A rebuttal to Fort Worth streetcar opponents

Flawed City Council reasoning?

Vilas Bhuchar, Dec 20, 10.

Two weeks after Fort Worth’s streetcar project was derailed, Fortworthology writer Kevin Buchanan offered a rebuttal to an email that outlines reasons why District 7 City Council representative Carter Burdette voted against the modern streetcar project and helped stop a feasibility study of the project:

An e-mail has been circulating recently from District 7 City Council representative Carter Burdette, outlining the reasons why he voted against the modern streetcar project and helped kill the study. As this e-mail has been forwarded to us by numerous Fort Worth citizens, it is clear that there is still a lot of interest and debate happening about this project, and it is necessary to publicly address these points. If these points are legitimately why Carter voted against the project, we feel it is important to make clear where these points do not hold up to scrutiny so that the council and the public can be fully informed.

Councilman Burdette’s points follow, with our comments after each. We have confirmed the accuracy of our rebuttals with city staff. In addition, we have a very interesting letter concerning streetcar funding and the “putting the taxpayers at risk” portion of the opposition voiced during the council vote. That letter will follow after the rebuttal to Councilman Burdette’s e-mail.

From: .(JavaScript must be enabled to view this email address)

Thank you for your recent email regarding the Council’s vote on streetcars. I could not support going forward at this time because:

1. The Federal money would not be paid to us up front, but would be a later reimbursement.

Fort Worthology: This is not accurate. The reimbursements would be ongoing during the course of the project, not “later” at the end of the project as Carter seems to be saying. The city, or whoever winds up building it, would submit monthly invoices for reimbursement. This is how our Federally-funded road projects work as well – it is perfectly normal and very common, and is not risky at all.

2. Economic development dollars would not be realized by the TIFs – if at all – until 10 or 15 years down the road.

Fort Worthology: First of all, what is he saying – is he arguing that developers probably aren’t interested in building on streetcar lines, and if they are, they aren’t planning on doing it any time soon? That’s demonstrably false. We have developers who have assembled parcels of land in the Near Southside and are looking to do high-density residential/mixed-use if there’s a streetcar line. This is near-term economic development, not “10-15 years down the road.” Without the streetcar, we’ll likely see those parcels get developed with much less residential, much less density, less valuable projects, or not developed at all. Secondly, in addition to the development, those developments will almost certainly have retail components on the line, meaning new sales tax revenue going into the city coffers right away. Further, the Near Southside TIF – TIF #4 – would expire in 2022, only 8 years after the streetcar line started. After 2022, all tax dollars from the former TIF district would be going into the general fund again.

3. Therefore, the $85-$90 million needed to build the “starter line” would have to be borrowed by the City.

Fort Worthology: Any borrowing would involve the TIFs. The TIFs are projected to generate enough revenue to afford the streetcar even if you assume zero development related to the streetcar, so this risk is heavily overblown. Borrowing against future revenues is the standard TIF model, thus the “financing” part of their name. Just because we have pay-as-you-go TIFs doesn’t mean that we’re entering uncharted territory here or putting the general fund at risk. This strikes us as a real red herring. The streetcar study has presented a thoughtful and conservative public investment scenario, not a risky one.

Please see our follow-up after the e-mail for further information about the “risk” to the city.

4. In view of the City’s unfunded retirement plan balance of over $700 million, and the City’s expected budget shortfall the next few years, it is unlikely the City would be able to borrow $85 million without pledging its general fund taxpayers to repay that debt.

Fort Worthology: See above. That would be the case if the plan called for bonds secured by the city’s general fund, but since the financing would be secured with TIF revenues, financing shouldn’t be a problem. That type of TIF financing is done all the time.

5. I do not believe it is appropriate to saddle the City’s taxpayers with such an additional debt in order to serve less than 2% of our population, and a small number of real estate developers.

Fort Worthology: He’s right – that wouldn’t be appropriate. Fortunately, that’s not at all what was being proposed. ”The city’s taxpayers” aren’t being put on the hook.

6. To effectively address transportation and ecological needs, the City would have to commit at least another $500 to $600 million to construct an effective streetcar system.

Fort Worthology: Extremely misleading and untrue. The starter line could be effective as a standalone system – that’s one of the exact reasons why the starter alignment was chosen, as HDR made the point that even with zero expansion of the system it would be viable on its own merits. Other cities have similar stand-alone transit systems that worked effectively without expansion, or in cases where they were expanded it was because the expansion was a smart economic decision, not because the initial line’s construction forced them into it.

7. The majority of City streetcar systems throughout the US have not proven to be economically effective as a transportation or economic development vehicle.

Fort Worthology: We really wonder where he’s getting this, as streetcar systems large and small across the US thus far have had good track records, even without Portland’s exceptional results. Even cities as small as Tacoma and Kenosha have seen good results in both transportation and economic development with their streetcars. (We’re wondering if “economically effective” means he’s still hewing to the tired old double-standard of requiring transit to be profitable but not caring that absolutely no road projects are profitable.) Based on his council meeting comments, we think he’s basing this on “studies” conducted by Randal O’Toole, a pro-sprawl, anti-rail critic (who receives funding from oil, gas, and highway lobbyists) who makes these same arguments against all forms of rail transportation. There is ample evidence from the city’s consultants (who are far more reputable, to say the least) demonstrating that this statement is way off the mark. There are actually fact sheets out there dedicated solely to debunking the inaccurate claims made by O’Toole (for example: http://www.cnu.org/sites/www.cnu.org/files/DebunkingCato.pdf ). We spoke with an AICP-certified planner here locally who’s attended many professional conferences over the last 15 years, and he said in no uncertain terms that he’s never heard any public official from a city with a successful urban core say that they relied on guidance from Randal O’Toole & similar people to improve their central city.

Finally, Buchanan also includes a letter that was given to members of the City of Fort Worth Modern Streetcar Task Force as funding options were being reviewed - the letter shows that private companies were willing to work with the TIFs to provide funding for the project, according to Buchanan’s post.

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