February 28, 2010

Uncle Sam's Toy Train Set

"There's something about a train that's magic." - Amtrak slogan.

For RTD-Denver's light rail expansion project, the magic is dead on the tracks. According to an article in the February 20th edition of The Economist, FasTracks, the system's third and largest expansion project ground to a halt. An ambitious plan, the Regional Transportation District planned 188 miles of additional commuter rail line to be built by 2017. Residents and visitors in the Denver metropolitan area currently fund this public transport-planner's dream with a 0.4% sales tax. Additionally, billions of dollars of our federal tax money will spur the program. Community leaders holding shiny new shovels and wearing business suits topped with one-and-done construction helmets enjoyed the photo opportunity that celebrated how, as Mayor John Hickenlooper described glowingly, "the whole community came together in the region at a level that we've never seen before." According to the original cheerleaders of the project, without new revenue sources, that same "whole community" must wait until 2042 for FasTracks completion.

Ah, the good old days. Visions of new light rail cars carrying drunken sports spectators from taxpayer-funded downtown sports venues to newly constructed Park and Rides for the remainder of the journey home will remain just visions for a good while longer. Thanks to the media touting whatever lowball budget figure local politicians gave them in order to sell the scheme to hopeful voters, Denver-area taxpayers watch in disgust as the current estimate for the project's cost rises (gasp!) 43%, to $6.5 billion. This predicament is the result of two foreseeable events: the fluctuation in long-run sales tax revenue, and new safety requirements, in this case as a reaction to the deadly incompetence of Los Angeles-area light rail operators.

Hmm, what do you suppose might happen next as local governments across the recession-gripped United States everywhere struggle to find revenue with which to provide the basic public safety and infrastructure maintenance? If you guessed double the tax rate, you've got a future in civic government! Whether Denver-area voters approve a ballot initiative this fall to flush more money into an enterprise which few of them will ever use depends on the velocity and sparkle of the spin that area pols will apply to the "vision."

Thankfully, our paternalistic Uncle Sam came to the rescue last week with $300 million in federal loans, a sure sign that the planned billion dollar grant from the Federal Transit Administration is hiding in the caboose. Why? Hint: it's Washington's favorite four-letter word.

Jobs. The Denver Post quotes U.S. Senator Michael Bennet as saying that construction of rail lines and revitalization of Union Station "conservatively could create 10,000 good-paying jobs throughout the metro area." In a metropolitan area of 2.9 million residents, that's almost a one per cent temporary increase in the employment base - spread over six years.

What costs aren't mentioned by the Post or the elected representatives? Many along the Gold Line to Wheat Ridge and the I-70 corridor to Denver International Airport will be forced to sell their private property at fair market value, not an appealing prospect in the current real estate market. More importantly, RTD seeks to remove hundreds of millions of dollars of spending from the local economy, money which could surely fund thousands of commercial sector jobs in industries which consumers wish to support.

Tragically, few who pay the tax will reap an equivalent value for their lost spending power. For most New York metro-area residents, the inconvenience of walking to a bus station, riding to the rail station, walking to the office and repeating the process in reverse every weekday is a relatively smaller opportunity cost than car ownership, parking fees and hours in traffic. There, such a system has some viability, though the MTA receives state and federal funds for its lifeline. Denver's RTD, however, shamefully touts FasTracks and light rail expansion as vital to maintain the area's standard of living, an area whose inhabitant spread themselves thinly across 700 square miles. Hopefully, Denver area voters will let their elected officials sweat over the promises they made to local commerce leaders. Hopefully, those leaders of commerce get to keep the money that we'd like to spend on their goods.

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