Charlotte’s Once Ambitious Rapid Transit Plan Faces Budget Ax

» A significant decline in local sales tax revenue means that long-term plans for transit expansion have had to be reevaluated with an eye towards fiscal reality.

Ridership on Charlotte’s transit system has grown substantially over the past ten years, increasing from an average of 39,100 daily users in 2000 to 103,500 in 2010. This successful ramp-up in public transportation use in one of the nation’s most sprawling regions can be traced to the 1998 passage by voters of a 1/2-cent sales tax for transportation funding; this measure allowed the local transit authority CATS to significantly expand the number and frequency of bus services offered, and construct North Carolina’s first light rail line, which opened in 2007.

That Blue Line was supposed to be joined by a network of six other corridors — light rail, commuter rail, streetcar, or bus rapid transit — radiating from Center City Charlotte. The Metropolitan Transit Commission’s 2030 plan estimated that tax receipts would provide enough funding to complete most of the projects by 2020, with everything in operation by the end of the time period.

The recession, however, has hit Charlotte hard. Most significantly, its biggest employer, Wachovia Bank, was threatened with bankruptcy and eventually bought up by San Francisco-based Wells Fargo. Consumer spending, like in many cities, declined massively. In 2008, revenues collected using the transit sales tax amounted to $71 million; two years later, the total had fallen to $57.4 million. This fall-off, which is expected to produce a total revenue shortfall of up to $1 billion by 2030, has forced the region to reconsider its plans for transit expansion.

In the process, the Charlotte metropolitan area is threatening to derail the positive momentum it has created for transit ridership. And its strategy to connect the whole region via radial lines from downtown is on the skids at least for the next decade, since no one seems prepared to raise taxes to complete the project. This reality is likely to encourage the sentiment that the transit system is only designed to serve some parts of the region, not everywhere.

This week, the Metropolitan Transit Commission, which oversees CATS at a countywide level, made the decision to effectively put two projects on hold indefinitely, including the Silver Line bus rapid transit corridor from Center City to Matthews and the Green Line streetcar from Eastland Mall to Rosa Parks Place and the Airport, via downtown. The two remaining projects — an 11-mile extension of the Blue Line light rail corridor to UNC-Charlotte and the 25-mile Red Line commuter rail from Center City to Mt. Mourne — remain on the books, albeit in underfunded forms. Plans for local bus service expansion will be canceled.

CATS is looking to cut $200 million from the $1.1 billion budget of the Blue Line extension, which is expected to see significant aid from Washington in the form of a New Start grant. If it does, the project could be under construction next year, with an opening in 2016. But the transit agency will have to reduce construction costs for that to happen: In the process, the line’s length may be cut, the number of stations may be reduced, and amenities along the line will have to be minimized.

For the $456 million Red Line, no such federal help is expected because of the limited ridership projected for the corridor. But the region only has 57% of the costs accounted for, so it is now hoping to develop a public-private partnership to ensure completion by 2018. That may be a futile approach, but the corridor remains in the discussion because it would serve several cities outside of Charlotte on its way north; because the Metropolitan Transit Commission’s board is constituted of mayoral representatives of many towns, not just the much-larger City of Charlotte, it has an incentive to promote a project that would serve them as well. Thus its relatively low projected ridership is the price to be paid for regional compromise.

But the 13.5-mile Silver Line has been less lucky, despite the fact that it would terminate in the suburban town of Matthews. Part of the reason is that it has for years been a source of controversy for inhabitants of the southeast sections of the region, who fail to understand why they will receive a bus rapid transit line while the rest of the area gets rail. Yet they will now have to wait much longer for any transit improvement at all.

Meanwhile, the Green Line — a priority of Charlotte proper but relatively unpopular at the regional level because of its lack of connections outside of the core city — is in a peculiar place because its first segment is currently under construction, with service expected to start in the next two years. A $47 million, 1.5-mile stretch between the Blue Line stop at the Charlotte Transportation Center bus terminal and the Presbyterian Hospital southeast of downtown was partially funded by the federal government’s Urban Circulator program earlier this year. But its 10-mile total length, not including the long-off airport link, would cost $500 million, too much for the region to afford. This means that a rail transit link downtown between the Red and Blue Lines simply will not be built.

The end result: The expansion plan, developed just four years ago, now seems more like fantasy than reality. Nothing other than the Blue Line extension is likely to be built unless there is political will to push for a tax increase for the program or a private partner is willing to drop hundreds of millions of dollars on a project, and neither of these seem like particularly realistic prospects.

The question is whether this situation will disrupt the delicate regional structure that Charlotte relies upon to fund its transportation program. The Blue Line extension and the under-construction segment of the Green Line will serve the city exclusively. If financing for the Red and Silver Lines cannot be obtained, will the towns at their proposed termini fight to remove themselves from having to pay the transit sales tax, citing lack of a return on their investment? Will the citizens of the cities involved, who reaffirmed the tax in 2007, claim that they were sold a bigger bill of goods than could ever be expected to be completed? These prospects, which would reduce funds even further, should encourage the region to work like mad to develop alternative financing systems to complete the entire 2030 plan.