Streetcar Financing Plan – How it all works
Press Release wrote Mayor Coleman Unveils Streetcar Financing Plan
‘Benefit zone’ to provide 80% of funding
March 27, 2008
Streetcars could be riding the rails in Columbus in 2012 under a plan outlined tonight by Mayor Michael B. Coleman, City Councilmember Maryellen O’Shaughnessy, and a team of engineers and financial experts. The team brought together the Mayor’s 42-member Streetcar Working Group and residents to outline the funding scenario to pay for a $103 million starter line that would travel 2.8 miles up High Street from Mound to The Ohio State University campus.
“We’ve done our homework and asked the toughest questions, and it is clear that streetcars can be good for Columbus,” said Columbus Mayor Michael B. Coleman. “A sleek, modern Streetcar system will reconnect neighborhoods and downtown, connect workers to jobs in a time of high gas prices, help build our economy, and we can do it all without a citywide tax increase.”
The plan represents more than two years of study by the City, businesses, civic leaders, and most recently by HDR, a national engineering firm, and John Rosenberger, formerly of Capitol South, who developed the detailed financial scenario. An economic impact study commissioned by the Streetcar Working Group from the Danter Company estimated $300 million in private investment in new housing, jobs, commercial development and visitor activity along the first phase of the streetcar line.
“Along these routes you have a lot of people – some 50,000 students, 141,000 workers at 6,000 companies and another 60,000 people who live between campus and downtown Columbus. Every year we get more than one million visitors for conferences and conventions. If we share the costs among all those who benefit from having access to streetcars, we can build a great system by our Bicentennial in 2012,” said Maryellen O’Shaughnessy, City Council Member.
The funding scenario presented to the Streetcar Working Group during a public meeting held at City Hall calls for 80% of the funding to be generated from within a ‘benefit zone’ drawn approximately three blocks on either side of the Streetcar line.
All parking revenue from the ‘benefit zone’ would be dedicated to streetcars, including a increase on metered parking, and a 4% surcharge on paid parking and ticket admissions to sporting and entertainment events. Fares and an annual funding contribution from The Ohio State University would bring ‘benefit zone’ funding to 80% of the cost needed to build and operate the starter line.
“This is a funding scenario that asks a lot of people to pay a little, so that no one has to pay a lot,” said John Rosenberger, a local expert on public private partnerships and downtown development. “We have been timid too long, streetcars would be a bold, transportation option that would drive a new generation of investment.”
While the majority of funds come from those who live, work and visit the ‘benefit zone’, the remaining 20% will be paid for by the greater community, which also benefits from the economic growth of the area. The Mid-Ohio Regional Planning Commission (MORPC) has already pledged $20 million to the project.
Mayor Coleman proposed an initial investment from the City Capital Budget of $2 million in 2008 to begin engineering the project. Under this scenario, the streetcars could be rolling as early as 2012, in time for the City’s Bicentennial celebration, with construction starting as early as 2010.
In making its recommendation to move forward, in November 2006, the Streetcar Working Group identified several benefits that streetcars would bring the city including economic development, connectivity, help with parking, and green transportation. The streetcar also fulfills part of Mayor Coleman’s Downtown Business Plan that has already attracted two billion dollars of investment since 2002.