State lowers cost estimate for I-94 reconstruction

The Wisconsin Department of Transportation (WisDOT) today provided an updated cost estimate for the Interstate 94 North-South project that shows a reduction of approximately $262 million through state fiscal year 2021, largely because inflation and actual costs have been less than originally estimated.

The overall cost of the project, which involves expanding and modernizing a 35-mile stretch of highway from the Illinois state line to the Mitchell Interchange, is now estimated at $1.65 billion. The previous estimate established in 2006 had the total project cost at $1.912 billion.

“Since the original estimate for the project was prepared, we have experienced lower than estimated inflation caused by the 2008 recession that helped drive costs down,” said WisDOT Secretary Mark Gottlieb. “The new estimate will provide relief in the amount we will need to request for the project in future budgets, but significant funding will still be required to keep the project on schedule.”

Construction on the project started in 2009 and is scheduled for completion in 2021. As a multi-year project, the department must predict the impact of inflation on the price of materials, labor and other items. The new estimate reflects savings from unrealized inflationary projections.

The department attributes the reduction to two interrelated factors: Initial cost estimates used conservative numbers due to the uncertain economic conditions; and the project has benefited from aggressive bidding from the department’s construction partners. There have also been savings achieved through reduced costs for real estate, utilities and railroad expenses, along with an overall effort by the department to closely manage and control expenditures.

Prices will continue to fluctuate over the next eight years and the department will continue to monitor the estimate.

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