Washington, DC

April 2012

Operating Shortfall Predicted

The Washington Examiner reports that the first two lines of Washington's planned streetcar system will only recover 58 percent of the estimated $64.5 million in operating expenses over the first five years of operation. Income will include fares, advertizing, federal grants, and District funds.

To cover the remaining 42 percent of the operating costs city officials suggested possible sources including special property tax districts along the lines, increased tax assessments along the lines (which should boost property values), increasing citywide sales tax, and parking revenue.

The city's buses only cover 27 percent of their operating expenses, while Metrorail covers 82 percent of its cost from fares.

Mayor Vincent Gray says the city budget can cover the first three months of operating costs for the H Street/Benning Road route when it starts service in July 2013. A way of covering expenses after the initial period must still be devised.

A study released some months ago predicted that the full 37-mile proposed streetcar system would increase property values by 5 to 12 percent, and would also lead to property development of up to $8 billion over the next decade.

Streetcar Contract Awarded

An order for two additional streetcars for Washington's new streetcar system has been awarded to United Streetcar, a subsidiary of Oregon Iron Works in Clackamas, Oregon. The cars will closely resemble the three streetcars on hand, provided by Czech manufacturer Inekon.

An earlier order for two cars placed with United Streetcar was cancelled when Inekon challenged the award to the less-experienced Oregon firm.

Washington officials say that the five cars will allow service to be started on H Street and Benning Road.