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Tuesday, Dec. 23, 2008

The Case Against Light Rail

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Earlier this month, the Reason Foundation, a libertarian think-tank based in Los Angeles, released a study conducted to assess the costs and benefits of a commuter light rail system being proposed for the corridor between Milwaukee and Racine. Interestingly, only those who listen to local talk radio would know that this study exists, as it was barely covered in the local media.

The study was conducted by Thomas Rubin, a transit consultant also based in Los Angeles. Rubin's conclusion is that the Kenosha-Racine-Milwaukee commuter light rail line (KRM) could not reach new rider goals, nor could it sustain the projected amount of riders. Rubin's study also questioned numbers put forth by a January 2007 study of the KRM plan conducted by the University of Wisconsin- Milwaukee's Institute for Survey and Policy Research.

The UWM study concluded that the KRM project would have a $560 million impact on "the area economy." The Reason Foundation study points out that this figure assumes that all materials used in the project would come from local sources- including the $48 million in specialized rail cars- but there is no facility in the Midwest equipped to produce these two-car diesel multiple units.

Another point made by the Reason Foundation study compares the travel time from Milwaukee to Kenosha and Chicago of the existing Amtrak Hiawatha line and the proposed KRM line. Amtrak takes passengers from downtown Milwaukee to downtown Chicago in 89 minutes. The same trip on the KRM would take 163 minutes, assuming a 5 minute wait for the Metra train in Kenosha. Milwaukee to Kenosha alone would take 53 minutes on the KRM.

The most unfortunate aspect of the proposed KRM line, from the taxpayer's perspective, is the fact that each ride is projected to cost $28 (one-way). The cost per ride is proposed to be $2.92. That leaves over $25 to be subsidized by the taxpayer.

The UWM study's numbers are sketchy at best, even for the casual observer. Take, for instance, this paragraph from the executive summary:

"The estimated development/redevelopment within one-half mile of the nine KRM stations includes:

· 23,000 residential units

· 7.6 million square feet of retail space

· 4.7 million square feet of office space

· 71,000 jobs

· $7.9 billion increase in property value

Without KRM commuter rail, 20 to 50 percent of this potential development would not

be expected to take place."

The red flags begin with the word "estimated". "Development/redevelopment" leaves a lot of room for interpretation. The numbers themselves are staggering. It is difficult to imagine any project of any scale that could increase property values in southeastern Wisconsin by $7.9 billion, especially a commuter rail line that runs trains with only two cars each. The last sentence leaves the reader wondering if 20 percent of some amount of "potential development" is worth paying $25 for other people to ride the train to Kenosha.

At what the UWM study calls an "intermediate 10% premium for a one-mile corridor along the KRM rail line" property values would increase $2.1 billion. The Southeastern Wisconsin Regional Transit Authority projects 3,696 projected new daily riders by 2035. Each of these riders would be worth $568,000 in property value increases. If each rider stopped every day at each of the nine KRM stations and patronized each of the big box stores in the vicinity of each station, it is still difficult to see how each rider could be worth more than a half-million dollars, even over the course of 20-25 years.

 

The $2.1 billion question, however, is just who is going to ride the train? And what jobs will they be commuting to. Companies like S.C. Johnson cite the need for commuter light rail to northeastern Illinois in order to attract and retain qualified employees. So, Wisconsin taxpayers should pay $25 per ride to bring someone who pays property taxes in Illinois to their job in Racine? Even the progressive "new math" can't make that equation work.