**Silver Line Phase III**

**Boston, Massachusetts**

(November 2004)

The Massachusetts Bay Transportation Authority (MBTA) is proposing to
implement Phase III of its Silver Line bus rapid transit (BRT) system in
downtown Boston. The Phase III project is a 1.0-mile tunnel under
Tremont and Essex Streets connecting existing (Phase I) Silver Line
service operating on Washington Street between Dudley Square and the New
England Medical Center (NEMC) with guideway BRT (Phase II) scheduled to
open in late 2004 between MBTA's South Station and the World Trade
Center in the South Boston Waterfront area. In addition to new tunnel
construction, the Phase III project would add BRT passenger boarding
platforms at three MBTA rail stations (Chinatown, Boylston and the
NEMC); implement a turnaround loop under Boylston and Charles Streets to
serve both inbound and outbound trips out of the Boylston station; and
procure 55 new dual-mode articulated low-floor buses that would operate
along the length of the fully constructed Silver Line. Eight routes are
proposed to operate in the Silver Line Phase III tunnel, resulting in
peak period service from Boylston station every minute, from Dudley
Square every four minutes, and from the Back Bay every 10 minutes.

Planned development in the Waterfront area adjacent to downtown Boston
is expected to result in significant growth in travel from the region.
In addition, the opening of the Ted Williams tunnel between the
Waterfront and East Boston provides for an alternative crossing from
downtown and points south, east, and west to Logan Airport. By
connecting the Silver Line Phase I and II projects, the proposed Phase
III project would result in a one-seat ride from as far south as Roxbury
and as far west as the Back Bay area to these destinations. The project
is further intended to provide more direct east-west connections between
MBTA's Green, Orange, and Red rapid transit lines (which essentially run
north-south through Boston's Financial District), as well as improved
mobility for a largely transit-dependent population in the Chinatown
area of downtown Boston.

+------------------------------------+---------------------------------+
| **Summary Description**            |                                 |
+------------------------------------+---------------------------------+
| **Proposed Project:**              | Bus Rapid Transit               |
+------------------------------------+---------------------------------+
| ** **                              | 1.0 Miles                       |
|                                    |                                 |
|                                    | 3 Stations (add platforms at    |
|                                    | existing stations)              |
+------------------------------------+---------------------------------+
| **Total Capital Cost (\$YOE):**    | \$780.5 Million (includes \$3.9 |
|                                    | million in finance charges)     |
+------------------------------------+---------------------------------+
| **Section 5309 New Starts Share    | \$468.3 Million (60.0%)         |
| (\$YOE):**                         |                                 |
+------------------------------------+---------------------------------+
| **Annual Forecast Year Operating   | \$10.7 Million                  |
| Cost:**                            |                                 |
+------------------------------------+---------------------------------+
| **Ridership Forecast (2025):**     | 99,500 Average Weekday          |
|                                    | Ridership                       |
+------------------------------------+---------------------------------+
| ** **                              | 14,500 Daily New Riders         |
+------------------------------------+---------------------------------+
| **Opening Year Ridership Forecast  | # 8                             |
| (2011):**                          | 9,700 Average Weekday Ridership |
+------------------------------------+---------------------------------+
| **FY 2006 Finance Rating:**        | # Medium                        |
+------------------------------------+---------------------------------+
| **FY 2006 Project Justification    | **Medium-High**                 |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+
| **FY 2006 Overall Project          | ### Recommended                 |
| Rating:**                          |                                 |
+------------------------------------+---------------------------------+

MBTA has made great progress in financial planning for both Silver Line
Phase III and its entire system. Prior to advancing the project into
final design, MBTA must ensure that the capital cost estimate is based
on a validated construction schedule; that the financial plan adequately
addresses all of the agency\'s needs, including rehabilitation and
replacement of existing capital assets and the purchase of additional
equipment needed to meet projected ridership throughout the system; and
that funding arrangements are in place to build and operate projects
identified in the Commonwealth's Administrative Consent Order.

