Mass Transit Mess: Central Planners Hard at Work in Rhode Island

Drumroll, please – time for another central economic planning moment:

Planners for the city and the Rhode Island Public Transit Authority have laid out the route for a $126-million streetcar system through the city’s core and proposed an unusual method to help pay for it. The two-mile-long system would link the city’s hospital complex, College Hill and Kennedy Plaza, and its newest economic-development project, the “Knowledge District” that officials are trying to create south of Johnson & Wales University. It would also, the planners say, generate millions of square feet of development and thousands of jobs. … The planners are about to unveil [the plan] to government agencies, the governor, leaders of the General Assemblyand the Federal Transit Administration, which would have to endorse it.

Statists love mass transit. It is big, so it fits many bureaucrats; it is complex, so they can have many meetings and talk a lot; and – most important of all, of course – it involves micro-managing people’s lives:

The planners looked at a variety of possible destinations, from Olneyville Square to Wayland Square. The destination that prompted the most debate, Pettine said, was the Providence train station. The station, where about 70 Amtrak and commuter trains stop daily, isn’t included. Pettine said that including both College Hill and the train station just wouldn’t work. Besides, she said, it takes less than 10 minutes to walk from the station to Kennedy Plaza.

Except for when the Nor’Easter snow storms bear down on Providence, or the Atlantic pummels the Ocean State with November rain, or when it is 90F and summer’s humidity makes you sweat just by breathing. You know, those days when you go straight to your own car and get home safe, warm, cool, dry and can run some errands on the way. Like picking up the kids or getting groceries.

The project would create an estimated 6,000 jobs and substantially expand the city’s tax base by attracting 4 million square feet of new development, the study says. The project would cost about $6.5 million per year to operate, including debt service on money borrowed for construction. The construction cost is about double that of the Wickford railroad station, $56 million, and half that of the Warwick train-airport Interlink, $267 million. More than half of the construction costs would be covered by federal funds, along with state capital funds (10 percent) and borrowing (32 percent). Fares would be $1. For much of its operating money, however, the system would depend on a new tax district along the route, with assessments levied on benefiting property owners, 95 cents per $1,000 in assessed valuation within one-eighth of a mile of the route, and 55 cents per $1,000 within a quarter of a mile.

Of course, it would be asking too much of these central planners to take a peek at the finances of mass transit systems elsewhere in the country: recently Governor Kasich in Ohio has pulled the plug on a mass transit system in Cincinnati because he did not believe it was financially sustainable; and the new mass transit plan for Atlanta is also looking to become a nightmare for taxpayers.

Another question that the central planners are not willing to discuss is: who will determine what businesses benefit from mass transit? Even if a business owner is having more customers, how will the government determine whether or not that is because of the lightrail system? How do you know that improved business is not the result of better economic times – not to mention the business owner’s own hard work? 

Why not stick with the buses RIPTA already operates? Streetcar supporters say that, although buses provide a similar service, it takes the permanence of rails to reassure developers that a transit line won’t move away from their investment.

That’s their argument?? If businesses needed reassurance of permanent commitments like rails in the street, there would not be any businesses in Providence in the first place.

This mass transit system is almost by definition going to become a permanent burden on the shoulders of Rhode Island taxpayers. Whatever minimal benefits some businesses may get from being located right where a lightrail stop is, will be gobbled up by the new taxes. It is worth noticing that the government planners have already determined that all businesses within a quarter mile of a rail line will see their revenues go up by 5.5 to 9.5 percent per year – provided the government-assessed value of their property does not go up. And if government (by mere coincidence of course) happens to assess the properties at a higher value, not only will the mass transit tax burden go up, but so will property taxes. And then business owners will have to worry about paying more costly health benefits for employees that come with Obamacare, plus wealth-punishing federal income taxes.

Providence has already resorted to cutting law enforcement – the very core of essential government functions – just to stay afloat and avoid the financial disaster experienced by another Rhode Island city. A lightrail system on top of all this would take the city from bad to worse and force even more businesses to shut the doors. As of February 2011 Rhode Island had lost over 30,000 private jobs since the last peak of the business cycle. The Ocean State’s recovery is slow; every new wrench that government throws into the machinery of private business will only make matters worse.