Category: MTC

How to pay for future transit? MTC to study

Mecklenburg’s transit agency, the Metropolitan Transit Commission, is launching a study group to look at how to pay for future transit projects.

According to a news release from Charlotte Mayor and MTC Chairman Anthony Foxx’s office, the working group’s leaders will be Huntersville Mayor Jill Swain, a Republican, and Charlotte City Council member David Howard, a Democrat who chairs the council’s Transportation and Planning Committee.

Finding new money for transit projects beyond the Blue Line Extension has been difficult. Revenues from the half-cent sales tax for transit tumbled after the 2008 financial crash. Federal funding is highly competitive, and state transit funding has been cut and with a Republican-led General Assembly, may be cut further. The study group will look at a variety of transit-funding strategies, including tax-increment financing, synthetic tax-increment financing, special tax districts, and more.

  Here’s the press release sent by Mayor Anthony Foxx’s office:


METROPOLITAN TRANSIT COMMISSION FORMS WORKING GROUP TO STUDY 2030 TRANSIT PLAN FUNDING
Charlotte, NC— At a meeting of the Metropolitan Transit Commission (MTC) Wednesday night, MTC Chair Charlotte Mayor Anthony Foxx urged the formation of a working group to study funding for future transit projects.  This action follows an October decision by the MTC to convene a workshop, currently scheduled for April, to consider and adopt strategies to fund the 2030 Transit Plan. 
The working group will be co-led by Huntersville Mayor Jill Swain and Charlotte City Councilman David Howard, and include MTC staff, MTC member mayors or their designees, and business and community leaders from participating jurisdictions.
“As I and many others have been saying, our funding environment has changed, making it harder to see any future transit projects happening over the next 10 to 20 years,” Foxx said.  “We need to explore all options available to us to complete, and perhaps accelerate, our long-term regional transit plans.  Connecting our region through transit is critical both to our future economic prosperity and to managing our exponential population growth.”
“I believe that if we are to have a vision for the future, it’s imperative for us as a collective group to look at creative financing mechanisms for our transit plan and explore anything that can help us achieve our goals,” Swain said.  “Analyzing our future transit issues is at least as important, if not more so, than addressing our current ones.”
“There’s nothing more important to Charlotte’s future than figuring out our mass transit system,” Howard said.  “I look forward to working with Mayor Swain and the rest of the working group to find ways to make sure we move our transit plan forward as it will be one of the things that will most define us as we go to the next level as a city and a region.”
The working group will submit its findings and recommendations to the MTC in a report due no later than April 15.  The group will consider such financing strategies as: Tax Increment Financing (TIFs), Synthetic Tax Increment Financing (STIFs), Tax Increment Grant (TIGs), Business Privilege Licensing Tax, sales tax revenue, and incremental property taxes.  It will also consider which strategies are currently available to local governments and which would require additional County, voter, and/or North Carolina General Assembly authorization. 
The Charlotte Area Transit System will be the lead agency in supporting the working group.
The formation of the working group comes at a critical time for the Charlotte region’s transit system:
  • Transit sales tax revenues dropped during the recession to 2005 levels, eliminating capacity to fund projects beyond the Blue Line Extension.
  • The Blue Line Extension, the single largest capital project in Charlotte’s history, has required increased property taxes from at least three jurisdictions.
  • The General Assembly has already eliminated $6 million in matching transit funding, increasing concerns that matches for future projects will be eliminated and may require increased local commitments.
  • New federal policies and funding approaches may make funding the 2030 Transit Plan less predictable than in previous years.
  • The Charlotte region is the fastest-growing urban area in the nation.
More information on the MTC’s 2030 Transit Plan is available here. 

Transit? ‘It’s going to take decades and decades’

Streetcar in Portland, Ore. Can Charlotte’s project find funding? (Photo: David Walters)

The big picture may have gotten buried Tuesday as Charlotte City Council members chewed over, and chewed and chewed, different alternative revenue strategies that might enable the city to build the second leg of its proposed streetcar.

Most of the discussion was about finding ways to pay for the streetcar project that weren’t a simple, citywide property tax increase. But here’s the big picture, as articulated by City Manager Curt Walton: “The Blue Line Extension is likely to be the last project of its kind.”

