Carolina Journal News Reports
CHARLOTTE — When the Federal Transit Administration released its proposed fiscal 2005 budget in February, there were plenty of disappointed transit supporters in both the Triangle and Charlotte. Rather than committing to pick up half the tab for new rail transit systems in the two communities, the FTA’s upcoming budget recommended providing only limited funding for the systems.
Though the two authorities may well get the funding they sought in the future, the coming year’s limited authorization makes it likely that the completion date for the routes will slip. The Charlotte route was to open in 2006, the Triangle line a year later.
An examination of the FTA’s yearly reports on possible new projects reveals the weaknesses of both projects. The Charlotte Area Transit System and Triangle Transit Authority’s proposals both rated poorly in cost-effectiveness, a key funding criteria. Large capital investments would be required in systems that will carry only a relatively small number of people.
To make matters worse, both CATS’ and the TTA’s proposals have seen substantial changes, large cost increases and fluctuating ridership estimates over the last three years, further calling into question the systems’ viability.
Charlotte’s transit vision involves creating five transit corridors by 2025. The envisioned lines would run from uptown Charlotte to the towns in northern Mecklenburg County; along Independence Boulevard toward Matthews; to UNC-Charlotte; to Charlotte Douglas International Airport; and toward Pineville.
When voters approved an additional 1/2-cent sales tax in Mecklenbug County to help pay for it, the system was described in 1998 as a $1 billion project. The overall cost has grown considerably since then — it now exceeds $3 billion and continues to escalate. Perhaps this should come as no surprise, as all that was certain in 1998 was that there would be five transit corridors running out from the center of Charlotte. The exact routes, the number and location of stops, and even the choice of rail or bus serve for each corridor was not specified when voters approved the transit tax.
CATS is currently seeking federal money to help build the first of these lines, the South Corridor light rail line that would run from uptown Charlotte to Pineville. The line’s financial backing and land-use planning scored well with FTA. More problematic, however, is the route’s cost-effectiveness.
The FTA measures cost-effectiveness using a measure called “incremental cost per incremental hour of transportation system user benefit.” The figure for the south Charlotte line is $23.84, which earns a “low-medium” rating from the FTA. Low-medium is second worst of the FTA’s five ranking categories. A cost-effectiveness measure of $25 or above would get a “low” rating and substantially reduce the chance of a project getting federal funding.
At its core, cost-effectiveness measures a system’s costs and its usage (ridership). CATS has seen substantial changes in both figures since the line was first proposed six years ago. In 1998, the south corridor was projected to cost $277 million. By late 2001, the figure had increased to $348.2 million for a 11.2-mile line.
In 2002, CATS made a major change to the route. Pineville requested that the line stop short of the town.
“They would want about 5,000 people living within a half-mile of a station,” Pineville Mayor George Fowler said to The Charlotte Observer at the time. “We’re only a town of 3,500, and that would have made such a huge impact on the town.”
As a result, CATS changed the end point for the line, eliminating a station, a bridge over Interstate 485, and reducing the line’s length by 1.6 miles to 9.6 miles. Despite these changes, estimated costs actually increased to $370.8 million as the projected cost of other elements increased. The November 2003 cost estimate was $385.9 million.
The FTA’s 2003 analysis of CATS’s proposal found potential problem with both CATS’ cost and ridership projections. On the cost side, the FTA noted CATS aggressive construction schedule, with completion of the line scheduled for within two years of receiving the requested federal funding. “FTA further notes that the project schedule is very aggressive and that capital costs are likely to change if the schedule slips” the report said.
On the ridership side, “FTA notes that CATS’ forecast of new riders and user benefits reflects a significant share of induced non-home-based trips. This is a market that traditional travel forecasting procedures have not typically addressed; as such, the project’s travel forecasts and subsequent estimate of cost effectiveness entail some risk.”
CATS ridership projections have been inconsistent over the past three years. In 2001, it thought the line would draw an average of 21,110 riders on an average weekday in 2025 with 14,200 of these being new transit users. Despite chopping the length of the line, CATS’ ridership projections for 2025 actually increased the following year to 25,700. Strangely, the projected number of new transit users fell to 8,600.
The most recent projections, reported in the FTA’s November 2003 new starts assessment, shows the line drawing only 17,900 riders on a weekday in 2025. Of these, 7,000 would be new to transit. Opening-year ridership was estimated at an average of 9,100 per weekday, down from 12,880 projected only a year earlier.
The TTA’s proposed 35-mile Durham-to-Raleigh diesel multiple-unit rail system shares many of the strengths — and weaknesses — of the south Charlotte line. As in Charlotte, the financial and land-use planning aspects of the TTA’s proposal were well-regarded by the FTA. The TTA’s primary weakness was, again like Charlotte, cost-effectiveness. Its incremental cost per-incremental-hour-of benefit measure was $24.48, slightly worse than in Charlotte and rated as “medium-low” by the FTA.
To barely achieve even that rating, the TTA had to make major changes to its proposed system last year. The system will buy fewer trains, construct a smaller rail yard, and build a less-complex rail net. Total track length was also shortened slightly, with the end station in north Raleigh being relocated. The new site allows the system to avoid building several bridges.
Despite more than $40 million in cuts, the TTA’s total cost estimate still increased from 2002 ($832.2 million) to 2003 ($843.3 million). The November 2001 cost estimate was $754.8 million.
The latest figures from the TTA also show a marked decrease in projected ridership compared to earlier estimates. In November 2001, the system projected the line would average 31,700 weekday boardings in 2025, including 11,600 new transit users. By late 2002, the 2025 projections increased to 36,200 weekday riders, including 15,400 new transit users. Last November however, it projected only 25,200 riders in 2025 with 8,300 new to transit.
Even these usage estimates might be overstated demand. The FTA notes in its November 2003 assessment that the system uses very optimistic farebox revenue assumptions in its operating projections.
Michael Lowrey is associate editor of Carolina Journal.