**Project Development History and Current Status**

In February 1993, MBTA completed an alternatives analysis/Draft
Environmental Impact Statement (EIS) in the South Boston Piers corridor
resulting in the selection of a 1.5-mile underground transit tunnel from
Boylston Station to the World Trade Center as the locally preferred
alternative (LPA). FTA issued a NEPA Record of Decision on the LPA in
May 1994, and executed a Full Funding Grant Agreement on a portion of
the LPA from South Station to the World Trade Center later that year.
The Silver Line Phase III project is the remaining part of the 1994 LPA,
combined with a continuation of a tunnel under Tremont Street to connect
with Washington Street BRT service at the NEMC. FTA approved the Phase
III project into preliminary engineering in July 2002. Subsequent
modifications to the underground alignment resulted in the initiation of
a Supplemental Draft EIS in June 2004. The Supplemental Draft EIS is
anticipated to be completed in early 2005, with a NEPA Record of
Decision and MBTA request to advance the project into final design
expected later in the year.

**Significant Changes Since Last Evaluation** (**November 2003**)

MBTA modified the project scope to include relocation of the turnaround
loop and Boylston station BRT platforms, and to provide for a new BRT
bus route into the Back Bay. The project's capital cost estimate has
been revised to reflect these changes. In response to FTA comments, MBTA
developed and implemented a new transit systemwide operations and
maintenance cost model, and produced and submitted improved travel
forecasts. MBTA also increased the proposed New Starts share of project
costs from 50 to 60 percent.

###### Project Justification Rating: Medium-High

The project is rated *Medium-High* for project justification based on a
*Medium* cost effectiveness rating and a *High* rating for
transit-supportive land use.

####### *Cost Effectiveness Rating: Medium*

The *Medium* rating reflects the good level of travel-time benefits
(13,000 weekday hours) generated by the project relative to its
annualized costs. FTA believes that the project cost estimate is current
and reliable for this early stage of development, but notes that it is
subject to finalization of scope and schedule. Any changes could impact
the project's cost effectiveness.

+------------------------------------------+---------------------------+
| **Cost Effectiveness**                   |                           |
+------------------------------------------+---------------------------+
| Cost per Hour of Transportation System   | **[New Start vs.          |
| User Benefit                             | Baseline]{.underline}**   |
|                                          |                           |
| Incremental Cost per Incremental Trip    | \$15.84\*                 |
|                                          |                           |
|                                          | \$15.31                   |
+------------------------------------------+---------------------------+

####### \* Indicates that measure is a component of Cost Effectiveness rating.

Implementation of the project would close the physical gap between Phase
I and Phase II BRT service and would provide a new east-west connection
between several downtown rapid transit stations. These new connections
reduce the need for transfers, reduce in-vehicle travel time, and
decrease walk times for many trips destined for, or through, stations
along the Phase III alignment, all of which contribute to significant
travel-time savings as compared to surface bus operations in the same
area. Specifically, better rapid transit connections to the Financial
District and the Waterfront area are each forecast to account for
roughly 30 percent of travel-time benefits resulting from Phase III
implementation. One-quarter of benefits are estimated to be generated by
transit riders accessing downtown and points south and east from the
Green Line, who would substitute a circuitous transfer to the Red Line
for a direct Silver Line connection at Boylston Station or along the
Back Bay BRT route.

Project costs reflect all tunnel construction and are comparable to
estimates of other below-grade New Starts projects. Healthy
contingencies mitigate some risk to the cost estimate, which include an
aggressive implementation schedule which may not be achievable.

####### *Transit-Supportive Land Use Rating: High*

The *High* rating is based upon the *High* ratings assigned to existing
land use and transit-supportive plans and policies, and the
*Medium-High* rating assigned to the performance of such policies.

**Existing Land Use: High**

-   The current number of employees within the Phase III corridor is
    approximately 195,000. Population density within the corridor is
    high, with approximately 16,200 persons per square mile.

-   Downtown Boston contains major concentrations of office employment,
    the city's retail shopping core, most of the city's major hotels,
    tourist destinations, major transportation facilities and
    residential areas. The South Boston Waterfront features an
    increasing number of mixed use developments. Multiple distinct
    neighborhoods are linked together by Washington Street with a
    variety of high-density residential and commercial uses.

-   Parking supply is limited in the CBD, South Boston, and Waterfront
    area. The typical parking rate is \$30 per day, which is among the
    most expensive in the country.

**Transit-Supportive Plans and Policies: High**

-   The Silver Line is located in an established urban environment
    limited to redevelopment and infill opportunities. Development in
    suburban areas and the urban fringe of Boston is limited in many
    areas by local land conservation policies and a general lack of
    developable land.

-   The Boston Redevelopment Authority (BRA) is working to encourage
    greater density in commercial and residential development near
    public transportation. Its Transit Oriented Housing Program assists
    developers in the creation of high-density housing developments in
    areas easily accessible to transit. BRA has adopted prototype
    standards for transit-oriented development, which will enhance the
    transit-friendly characteristics of the station and surrounding
    neighborhoods.