That $1.1 billion project recently won federal funding for half its cost.

Don’t expect Congress to continue to fund a public transit program that pays half the cost of building, Walton said. As for the other proposed 2030 Plan transit projects – the Red Line commuter rail, the Silver Line corridor to the southeast, the West corridor  toward the airport, Walton said, “We’re not going to get those anytime soon. It’s going to take decades and decades and decades.”

The first streetcar leg – from Presbyterian Hospital to the Transportation Center on East Trade Street – is being built with a $25 million federal grant and $12 million in city funds. The $119 million second leg – from the Transportation Center to Johnson C. Smith University and from the hospital to Sunnyside Avenue near Central Avenue – was a piece of a $926 million, eight-year Capital Improvement Plan that did not win council support in June. The whole CIP would have required a 3.6-cent increase in the city property tax.

Meeting for the second in a series of budget-specific sessions, the council spent most of two hours talking about different revenue tools for the streetcar. Although the streetcar project (from Beatties Ford Road at Interstate 85 to the former Eastland Mall site) is a part of the Metropolitan Transit Commission’s 2030 transit plan, it’s far down the list of projects, and the transit sales tax isn’t bringing in enough revenue to let the MTC build any projects after the Blue Line Extension, due to start construction next year.

 So the City Council decided to move ahead on its own with the streetcar project, using only city money. But council members haven’t agreed how or whether to pay for the extension. Tuesday, most council members agreed to keep looking for tools such as Tax Increment Financing, Synthetic Tax Increment Financing, Special Assessment Districts and Municipal Service Districts to help with the streetcar funding. (To read more about what all those things are, click here to download the city staff’s presentation from Tuesday. Bonus: You’ll get a copy of a consultant’s economic analysis of the streetcar’s development potential from 2009.) All are essentially property taxes but would use the higher property tax revenues from the development the streetcar is expected to lure to the route. For instance, a Municipal Service District assesses a special property tax over a certain part of the city, to be used for specific purposes to improve that area. Examples are Charlotte Center City Partners and University City Partners.

Unlike cities in some other states, Charlotte council members aren’t empowered can’t decide to raise sales taxes or create a local income tax, or even create a parking space surcharge. In North Carolina, cities have little leeway beyond property taxes and some specific fees (water/sewer services and development-related fees) for raising revenue. (For more about the ways cities around the U.S. lack the ability to chart their own financial destinies, see this AtlanticCities.com piece,”To Fix Municipal Finances, States Need to Back Off.“)

Some city council members have asked city staff for more information about the possibility of using a Business Privilege License Tax  (which N.C. cities can levy, under certain conditions) that would apply to parking businesses, on a per-space basis. The city staff said its very rough estimate of what would be needed to raise $5 million a year via the BPL tax on parking spaces would cost roughly $110 per space per year.

My prediction: This will not be the last time you hear of all those tools – TIFs, MSDs, STIFs, SADs, BPLs, and so on – discussed as possible ways to pay for transit projects. As Walton warned, cities across America will have to look to urban-region taxpayers to fund their own transit projects. Whether that’s fair or wise national transportation policy is a question for another day. Regardless of the answers, it’s likely to be reality for the coming decades.

Carroll Gray to leave N.Meck transportation group

DavidsonNews.net tells us former Charlotte Chamber CEO Carroll Gray has told the Lake Norman Transportation Commission he’ll leave the commission’s executive director job at the end of this year. Gray, 71, of Cornelius helped launch and lead the regional lobbying group over the past three years. He told DavidsonNews.net he has mixed emotions about the decision, “but I think it’s time to move on.”
The LNTC has been effective in getting the long-planned and long-sidetracked proposal for commuter rail service from uptown Charlotte to Davidson (and possibly Mooresville) back into the mix for the Metropolitan Transit Commission, the group that oversees the Charlotte Area Transit System.

See my earlier posts on changes afoot in the strategy for funding the Red Line:
“Charlotte transit plans due for a makeover?”
and
“New strategy for transit to North Meck”

Charlotte’s transit plans due for a make-over?

It appears some basic assumptions about Charlotte’s transit lines may be about to change.

