The Damage Done by Federal Funding

Despite the fact that the Trump administration has said that will not sign more full-funding grant agreements for streetcar and light-rail projects, and there are no grant agreements for a Ft. Lauderdale streetcar, someone in the Department of Transportation gave Ft. Lauderdale nearly $61 million for the city’s inane streetcar project. When I asked DC transportation experts about it, the only answer I could get is that the department was “forced” to do so.

So now it is absolutely clear that transit capital grants are given out solely for political purposes, not because they make any economic or transportation sense. While the case could be once made that these projects went through some kind of screening process, today (thanks largely to rule changes made during the Obama administration) the only screening is a fill-in-the-blank checklist.

The good news is that Ft. Lauderdale opened the bids for the streetcar construction that was originally projected to cost $142 million, and it now appears the costs will be closer to $270 million. The bad news is that the city will now be desperate not to give up the $61 million from the feds and will find some way to build it anyway.

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So, to keep $900 million, Maryland signed a $5.6 billion contract for a private company known as the Purple Line Transit Partners to build and operate the line for 36 years. Maryland taxpayers, of course, will have to come up with the other $4.7 billion. Sounds like a bad deal to me. I certainly wouldn’t buy a $250,000 house I didn’t want or need, especially if the house needed $300,000 worth of maintenance, just because a rich uncle offered to make the $90,000 downpayment.

Unfortunately, the offer of federal funding makes state and local officials go insane. So the Purple Line will probably be built (though there is still a lawsuit pending against it) and Ft. Lauderdale may get a streetcar. Yet neither are likely to ever carry many riders because not long after they begin operations most of their customers will be taken by driverless ride-share operators.