Capital Funding
Sample Streetcar System Costs and Benefits
The below table shows summaries of capital costs and in
some cases identified benefits for modern and heritage streetcar systems:
Potential Sources of Capital Funding for Streetcar Lines
FTA New Starts
Portland’s heritage cars and maintenance
facility were paid for by 80% UMTA funding as part of the Banfield Light Rail
project. New starts money is one of the best potential sources of capital
funding, however resources are limited and many cities are competing to receive
such funding for light rail, commuter rail, bus rapid transit, or other transit
projects.
FTA Small Starts
The reauthorization of the highway bill (TEA-LU) enacted by
Congress in 2005 introduced a new source of funding for streetcar projects
referred to as "Small Starts." Inspired by the success of the Portland Streetcar
and other downtown heritage or new streetcar systems, the program is aimed at
smaller projects than traditional regional light rail projects and includes
economic redevelopment as a means of justifying such projects. The following
link is to a PDF version of a presentation introducing the Small Starts program
given by Jeff Boothe of the Community Streetcar Coalitioni at the APTA Heritage
Trolley and Streetcar Subcommittee meeting in Dallas in September, 2005:
Transportation Enhancement funding
Some of the Federal Highway/Transit funding legislation has included what became known as Transportation Enhancement Funding. This funding could cover historic preservation or other projects not directly related to the large scale highway/transit funding normally covered by the legislation. The availability of this funding varies with each reauthorization. However, the Dallas heritage trolley operation
received grants of $5.5 million in 1994 from this source. (See
The Streetcar Renaissance in Dallas)
Build track and wire at same time other infrastructure work being done
(street reconstruction, sewers, other buried utilities)
In Dallas voters passed a bond bill to
finance street improvements along the proposed extension of the heritage trolley
line, and officials planned to build track as part of the project. (See
The Streetcar Renaissance in Dallas) In Washington, DC and Charlotte streetcar track was included as part of major street reconstruction projects before a complete program to introduce streetcars was formulated or funded.
Sale of naming rights to stations, cars
Used in Tampa (for an operating
endowment—see Tampa Project Description) and Portland (See
Portland’s New/Old Trolleys)
Municipal assessments on developers
As developers stand to reap financial
benefits from a streetcar or heritage trolley system, a city government may opt to require a
contribution toward the system in return for the right to
develop along the line.
Voluntary investment by developers of parcels along line
In Dallas, developers of Cityplace
contributed $1 million toward extension of the heritage trolley line to serve
their complex (See
The Streetcar Renaissance in Dallas)
Development of adjacent land
Conceivably the organization building a
streetcar line could be given the right to develop parcels along the
line, using profits to help pay for the line.
Foundation grants
In Galveston, the local match for federal
funding used to build the heritage line was contributed by two foundations, one
of which later funded the entire cost of an extension of the line. (See
Heritage Trolleys in Memphis and Galveston).
Park funding – if line passes through park
If a streetcar line passes through a
national or state park, funding from park service sources may be available to
help with the line. This approach is being pursued in Lowell (MA), where the
National Park Service owns the current heritage trolley line, and may be pursued
in San Francisco, where proposed a heritage trolley extension would pass through
another national park.
Hotel/motel tax
In New Orleans, part of the 20% local
funding to match FTA new starts money for reintroduction of streetcars to Canal
Street came from extending a local sales tax to the hospitality industry. The
hotel and motel operators supported the measure as they felt the streetcar line
would be an added tourist draw, as has been the case with the other two streetcar lines in New
Orleans.
Donations from private sources
One quarter of the $6 million cost of the
New Orleans Riverfront line opened in 1988 came from private sources. (See
New Orleans Prepares for the Past)
In Portland (OR) heritage trolley service
along the downtown portion of the light rail line was funded initially by
business taxes, business sponsorships, and other private monies, plus farebox
revenues. This included interest from a city trust fund established in the
middle of the 1980s through a Local Improvement District tax of businesses along
the route. Four businesses have already agreed to be “car sponsors” by paying
$100,000 each ($20,000 a year over a course of five years) for the right to
advertise (or sell advertising) on and inside their designated car. In addition,
eight other businesses have made donations of $30,000 each as “station sponsors”
in exchange for recognition in Vintage Trolley literature and in signage at
stops along the route.(See
Portland’s New/Old Trolleys)
Donations for local match
Private sources may provide contributions in
kind rather than cash contributions. In New Orleans, an oil industry firm
donated oil pipe worth more than $1 million to be used as overhead wire support
poles on the Canal Street route. This donation counted as part of the local
match to FTA funding.
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