Tab for South Shore growth up $5 million

The two-story train cars that the South Shore commuter rail line expects to buy next year will be at least $5 million more than officials estimated.

General Manager Gerald Hanas told the Northern Indiana Commuter Transportation District board of directors that the 14 cars, which they hoped to receive in spring of 2008, will cost between $49.8 million and $54.6 million, rather than the earlier estimate of $45 million.

That's partly because they ordered two more cars because of growth.

NICTD officials also had based their estimates on the cost Chicago's Metra system pays for similar cars, Hanas said. However, Metra had an option on them that ends this year, and Sumitomo Corp. of America is adjusting costs for inflation.

The South Shore line, run by NICTD, also requires low-exit stairs and uses a processing system for on-train toilets, so cars will need additional engineering.

The $49 million price tag comes from cost-saving measures, such as computer simulations for engineering testing, Hanas said.

Sumitomo is the only company eligible to produce the rail cars because it was the only company to attend the prebid meeting.

NICTD attorney Charles Lukman said that other companies had been contacted but declined to bid because of the type of car requested and other reasons.

"We received a letter that said, 'Your order's too small,' " he said.

Because of the increased costs and an optimistic estimate of the money NICTD would receive from the Indiana Department of Transportation, rail line officials will present financing options to NICTD directors in January.

They will borrow up to $30 million using federal grants to pay it off, Hanas said. He anticipates interest rates between 4 percent and 4.75 percent based on talks with financial institutions.

The 14 new cars will supplement the 68 the South Shore line has now to keep up with the increasing ridership, Hanas said. They will arrive between 18 and 22 months after the ordering process starts in January.

The new cars will increase the number of seats on the usual two-car train from 206 to 268.

Also at the meeting, the NICTD board increased Hanas' salary 11 percent from $125,000 to $140,000 annually to keep it competitive with salaries for general managers at other small commuter lines.