Denver Pols Reject Plan to Increase Transit Sales Tax, Put FasTracks Expansion Program in Doubt

» Seeing little hope in approval from electorate this year, regional board delays vote despite difficult fiscal situation.

Once seen as the American leader in transit expansion thanks to the approval of a dedicated tax in 2004, Denver has been hit hard by the recession, putting in question its ambitious rail construction plans. Thanks to a significant decrease in sales tax returns, the region does not have the funds to complete the eleven projects it had planned for 2017. Yesterday, the RTD transit agency’s board decided not to ask the region’s voters for another increase, virtually ensuring that the program will not be finished on time.

The agency board’s unanimous decision was predicated on the idea that the weak economy would make it difficult for voters to agree to paying more in taxes in an initiative this fall. Because next year is an election off-year, 2012 is likely the next feasible date for a vote on increasing sales taxes from 0.4% today to 0.8%, enough to keep the FasTracks expansion program in the black.

Though Denver’s West Corridor is currently under construction, and the East and Gold Lines are funded, current tax revenues indicates that the full spate of projects will not be completed by 2042 unless a new funding source is identified. The Union Station renovation — the central element of the transit improvement scheme — will move forward as per necessity.

Denver leaders have known about the lack of adequate funds since early 2009, but have done little to build a political coalition in favor of a tax increase. With fewer funds, lines will be significantly delayed and short segments of planned corridors will be built in phases.

If this situation was predictable, it is not unique to Denver: most American cities have experienced exceptional decreases in local tax revenues, putting projects of all sorts in difficulty. But this city’s leaders have failed to take advantage of the potential popularity of transit projects to argue for the need to expand and the necessity of increasing taxes to do so.

As St. Louis voters demonstrated clearly last week, there is a strong public interest in paying for better transportation solutions, even if it means handing the government a bit more in taxes. By mounting a campaign for transit investment based on a demonstration of the public sector’s competence, a call for support from political and business leaders, and an affirmation of the value of public transportation in getting people around, St. Louis reversed a defeat at the polls in 2008 with an overwhelming win for transportation. St. Louis will now not only restore bus and rail operations reduced over the past year, but also begin planning work on a new rapid transit corridor.

All this despite posturing by anti-tax advocates and a harsh political environment that makes discussing the value of the public sector a difficult proposition.

Denver could learn a lesson or two from its Midwestern peer: A bad economy does not improve anyone’s mobility, nor does it eliminate voter hopes for the future of their region. Deciding not to hold a vote this year amounts to giving up on FasTracks’ quick completion without even trying to save it.

14 Comments | Leave a Reply »
  • Freddie

    The problem is nobody trusts RTD. Their revenue shortfall is not due to the recession, they’ve been below projections almost since the program went forward. You almost have to say they “lied” about how much revenue the original tax would bring. They were projecting revenue growth of 6.2% over 30 years which is crazy. Now they blame the recession.

    Also, the last head of RTD got something like 3 million in compensation, no oversight from the board of directors. They have no credibility. That’s why they can’t get a tax increase. Fool me once . . .

    Finally, some of those lines are stupid. The 40 something mile lin NW corridor will carry, by RTDs own projections, something like 8000 passengers a day and cost around a billion dollars. How does that make sense.

  • Tom West

    If revenue from the 0.4% sales tax continues at its current rate, how long will it take to build the system? Are we talking 2020 (rather than 2017 with 0.8%) or 2025 or 2030?

  • Matt Eric

    They will almost certainly ask for the tax increase in the 2012 election. If they get it then, the final completion date of fastracks will only be pushed out two years (from 2017 to 2019). This is probably the correct decision given the current political climate; if they asked for a tax increase this year and it failed, they would almost certainly have a much tougher time asking for the same thing two years down the road. Furthermore, much of the project already has funding identifed, and will be moving forward with construction later this year. When they ask for the tax increase in the 2012 election, they will have a much easier time getting it when 1) they’re not facing the situation where they already asked and it was rejected, and 2) there are multiple lines either nearing completion or well under construction.

    As an aside, I honestly think they probably could have gotten a tax increase this year, even in this political climate. But there’s a good chance they couldn’t have, and pushing it back to take advantage of a potentially more favorable political climate isn’t in any way a “disaster” for transit in Denver.

    One interesting thing about RTDs projections; their ridership projections are also historically inaccurate, but by massively underestimating ridership. People tend to flock to the light rail lines once they’re built and going somewhere useful. And we’re going to need some way to get around once gas shoots up past five bucks a gallon.

  • David Jones

    The map is wrong. The Gold Line is NOT LRT, its EMU and will be built by PPP that will build and operate the East line to the airport, so they will use the same technology.

  • There is an interesting difference here as well. Proposition A 2010 marks the first dedicated local source of revenue for transit operations (the 1974 transportation tax also goes towards county roads, the 1994 tax is split for the local match to federal capital funding).

    I do believe that many people had many reasons for supporting the tax, but the fact that Metro would have to cut service and routes, rather than halt construction of new lines, definitely made a difference for some people. But many people also voted for the expansion component. The additional funding for Metro is intended for a slower, steady expansion of service over time. A project the size and scope of FasTracks, however, would need additional funding sources.

  • poncho

    wait until a few new lines open amid glowing publicity and massive crowds then shortly thereafter have the referendum.

    it all depends on the publicity if people keep reading about cost overruns and construction problems and delays theyll turn on it. this happens with any large scale multi-line transit expansion, just look to LA 10-12 years ago, voters lost faith in the MTA and smothered them with restrictions that are only now beginning to be overturned. if people have lost faith in RTD and fastracks then this was a smart move.

  • Eric G.

    Who came up with the ridiculous idea to have two different technologies serve the north and south halves of the region? It seems like the US-36 BRT could be ditched since it largely mirrors the NW corridor. The North and NW corridors could be shortened and built as LRT (allowing routing through downtown to destinations south). BRT could extend the lines on the top 1/2 of the North and between Boulder and Longmont. That would save some cost, standardize equipment needs and present the voters with some proof that there was a reevaluation in light of circumstance and an attempt craft a better, more affordable plan. They should also add a few “rapid bus” (sub-BRT) lines to the map to make the overall program more robust and quicker to deliver benefits. You can do these simple speed improvements like off-board payment, stations and longer stop spacing for $2m/mile. Perhaps a graduated rise in the tax would be an easier sell. Raise it only to .5 now while we are coming out of recession, and then step up to .8 as the economy gains speed. I like Denver and have really enjoyed the system they have when visiting. I hope they can keep building it…

    • Geoff

      Eric G,

      The decision to use different technology for some regions was base on 2 factors
      1) For the most part the corridors slated to use larger commuter rail trains operate in mixed freight traffic in existing freight corridors. The FRA prohibits light rail in these corridors.
      2) Many of these corridors (with the notable exception of Gold) are longer with longer spacing between stops. The corridors with light rail have much shorter spacing between stops. RTD did do the analysis for light rail vs commuter rail for the east corridor (the only one which would not have been prohibited from using light rail because of reason 1 and found that commuter rail had faster travel times.

  • JP

    This seems like another project which could benefit from a national infrastructure bank.

  • Nathanael

    At least RTD is prioritizing correctly. The North Metro and Boulder/Longmont lines are predicted to be the worst performing of the lines; and the two southern extensions appear to be very expensive to construct. The I-225 line is really the next priority, but it’s also very expensive to construct, due to some poor urban planning. At least *future* development is supposed to match up with the I-225 planned route.

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