Let’s see: 100 percent cost overrun? Check.
Anemic ridership? Check.
Requires tax breaks, tax-increment financing, and other “public investments” to stimulate transit-oriented development? Check.
Declared a great success by the transit agency desperate for tax increases to fund further rail projects? Check.
Must be light rail.
As Wikipedia points out, when planned in 2000, Charlotte’s light-rail line was supposed to cost $225 million. The final cost turned out to be $467 million. Even after adjusting for inflation, that’s close to a 100 percent cost overrun. (Actually, considering inflation from 2000 to 2007, that’s about a 75 percent cost overrun.)
In 2008, the Charlotte Area Transit System (CATS) reported less than 12,000 average weekday trips on its light-rail line. The Houston and Hudson-Bergen light-rail lines, both about the same length, each carried more than 40,000 weekday riders (and can hardly be considered successes).
Given the high capital costs plus nearly $10 million in annual operating costs, the annualized cost of Charlotte’s light-rail works out to more than $3.60 per passenger mile (compared with less than $1 for a typical bus and less than $0.25 for driving, including highway subsidies which, in North Carolina, average less than half a penny per passenger mile). Of course, most of that $3.60 is subsidized; transit users paid an average of just $0.12 per passenger mile to ride it, leaving a subsidy of nearly $3.50 per passenger mile. That also works out to a subsidy of more than $20 per ride, making Charlotte more expensive than almost any light-rail system outside of Buffalo and San Jose.
Tax-increment financing was only legalized in North Carolina in 2005, but Charlotte is using it to the hilt, expecting it to help pay for both future rail lines as well as transit-oriented developments. The city has also waived property taxes on some residences in these development for 5 or more years.
Despite the high costs and trivial ridership, CATS wants more rail — but doesn’t have any money to pay for it. So it has rolled out a campaign of declaring the light rail a great success, especially in the field of economic development. Of course, in most cases it was the subsidies, not the rail, that stimulated the development, and most likely the development would have taken place somewhere in the region anyway, though perhaps not in that corridor.
So the taxpayers are out $467 million in construction costs, millions more to operate the thing, and millions more to support development that would have taken place anyway. What a great success!