One: The North Corridor transit line (formerly the Purple Line but now the Red Line) will be commuter rail on a little-used Norfolk Southern rail right-of-way leading from uptown to Mooresville in Iredell County.

Two: The Southeast Corridor (a.k.a. the Silver Line) will run down the center of Independence Boulevard from uptown to the Levine Campus of Central Piedmont Community College in Matthews. It’s going to be bus rapid transit. Or maybe rail. In 2006 the Metropolitan Transit Commission agreed that BRT was the preferred alternative but it would wait at least five years to see if light rail made more sense by then.

But the governing body for transit in Mecklenburg County, the Metropolitan Transit Commission, heard two reports Wednesday night that contemplate changing both those assumptions. (My posting on the Red Line proposal. And my posting on the Silver Line proposal.) The MTC hasn’t voted yet on either, but the discussion and questions didn’t point to huge disagreements – at least not openly.

The problems, of course, stem from the MTC’s diminished expectations for money. It can’t afford to build and operate all five transit lines first envisioned in the mid-1990s.

The problem is especially acute for the Red Line, which has beaucoup ardent supporters in the north Mecklenburg towns of Huntersville, Cornelius and Davidson, who point out that the line is pretty much shovel-ready. Except for that pesky money thing. The new idea is borne of a strong push from the North Meck towns, who pooled their money and created the Lake Norman Transportation Commission, with former Charlotte Chamber CEO Carroll Gray as director. They’ve been strategically pushing political buttons and have succeeded in getting the attention of the N.C. Department of Transportation, among others.

Basically, they’re looking for a strategy that will help find funding to make up for the lack of federal funding, which originally had been expected to pay 25 percent of the costs.

The new strategy: Position the rail line as “economic development,” not just “carrying passengers.” Be open to partnering with freight operations, which opens up new potential lending and other strategies. It’s not “commuter rail,” per se, but “rail.”  You’ve heard of TOD – transit-oriented development? Wednesday night there was talk of FOD – freight-oriented development.

For the Silver Line, the problem is also funding. This Southeast Corridor has been contentious. The vocal and organized neighborhood groups in East Charlotte have not been keen on the concept of any form of bus transit. Bus routes haven’t been shown to perk up development the way rail does, although BRT supporters note that a fixed bus way is different from a changeable bus route on city streets. Hence the maybe-bus-maybe-rail position of the MTC.

But, as I and others have written, expecting any form of transit along Independence Boulevard to spark much pedestrian-friendly, close-knit transit-oriented development means closing your eyes to the reality of Independence. It’s a freeway that barrels through miles of highway-oriented, suburban strip development.  Unless someone plans to bulldoze miles of buildings and rebuild from the dirt up – which no one does, due to expense and the sheer impracticality of that notion – it’s not going to be in the same universe as “walkable” for many generations to come.

A group from the nonprofit Urban Land Institute studied Indy Boulevard last year and recommended scrapping, for good, the idea of light rail down its median.  You wouldn’t get much development anyway, the ULI panel said.  Instead, focus on the proposed Central Avenue streetcar and add a streetcar down Monroe Road as well. Since that proposal, a task force has been meeting and it’s recommending similarly.  It suggests being a tad vaguer about that Monroe Road streetcar in case some form of light rail down the CSX rail line to Matthews emerges as a possibility.

But it is suggesting the MTC “rescind the provision that reserves space in the center of the [Independence] highway.” Use that space, now a high-occupancy-vehicle lane used only by buses, for a high-occupancy-toll lane to be used by buses and motorists willing to pay a toll to escape the regular Indy Boulevard congestion.

It was inevitable, of course, that the original five-corridor plans for Charlotte’s transit system would evolve. In the next few months, look for some significant evolutions to take place.

Whatever do we do with Independence Boulevard?

Charlotte’s “hell highway” is never referred to by that term at public meetings. But that’s what it is. Tonight, the Metropolitan Transit Commission is chewing over some recommendations from a group of officials and citizens over what, really, needs to happen to the now-vintage plans for light rail down Independence.

(Here’s UNCC Professor David Walters’ recent essay on the same topic.)

