Urban rail failed in Portland and Austin faces same fate

COST Commentary: The note below was originally sent to elected officials and other key individuals in the Austin region. It was published in the Austin Business Journal (ABJ) with a few minor modifications here to accommodate this format.

This note was motivated by a recent study by the City of Austin and the University of Texas which has been presented by many as support for rail based on the reported findings of major tax increases resulting from urban rail implementation. There is clearly some confusion here as the Statesman reported the City representative stated: “We deliberately did not try to make the connection that you need urban rail to attract growth,” Johns said to the council. “What we are saying is if you develop the urban growth, it will be channeled to this area because people will see they can save an $8,000 bump in their salary.”

The stated savings are not real savings but are a deceptive estimate of the cost to the rider of using transit instead of a car. It does not consider the real costs of transit which are overwhelming borne by taxpayers who are not riders and receive no measurable benefit. This estimate is also totally without consideration of the destination limits of transit, the excessive time for transit trips, the better jobs and higher salaries one achieves with private vehicles, the ability to better access affordable homes, lower cost goods, better medical care, better education and all of life’s offerings with private vehicles. This all leads to greatly enhanced quality of life through the cost-effective, flexible and broad reaching mobility of private vehicles versus the extreme limitations of transit.

The City study also does not consider the negative impact and additional burden which urban rail places on low income citizens who are dependent on transit and have no alternative. The wasteful spending of tax dollars on ineffective transit, such as urban rail, which is not cost effective, increases fares and reduces overall bus transit service making a mockery of social equity.

An important question is why did the city spend $3.7 million taxpayer dollars to provide questionable information which is of no value to anyone except those who wish to deceive and manipulate the public regarding the merits of urban rail.

The title of the article below was by ABJ and is very descriptive.

Urban rail failed in Portland and Austin faces same fate

by Jim Skaggs, Guest Contributor, September 6, 2013

The recently reported Austin study indicating huge tax revenue increases due to the economic impact of rail transit is a total fabrication without foundation.

Portland was an early implementer of modern urban rail in the l980’s. Leaders there promoted and projected major tax revenue benefits from economic development near train stations. This did not happen.

Many years, many cities, of urban rail failures to improve congestion and air quality have been generally accepted and many supporters have again turned to the more subjective ‘economic development’ “carrot” to lead rail promotion.

This site reveals some of the “reality” regarding rail transit’s negative impact on tax revenues in the city of Portland, “Mecca” of rail transit. The bottom line is: City tax incentives were eventually necessary to entice developments near train stations, resulting in reduced general fund, tax revenues. These tax incentives coupled with subsidizing of exorbitantly expensive rail transit results in significantly higher taxes for all citizens and degradation of basic city services.

The current Austin so-called “study” of rail’s economic impact is simply not valid based on substantial experience in many cities. If this study was knowingly incorrect, it is tragic. If it is a mistake, it reflects gross incompetence. The “study” was not objective and seems to be supporting pre-determined decisions and self-serving motivations without adequate checks and balances to provide the quality it deserves.

The city of Austin seems to have forgotten it paid for a study by Heimsath about 7 years ago which concluded the city could expect zero, net new property tax dollars from urban rail. See:

COST spent significant funds for a third-party expert, outside Austin, to reveal Heimsath’s true conclusions which were disguised by a poorly written report and misrepresented throughout the city as support for rail’s creation of additional property taxes. After COST’s revelation, the city stopped talking about the study. Heimsath’s conclusion that rail is a “zero sum game” regarding property taxes was far more accurate than the recent study’s projection of major tax revenue increases.

I urge the city to implement and maintain quality control of a process which will assure misleading distortions are not used in attempts to manipulate citizens and achieve objectives such as urban rail. This may be the most important decision in Austin’s history. Total objectivity and full transparency have never been more important to avoid the potential, broad reaching, negative impacts on all citizens for several generations.

The COST site contains many articles and commentaries regarding this and many other transportation subjects. Click on ‘News Articles’ and browse the many titles, especially more recent ones.

Jim Skaggs is director of the Coalition of Sustainable Transportation and the former CEO of Tracor.

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