From Dave Van Hattum, Policy and Advocacy Policy Manager

With planning proceeding for the Southwest LRT along the Kenilworth alignment, now is the time to make sure we provide strong connections to Uptown, the Midtown Greenway and Nicollet Ave (i.e. Eat Street).

Given the extraordinary cost of a Nicollet alignment, TLC supports the 3A, Kenilworth alignment for the Southwest LRT.

TLC also supports a regional plan for a much improved transit system that better serves the large and growing concentration of residential and commercial activity in Uptown. Achieving both of these objectives will require on-going advocacy, organizing, and education.

TLC and others have noted the potential to add a streetcar connection between downtown Minneapolis, Uptown and the Southwest light rail line.

Over a dozen cities in North America currently have streetcar lines and many others are being planned.  Other strategies for increasing transit connections between the Southwest light rail line and Uptown, including arterial bus rapid transit (BRT), should also be explored.

The trick, of course, is funding. Successful streetcars in other cities utilize several different funding sources, including the Federal Transit Administration’s Small Starts program, state and local funding, value capture public financing (i.e. future property tax capacity is frontloaded) and direct private contributions. The Minneapolis Streetcar Feasibility Study identified a range of funding sources (see below and here). The Nicollet Ave and Midtown Greenway alignments had the highest ridership of any of the seven corridors, except Hennepin Ave.

The Federal Transit Administration’s Small Starts program may provide substantial funding for a streetcar. This was the case with the highly successful Portland streetcar, which received $75 million in federal funding for an extension of the line. The Portland Streetcar helped catalyze $2.3 billion in private investment within two blocks of the line and has over 10,000 riders per day. Additional funding came from a variety of local, regional and private sources, including an increase in parking fees.

Tampa, Seattle, Memphis and several other cities currently have streetcars. The new Union Streetcar company, located in Portland, OR, utilized federal stimulus funding to begin producing the first U.S. made streetcars in over a half a century.

In Dallas, the plan is to leverage increased property tax revenues through tax-increment-financing (TIF) and to move forward with or without money from Washington. In Washington, DC, Reconnecting America laid out a funding plan that includes one-third Tax Increment Financing (TIF), one-third special assessment district, and one-third “never-done-before” sharing of private property value increases.

In addition to city funds in Minneapolis, securing funding from the Met Council or the Counties Transit Improvement Board (CTIB) should be thoroughly pursued. However, given intense competition for current funding – many projects are queued up in the CTIB process and the legislature cobbled together a short-term funding solution for a major operating deficit at Metro Transit – success will depend upon strong advocacy for increased transit funding.

The Met Council/Metro Transit’s position on funding a streetcar system is stated as: “The Council will collaborate with local units of government to determine where and when streetcars may be appropriate. If it is determined that streetcars are less cost-effective than buses and that they are being constructed primarily as a development tool, capital costs for streetcars should be funded primarily with local, not regional level.” At the same time, the Met Council identifies Arterial bus rapid transit (BRT), including Nicollet Avenue, as an important area for expanding transit service in the region.

CTIB’s long-term investment framework would seem to preclude funding a streetcar on Nicollet, though not on the Midtown Greenway, as the framework requires transitways to operate on dedicated right-of-ways.

Other Funding options identified in the Minneapolis Streetcar Feasibility Study, January 2008

Federal Funding

  • Project Earmarks/Federal Demonstration Projects
  • Federal Transit Act Formula Funds
  • Housing and Urban Development Funds

State and Local Funding Options

  • Taxes (e.g, local sales tax, hotel guest tax, convention center tax, etc.)
  • Fees (e.g., transit impact development fee, in-lieu of parking fee, etc.)
  • Benefit Districts (e.g., Local Improvement District, Tax Increment Financing, Special Assessment District, etc.)
  • Parking (e.g., meter and/or ramp revenues)
  • Streetcar funding (e.g., farebox revenue, advertising revenue, naming rights)
  • Other (e.g., air rights, non-profit status, etc.)

Transit for Livable Communities looks forward to working with the City of Minneapolis, other government agencies, and all interested stakeholders to fund increased transit connections between uptown, Eat Street and the Southwest LRT.

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