A panel from the nonprofit Urban Land Institute last winter recommended rethinking the earlier idea to put a light rail line down the median of Indy Blvd.  The ULI panel pointed out the obvious: Putting a transit station in the middle of a huge multilane freeway would be about as pedestrian-unfriendly as you could be, and other cities have found you don’t get much transit-oriented development at light rail stops along freeways. Turn the median into a high-occupancy-toll lane for buses and cars, and put the rail transit along Central Avenue (as in the planned streetcar) and along Monroe Road.

For the past six months a task force of transit, transportation and East Charlotte representatives has been meeting to see what, if any, of the ULI recommendations should be pursued. Tonight, the MTC heard its recommendations. In a nutshell: Do what the ULI said, only be more flexible in where, exactly, the rail transit along Monroe Road should go.

“The Metropolitan Transit Commission should rescind the special provision in the 2006 Transit System Plan that calls for preserving the ability to construct light rail transit or bus rapid transit in the center of Independence Boulevard,” the task force says in a letter to Charlotte Mayor Anthony Foxx, who chairs the MTC.

MTC discussion was lively and enthusiastic – more so, really, than for the Red Line task force report earlier. Matthews Mayor Jim Taylor noted that “Union County [just southeast of Charlotte] seems to be the most interested I’ve ever seen them to be in the past 10 years.” Getting tax-averse Union County interested in anything involving light rail transit would be a sea change in the local transit landscape.

And one tidbit: The state highway project to turn Indy Boulevard into a freeway has been nicknamed a “one mile per decade” project.

Want your face on the side of a bus? Now it’s possible

Advertising’s coming back to Charlotte city buses. And it’s coming to light rail cars – an option not available in 2001, when the governing body for the Charlotte Area Transit System voted to remove the ads from bus exteriors.

The Metropolitan Transit Commission’s vote was about as split as it is possible for such a vote to be. Each municipality has one vote, as do the county and the N.C. Board of Transportation representative (currently developer John Collett). The first vote Wednesday night, on a motion to approve the new advertising , was 4-4, with Matthews Public Works Director Ralph Messera abstaining. Because of the tie, MTC chair and Mecklenburg County commissioners’ chair Jennifer Roberts declared the motion failed, until someone pointed out an “abstain” vote is counted as a yes. That made the vote 5-4.

Messera said he abstained because, while he believed Matthews Mayor James Taylor was in favor, he had not had a specific conversation to nail down how he wanted Matthews to vote.

Olaf Kinard of CATS said projections showed CATS would clear between $900,000 to $1 million a year over five years, taking into account its expenses for putting the advertising program into effect

Revenue from the county’s half-cent sales tax for transit has been flat, while the system’s 2030 plan for building more light rail, streetcar and possibly bus rapid transit corridors is based on a projection that shows those revenues steadily climbing. So the MTC has been pondering whether to look for more revenue opportunities.

Why vote against what, to some, would seem a no-brainer idea for more revenue? Huntersville Mayor Jill Swain said she worried about quality control for the ads. Others pointed out that CATS has spent the past 10 years positioning itself, to the public, as a clean and efficient bus and transit system. The image issue was a key reason the MTC abandoned ads on buses in 2001. “We’re violating the brand we established 10 years ago,” said Davidson Mayor John Woods.

Looking ahead, there’s a decent possibility the MTC will go to voters in coming years for new taxes or other public revenue. It would be even harder for the MTC to ask for new public revenue if it were still rejecting a revenue stream that many in the public consider low-hanging fruit to be plucked.
Photo: Get ready for more advertising on CATS buses, such as this on promoting Charlotte Motor Speedway’s October races. Credit: Charlotte Observer file photo

Want your face on the side of a bus? Now it’s possible

Advertising’s coming back to Charlotte city buses. And it’s coming to light rail cars – an option not available in 2001, when the governing body for the Charlotte Area Transit System voted to remove the ads from bus exteriors.

The Metropolitan Transit Commission’s vote was about as split as it is possible for such a vote to be. Each municipality has one vote, as do the county and the N.C. Board of Transportation representative (currently developer John Collett). The first vote Wednesday night, on a motion to approve the new advertising , was 4-4, with Matthews Public Works Director Ralph Messera abstaining. Because of the tie, MTC chair and Mecklenburg County commissioners’ chair Jennifer Roberts declared the motion failed, until someone pointed out an “abstain” vote is counted as a yes. That made the vote 5-4.

