Over Memorial Day weekend, I was in Phoenix researching that city’s light-rail service. Seriously. I wasn’t there to see U2 in concert. This was work.
My hotel was a few miles east of downtown and the US Airways Center. A Valley Metro Rail station was just a few blocks from the hotel, and the line went right past the arena. The trip downtown was fairly quick. The trip back to the hotel wasn’t quite so smooth, because the concert and an Arizona Diamondbacks baseball game at adjacent Chase Field finished at roughly the same time, but I still got back to the hotel in a little over an hour. It beat sitting in a traffic jam in a parking garage.
I see why some people rave about the Metro. But, short of the few dollars for my round-trip fare, I’m not paying for it. That led me to wonder who is paying for it and how they’re paying for it, since a light-rail subway on the Strip is among the latest (and incredibly expensive) proposals to improve mobility in the congested Las Vegas resort corridor.
First, it should be noted that the initial 20-mile line in Phoenix cost $1.4 billion — $70 million per mile. Nearly half of that $1.4 billion — $647 million — came from the federal government. (So I actually did pay for some of it, as did every other taxpaying American.) This, says Randal O’Toole of the Cato Institute, is what makes light rail so incredibly attractive to large cities looking for transit upgrades: the huge subsidization of start-up costs. The rest of the funding for Phoenix’s starter line came primarily from a countywide transportation tax passed by voters and through revenues from member cities (Phoenix, Tempe and Mesa), and subsequent extensions were funded by a combination of federal money, the transportation tax and local revenues.
According to statistics from the National Transit Database, operating costs for Valley Metro in 2013 were $28.7 million, and maintenance costs were $3.3 million, for a total of $32 million. Fares provided $12.8 million, covering 40 percent of the operating and maintenance costs. That 40 percent figure, according to statistics from Valley Metro, has been relatively stable annually.
But that means taxpayers — including everyone who doesn’t ride the train — fund the other 60 percent of operating costs, and they’ll continue to fund it in perpetuity, unless ridership suddenly goes through the roof. O’Toole notes the region’s population in 2013 was 3.6 million, and light rail’s average daily trips numbered about 44,000. But as Phoenix resident Warren Meyer wrote in a 2010 article for Forbes.com, the number of actual riders is generally half the number of daily fares, because they’re taking round trips. Which means that federal and local government agencies laid out $1.4 billion (O’Toole says $1.85 billion is more accurate), and local taxpayers still provide upward of $20 million in annual payments for a system that transports less than 1 percent of the population.
Further, the number of people using mass transit in Phoenix has been flat — even dipping for a three-year stretch — since light rail began operating in 2009. A chart on Meyer’s Coyoteblog.com shows Phoenix area bus ridership growing from just over 40 million trips in 2001 to 65.6 million in 2009. In 2009, light rail added approximately 5.5 million riders, for a total of about 71.2 million. But over the next three years, that number was lower before getting modestly higher in 2013 and 2014 — nothing like the tremendous growth of the nine years before the arrival of light rail.
The reason for that, Meyer noted, is that rail ridership cannibalized bus ridership. Total Phoenix ridership in 2014 was 72.1 million trips (57.8 million by bus, 14.3 million by rail), barely ahead of the 71.2 million in 2009. Meyer calculates ridership should be at more than 90 million. But there’s been no real growth in the light-rail era, while there has been extreme growth in taxpayer cost.
This situation is not unique to Phoenix. Denver and Salt Lake City face similar issues, O’Toole said, noting the Las Vegas Strip is unlikely to defy that trend by building light rail in any fashion. More on that next week.
Patrick Everson is an editorial writer for the Las Vegas Review-Journal. Follow him on Twitter: @PatrickCEverson.