endless list of nay-sayers and people who say they could have done it better."

Walker remembers Watson as a man with a proposal, but no financial backing and no credibility.

Walker admitted his consultant company has not been up front with its financial plan. He said the actual construction cost of the project is $340 million. The remainder of the bond would be used for overruns, capital interest and other "safety nets."

"We want a rainy day fund that helps the bond community feel comfortable that this project has enough safety nets," he said.

Watson still doesn't buy it. Watson, who said his company has built trains in Asia and Europe, said he could build the same system with seven stations for less, and he would have kept his word with a contract.

"We're not going to present something we're going to lose on, and we're not going to present something that won't work," Watson said.

Even Broadbent's harshest critic, California-based consultant Jon Twichell, said Watson's estimate was ludicrous. In fact, Twichell said Broadbent's $650 million figure is low.

Twichell's argument is that with a $2 fare, the monorail will never pay for itself and will, in fact, lose money. If Nevada taxpayers don't fund the project, the state's bond rating will suffer, he said.

Meanwhile, estimates Seattle officials have heard while planning a monorail system there suggest the price on the 4-mile Las Vegas system are out of whack.

Paul Elliott, executive director of the Elevated Transportation Company -- a Seattle committee assembled to begin work on an unfunded monorail system approved by voters -- said Las Vegas' system appears to be pricey.

Seattle's system was initially expected to be a 41-mile, X-shaped elevated system, but has since been whittled down to an oval that serves downtown.

A team of consultants -- which included Bombardier, the same transportation company involved in the Las Vegas proposal -- studied the feasibility of the Seattle monorail system. Elliott said the consultants reported that the monorail would cost between $25 million and $50 million per mile to construct.

"I would certainly say Las Vegas' numbers are high," Elliott said.

Larry Fabian, who heads the Trans.21 in Boston and who has published a newsletter on automated people movers since 1985, said different factors such as climate and labor costs play into the total price.

He compared the Las Vegas proposal to a monorail system recently completed in Singapore. Fabian said the Singapore monorail route is about 4.6 miles, serves about 3,300 riders an hour and cost $205 million to build.

"There is no average cost per mile," Fabian said. "But $150 million a mile, that's very high based on any number of projects."

Fabian applauded Broadbent for pursuing a monorail system that someday will be linked with a valleywide monorail planned by the Regional Transportation Commission.

"They should be lauded for doing something that could be wonderful for the city," Fabian said. "The Strip is becoming so congested, it's going to choke on its own success."