Denver FasTracks: New Sales Tax or Delayed Lines

Denver FasTracks, facing huge budget deficit, may see new dedicated funding streamDenver FasTracks Map

Denver’s RTD is currently pursuing one of the most ambitious transit expansion programs in the country: FasTracks, which will add 119 miles of light rail (three lines), commuter rail (three lines), and bus rapid transit (one line), all centering around downtown’s Union Station. FasTracks is being sponsored by a region-wide sales tax as well as federal new start program dollars. Just last month, RTD was awarded $308 million from the federal government for the 12.1-mile West Corridor LRT line to be built between downtown and Jefferson County.

But escalating construction costs and declining revenue are putting the program’s completion in danger. The project’s originally price tag – projected in 2004 – was $4.7 billion, but that number has now zoomed up to $7.9 billion, and sales tax revenues have declined with the suffering economy. The Rocky Mountain News reported last week that RTD is now projecting that it will be $2.1 billion short of its total needs by the project’s end date, which means that either the transit agency will have to delay some of the projects (to 2034!) or cancel some of the lines entirely.

And yet RTD may have an alternative: finding another funding source. A poll taken by the agency suggests that 63% of Denver-area citizens would support a sales tax hike of up to 0.4% (4¢ for a $10 purchase) in order to ensure the completion of the entire project. Now RTD is considering whether to place a referendum on the ballot in the eight-county transit area this fall or next, hoping to convince citizens of the need for more money to pay for transit.

The good news for RTD is that 77% of people in the metro have positive impressions of the program, while only 19% think of it negatively. The bad news is that the worsening economy may make it difficult for RTD to get the support of anxious voters.

At this point, RTD – like many transit agencies around the country – has no choice but to ask voters to pay more to support it. Ultimately, communities that choose to invest in large transit expansions have no real recourse but asking their own citizens to pay more of the cost – which seems “fair,” at least in a national context in which the vast majority of communities are not investing in transit expansion. In the long term, it would probably make more sense to allow communities to divert highway funds to transit investment, but for now, the best alternative is local taxation.

Fortunately for cities like Denver (and Charlotte, Dallas, Houston…), the people seem happy to vote to pay a small sales tax to support such projects. One wonders, then, why more communities don’t propose referenda to pay for transit expansion?

Images above: RTD LRT Train and FasTracks 2017 Map, from RTD

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