-   The city of Boston has deliberately constrained automobile parking
    over the last 50 years to encourage transit use. Boston has
    instituted a freeze on commercial public parking spaces in the
    central business disctrict, limiting the number of public spaces in
    the downtown to 35,500.

**Performance and Impacts of Policies:** **Medium-High**

-   The high transit and walking mode share to downtown provides strong
    incentives for developers to locate buildings convenient to transit.
    Recently completed developments within the Silver Line corridor
    illustrate both the density and pedestrian-orientation of new
    development.

-   In the vicinity of the Phase III project, new development is tightly
    constrained by the availability of developable sites. Development
    proposals are already under BRA review for most of the currently
    feasible sites within the section. Of the total 7.44 million square
    feet of proposed development in the corridor, more than half are
    located within the downtown section of the Silver Line.

####### Other Project Justification Criteria 

+------------------------------------------+--------------+------------+
| **Mobility Improvements Rating:          |              |            |
| Medium-High**                            |              |            |
+------------------------------------------+--------------+------------+
| **[Within ½-mile radius of boarding      | 195,000      |            |
| areas]{.underline}:**                    |              |            |
|                                          | 219,700      |            |
| Existing Employment                      |              |            |
|                                          | 2,000 (20%)  |            |
| Projected Employment (2025)              |              |            |
|                                          | 65,000\*     |            |
| Low Income Households (% of total HH)    |              |            |
|                                          | 667\*        |            |
| **[Average Per Station]{.underline}:**   |              |            |
|                                          | **[New Start |            |
| Employment                               | vs.          |            |
|                                          | Baseline]{.  |            |
| Low Income Households                    | underline}** |            |
|                                          |              |            |
| **Transportation System User Benefit Per | 11.99\*      |            |
| Project Passenger Mile (Minutes)**       |              |            |
+------------------------------------------+--------------+------------+
| **Environmental Benefits Rating: High**  |              |            |
+------------------------------------------+--------------+------------+
| **[Criteria Pollutant (Reduction in      | **[New Start |            |
| tons)]{.underline}**                     | vs.          |            |
|                                          | Baseline]{.  |            |
| > Carbon Monoxide (CO)                   | underline}** |            |
| >                                        |              |            |
| > Nitrogen Oxide (NO~x~)                 | 77           |            |
| >                                        |              |            |
| > Volatile Organic Compounds (VOC)       | 3            |            |
| >                                        |              |            |
| > Particulate Matter (PM~10~)            | 6            |            |
| >                                        |              |            |
| > Carbon Dioxide (CO~2~)                 | N/A          |            |
|                                          |              |            |
| **[Criteria Pollutant                    | 8,982        |            |
| Status]{.underline}**                    |              |            |
|                                          | **[EPA       |            |
| > Carbon Monoxide                        | De           |            |
| >                                        | signation]{. |            |
| > 1-Hour Ozone (O~3~)                    | underline}** |            |
| >                                        |              |            |
| > 8-Hour Ozone                           | Maintenance  |            |
|                                          | Area\*       |            |
| **Annual Energy Savings (million British |              |            |
| Thermal Units)**                         | Serious      |            |
|                                          | No           |            |
|                                          | n-Attainment |            |
|                                          | Area\*       |            |
|                                          |              |            |
|                                          | Moderate     |            |
|                                          | No           |            |
|                                          | n-Attainment |            |
|                                          | Area\*       |            |
|                                          |              |            |
|                                          | 116,743      |            |
+------------------------------------------+--------------+------------+
| **Operating Efficiencies Rating:         |              |            |
| Medium**                                 |              |            |
+------------------------------------------+--------------+------------+
| **System Operating Cost per**            | > **         | **[New     |
|                                          | [Baseline]{. | Start]{.un |
| **Passenger Mile (current year           | underline}** | derline}** |
| dollars)**                               | >            |            |
|                                          | > \$0.517\*  | \$0.515\*  |
+------------------------------------------+--------------+------------+

\* Indicates that measure is a component of rating for each criterion.

N/A indicates information was not available for this entry.

# [Local Financial Commitment Rating: Medium]{.underline}

The *Medium* rating for local financial commitment is based on *Medium*
ratings for the New Starts share of project costs and for both the
capital and operating finance plans.

