Conference calls for mass transit in Detroit

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Conference calls for mass transit in
Detroit by Daniel Duggan Crain's Detroit
Business October 7, 2008 Alan Jacobson ? ECO 5520
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Detroit's competing mass transportation plans
were the subject of discussion at a conference on
urban redevelopment sponsored by the Detroit
chapter of the Urban Land Use Institute held at
Wayne State on Monday, October 6. George
Jackson, CEO of the Detroit Economic Growth
Corp., discussed two plans for a light rail
system for Detroit's Woodward corridor. One is a
publicly financed plan through the Michigan Dept.
of Transportation and the other a privately
funded project. I'm personally pushing for the
private plan, since the other will probably
happen after I retire, said Jackson.
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Public Transport in Detroit Background
Detroit is often seen as the prime culprit of how
public transportation has taken a back seat to
private modes, typically the single occupant
automobile. The graphic shows levels of public
transportation utilization in various US cities.
Source http//upload.wikimedia.org/wikipedia/comm
ons/8/8e/USCommutePatterns2006.png
Detroit is only one of a large number of cities
who rely greatly on private modes of
transportation. The difference between Detroit
and other major urban areas is the relative lack
of transportation options. Public transportation
in the Detroit area is almost exclusively made up
of bus lines part of two separately run systems
with limited cooperation between them.
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Public Transport in Detroit Background
Transportation Riders United, a consumer group
promoting diversification of Detroit transit
options, published these illustrations to show
how transportation choices in Detroit compare to
other cities in spending and costs to
households. The third illustration shows that
Michigan spends virtually all its transportation
appropriations on auto related infra-structure. T
RU's website www.detroittransit.org
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The Plans
The publicly funded effort, initiated by the
Detroit Department of Transportation (DDOT), may
rely on using property tax funding to repay bonds
floated to pay for the capital costs of building
the system. This form of funding, known as tax
increment financing, could also be used to
generate operating funding.
As discussed in a June 23 article in Crain's
Detroit Business, redevelopment spurred by the
transit expansion would leverage property values
and create jobs around the project's immediate
vicinity. The anticipated scope of the public
project would run light rail from downtown to
Eight Mile. A study was commissioned by DDOT as a
first step toward seeking Federal transportation
funding.
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The Plans
The privately funded plan is an initiative linked
to several key business leaders and is part of a
broader tri-county initiative led by former state
Senate leader John Hertel. Few details on the
regional plan are available at this time but are
expected by the end of the year. This proposal
would build a 3.4 mile light rail line from
downtown to midtown, with approximately 12 stops
for a total of 23 stations including the terminal
at Hart Plaza. Private contributions,
sponsorships and foundation grants would fund the
103 million cost of construction. Sources of
funding for operations have not been made public
at this time. Legislation required to establish
a public/private transit authority to proceed
with the effort was approved by the legislature
on October 7. This effort may also utilize the
tax increment funding mentioned before for some
part of the overall funding.
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Economic Analysis
The public plan, and possibly even the privately
funded plan, relies heavily on the generation of
new property tax revenue for funding some or all
construction and operating costs. The additional
cost would be offset by the increased property
values, increase in jobs, quality of life, etc,
noted as Q1. The danger is if it does not, in
which case effected citizens will be forced to
divert spending to pay for the new tax, noted as
Q2.
TAX
Incr in Cost (Tax)?

Incr in Benefits
Q1
Q2
OTHER ITEMS