Messera said he abstained because, while he believed Matthews Mayor James Taylor was in favor, he had not had a specific conversation to nail down how he wanted Matthews to vote.

Olaf Kinard of CATS said projections showed CATS would clear between $900,000 to $1 million a year over five years, taking into account its expenses for putting the advertising program into effect

Revenue from the county’s half-cent sales tax for transit has been flat, while the system’s 2030 plan for building more light rail, streetcar and possibly bus rapid transit corridors is based on a projection that shows those revenues steadily climbing. So the MTC has been pondering whether to look for more revenue opportunities.

Why vote against what, to some, would seem a no-brainer idea for more revenue? Huntersville Mayor Jill Swain said she worried about quality control for the ads. Others pointed out that CATS has spent the past 10 years positioning itself, to the public, as a clean and efficient bus and transit system. The image issue was a key reason the MTC abandoned ads on buses in 2001. “We’re violating the brand we established 10 years ago,” said Davidson Mayor John Woods.

Looking ahead, there’s a decent possibility the MTC will go to voters in coming years for new taxes or other public revenue. It would be even harder for the MTC to ask for new public revenue if it were still rejecting a revenue stream that many in the public consider low-hanging fruit to be plucked.
Photo: Get ready for more advertising on CATS buses, such as this on promoting Charlotte Motor Speedway’s October races. Credit: Charlotte Observer file photo

‘Differences of opinion’ on transit plans

TRYON, N.C. – After the lunch break at the City Council retreat (great blackberry cobbler! – and yes, the Observer journalists pay for their own lunch) talk has turned to transportation.

Hard to blog and take notes and listen simultaneously, but lotta talk about concern in North Meck and on the MTC about whether the North transit line should have been built ahead of the NE line and the streetcar. Of course, no MTC money is being used to build the city’s streetcar project, but, as City Manager Curt Walton said, at the recent Metropolitan Transit Commission meeting, city officials showed CATS data to prove that no CATS/MTC money going to the streetcar, “But they didn’t believe it.” He also cited what he said was “a legitimate difference of opinion” about whether the Northeast line or the North line should be moving forward next.

What Walton didn’t say, but that savvy transit officials would, is that the Bush administration’s rules on how to rate transit projects’ cost-efficiency meant the North corridor did not qualify for any federal money, and the NE corridor just squeaked in by the skin of its teeth. If someone is to be bludgeoned about why the North corridor is not being built, folks might want to be looking toward the Federal Transit Administration and the previous administration. ( Note: The Obama administration has announced that it’s changing those rules on how to rate transit projects.)

And CDOT director Danny Pleasant just now made that point, as I was typing the above. Neither the North Corridor nor the streetcar qualified for fed transit funds under the old rules. But things are changing.

Blue Line or Green Line?

Should the existing Blue Line be renamed the Green Line, to please UNCC? Tomorrow the Metropolitan Transit Commission takes up the discussion at its 5:30 p.m. meeting. Here’s a link to the meeting agenda.

At first, it sounds like an easy and simple decision: The transit line that’s planned to run from uptown to UNC Charlotte should be the Green Line, to reflect the 49ers school colors.

But with transit – and transportation in general – things are rarely as simple as you’d think. Here’s the biggest sticking point: The new line will be a continuation of the existing Blue Line. That is, you could hop on at I-485 outside Pineville and ride all the way to beyond UNCC.

There’s already been significant investment in “Blue.” Even the train cars are blue, not to mention the signs, etc.

As CATS officials note, they couldn’t find any other transit system that “changed colors midstream” (hmmm, interesting turn of phrase). It might well confuse riders. I mean, we’re not talking a lot of riders here with New York-caliber subway expertise (where one line simultaneously might have two numbers or letters or colors, and you have to notice whether you’re hopping on a local or an express route, for instance). Starting on the blue line and ending on the green line might be as confusing as starting out on Woodlawn and, without turning, finding yourself on Runnymede and then Sharon Road then Wendover, and then Eastway. Or maybe Tyvola to Fairview to Sardis to Rama. Or … well, I could go on but I won’t.

Hmmm. Now that I think about it, a Blue-to-Green Line transit corridor fits right in. How very Charlotte.