####### *Section 5309 New Starts Share of Total Project Costs: 60%* 

####### *Rating: Medium*

MBTA is requesting a 60 percent New Starts share of total project costs,
which results in a *Medium* rating for this measure.

+-------------------------+-----------------------+--------------------+
| **Locally Proposed      |                       |                    |
| Financial Plan**        |                       |                    |
+-------------------------+-----------------------+--------------------+
| **[Source of            | **[Total Funds        | **[Percent of      |
| Funds]{.underline}**    | (\$mi                 | To                 |
|                         | llion)]{.underline}** | tal]{.underline}** |
+-------------------------+-----------------------+--------------------+
| **Federal:**            | \$468.3               | 60.0%              |
|                         |                       |                    |
| Section 5309 New Starts |                       |                    |
+-------------------------+-----------------------+--------------------+
| **Local:**              | \$312.2               | 40.0%              |
|                         |                       |                    |
| Bond Proceeds           |                       |                    |
+-------------------------+-----------------------+--------------------+
| **Total:**              | **\$780.5**           | 100.0%             |
+-------------------------+-----------------------+--------------------+

**NOTE**: The financial plan reflected in this table has been developed
by the project sponsor and does not reflect a commitment by DOT or FTA.
The sum of figures may differ from total as listed due to rounding.

# *Capital Finance Plan Rating: Medium* 

The capital finance plan is rated *Medium*, based upon the average of
the ratings assigned to each of the subfactors listed below. The
completeness subfactor is rated *Medium-High*; capital condition and
commitment of capital funds are rated *Medium*; and the capital funding
capacity and capital cost estimate and planning assumptions subfactors
are rated *Medium-Low*.

#### Agency Capital Condition: Medium

-   MBTA's capital condition rating reflects an old average age of its
    bus fleet (12 years), balanced by the agency's excellent bond
    ratings, which were issued in July 2004 (Moody's Aa1 and Standard &
    Poor's AAA).

#### Completeness of Capital Plan: Medium-High

-   The submission was complete and contained a 20-year cash flow
    statement, identification of key assumptions, fleet management
    plans, and more than five years of historical data. However, the
    plan contained only a limited sensitivity analysis.

#### Commitment of Capital Funds: Medium

-   Over 20 percent of non-New Starts funding is committed. All local
    funding will be derived from bond proceeds backed by dedicated sales
    tax revenues and assessments paid by the municipalities served by
    MBTA.

#### Capital Funding Capacity: Medium-Low

-   The project's financial plan shows projected cash balances, reserve
    accounts, and/or access to credit that would allow MBTA to cover
    cost increases or funding shortfalls equal to approximately 10
    percent of project costs.

#### Capital Cost Estimate and Planning Assumptions: Medium-Low

-   Some of the revenue growth assumptions included in the capital plan
    are optimistic compared to historical experience, particularly sales
    tax revenue growth.

-   The capital cost estimate includes a 50 percent contingency, which
    is fairly conservative. However, inflationary assumptions used to
    develop the capital cost estimate appear optimistic.

#### *Operating Finance Plan Rating: Medium*

The operating finance plan is rated *Medium*, based upon the average of
the ratings of the five subfactors listed below. The commitment of
operating funds subfactor is rated *High*; completeness is rated
*Medium-High*; operating funding capacity and operating cost estimates
and planning assumptions are rated *Medium*; and operating condition is
rated *Medium-Low*.

#### Agency Operating Condition: Medium-Low

-   MBTA's operating condition is fair, with no recent service
    reductions.

```{=html}
<!-- -->
```
-   MBTA's current ratio of assets to liabilities as reported in its
    most recent audited financial statement is only slightly greater
    than 1.0.

#### Completeness of Operating Plan: Medium-High

### The submission contained all required items except an extensive sensitivity analyses.

#### Commitment of Operating Funds: High

-   All operating funding is committed. Operating funding will be
    derived from existing sources, including sales tax revenues and
    local assessments.

#### Operating Funding Capacity: Medium

-   The project's financial plan shows projected cash balances, reserve
    accounts, and/or access to credit of approximately 12 percent of
    annual operating expenses.

#### Operating Cost Estimates and Planning Assumptions: Medium

-   Operating assumptions are generally in line with historical
    experience and, in some cases, are even more conservative than
    historical experience.

-   Submitted information did not provide sufficient evidence that MBTA
    will be able to operate the level of service needed to meet future
    travel demand on the Orange Line.

Map

#### 

###