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Feds OK Grand Rapids’ ‘New Start’ Transit Funds

A state match would help other Michigan cities, too

February 4, 2008 | By Andy Guy
Great Lakes Bulletin News Service

  Bus rapid transit systems, like this one in Germany, mimic light-rail trains but cost far less because they use tires, not rails

GRAND RAPIDS—Just when it appeared that Michigan was hitting a dead end, Peter Varga, one of the state’s foremost transportation experts, got a hot lead on a New Start. Mr. Varga recently won federal approval, and perhaps as much as $29 million in earnest money, from Washington to build the most advanced public transit system in the Auto State.

The project, a sophisticated commuter bus route connecting downtown Grand Rapids with its southern suburb, is expected to spin off all kinds of new jobs and investment in Michigan's second-largest city. If it works—and civic leaders here seem confident that it will—tens of millions of additional dollars in so-called federal New Starts funding could eventually also flow to the state for similar projects in Detroit, Traverse City, and other cities.

All Mr. Varga needs to close his deal—and help get other Michigan cities into the line for federal transit start-up funds—is $7 million to match the New Start award. But where that additional money will come from is an open question.

"We don't want to stop this," said Mr. Varga, chairman of the Grand Rapids Area Chamber of Commerce and CEO of The Rapid, the regional transit agency serving greater Grand Rapids. "Michigan has to move into the future and improve its ability to attract new businesses, recruit knowledge-based workers, and compete economically. That kind of growth and development requires advanced transportation systems."

The transition that he is speaking about is the astounding move to the Digital Age that Michigan is facing—and beginning to make. The meltdown of the state’s formerly bread-and-butter manufacturing sector has turned loose tens of thousands of skilled employees, chased droves of families and talented young people from the state, and convinced weary remaining residents that rebuilding the economy is the state’s top priority.

Many state leaders now believe that gone are the days when a limited education and things like cheap gas, wider highways, inexpensive coal, and more coal plants drove sustainable growth. They see that stirring up innovation, embracing diversity, and preserving and restoring quality places to live are what work in the modern economy.

And while many observers agree that, given its manufacturing capacity and research universities, Michigan could lead America in the 21st century, they also point out that the state lacks a modern development agenda that harnesses the powerful economic, environmental, technological, and social trends now reshaping global society. Putting a much more aggressive strategy to revitalize cities on that agenda is a no-brainer, according to college students and economists alike.

So the modern bus project underway in Grand Rapids is emerging as a key test for the ability of the state’s elected leaders to understand, grapple with, and spend money on the need to move Michigan in a new direction. So far, several key Democratic and Republican lawmakers say that they are ready for that test.

A Train on Tires
The issue is coming to the forefront in Lansing because of a recent decision by the Federal Transit Administration.

In December 2007 the agency formally approved The Rapid’s application to build a permanent "bus rapid transit system" along Division Avenue, one of the busiest urban corridors in greater Grand Rapids. The decision, which comes after years of intense study, debate, and evaluation, effectively clears the way for the design, engineering, and eventual construction of a nearly 10-mile public transportation spur with hybrid busses running past 19 different stops every 10 minutes.

Bus rapid transit systems, or BRT's, mimic light rail trains but run on rubber tires. They have proven successful in cities like Denver, Miami, and Paris. And with satellite tracking, real-time rider updates, and priority over other vehicles at traffic signals, the Grand Rapids line easily will be the most sophisticated public transportation technology operating in Michigan when it's launched, likely sometime in 2012.

The estimated cost of the new infrastructure approaches $37 million. The Rapid proposes to fund 80 percent of the project through the federal New Starts program. The remaining balance, approximately $7 million, must come from other sources. The question is whether a state with shrinking revenues and a transportation strategy focused almost exclusively on cars, roads, and highways will come up with the money.

"We aren’t sure who’s going to take leadership on this yet," Mr. Varga said. "If the [Granholm] administration takes leadership, then we have to make sure the Legislature is supportive. If the legislators decide they want to take the initiative then we have to make sure that the administration is supportive."

Budding Bipartisan Support?
The importance of identifying a state funding source, and thereby securing the federal transportation money to build the Grand Rapids project, cannot be overstated, according to transit proponents and at least two lawmakers familiar with the issue. They say that the potential to land $29 million in additional federal funding offers Michigan—a state paralyzed by ongoing budget shortfalls and struggling to maintain roads, sewers, and other infrastructure—a crucial opportunity.

But whether a state that prides itself on transportation innovation for personal vehicles will take advantage of that big chance is unclear. The state has never before tapped into New Starts, the nation's primary spending program for public transit projects, even though dozens of cities and regions across America leverage its billions of dollars to plan, build, or expand major bus, streetcar, light rail, and commuter rail projects.

Because the program tends to favor those states and communities that have already navigated the federal granting process, some Lansing lawmakers see responding to Michigan’s first New Start opportunity as more than a $27 million opportunity. They say supporting Grand Rapids' successful New Start application with $7 million in state funds would pay off repeatedly in the future, when, say, Detroit applies for federal funding of the light rail line now under consideration for the Woodward Avenue corridor or of a commuter train to Ann Arbor.

"Grand Rapids is a foot in the federal door for Michigan," said state Representative Marie Donigan, a Democrat from the Detroit suburb of Royal Oak. "This is the first serious federal money that will come our way for a mass transit project. It’s important that we all support this project to keep the state moving forward."

"Our biggest hurdle at this point is to paint the big picture for the [Michigan Department of Transportation], the administration, as well as our colleagues in the House and Senate," said state Representative Tom Pearce, a Republican from the Grand Rapids suburb of Rockford. "By bringing these dollars home to Michigan, we bring the entire state into view for future federal funding for new transportation projects."

Where’s the Money?
The issue, public transit proponents say, is not whether Michigan has the money to spend. They point out that while the budget crisis dominates the headlines, the state still spends billions of dollars a year on a wide variety of economic development and public interest projects while mostly ignoring public transportation.

In the greater Grand Rapids region, for example, the Department of Transportation recently completed a suburban highway that cost nearly $1 billion. And the agency later this month will hold a public hearing on a plan to widen a highway running through the central city. That project costs more than $375 million. But the agency has invested little to reduce the city's dependence on the automobile.

What's needed, transit proponents and a growing number of local and economic leaders agree, is a state policy and spending agenda that recognizes the importance of mass transit infrastructure to Michigan's economic competitiveness and environmental quality in the 21st century. The BRT project on the drawing board in Grand Rapids brings new urgency to that debate.

"It’s very important for the state to recognize that this is the first, but certainly not the last, project in Michigan to pursue New Starts funding," Mr. Varga said. "So we need a policy and a process in place to leverage the federal dollars. Is it going to be easy to say 'no' to $27 million because you don’t have $7 million over several years to build something?"

"If you say 'no' to this," he added, "you're saying 'no' to everything in the future, whether it's a transit project in southeast Michigan, Traverse City, or wherever in the state a project meets the federal criteria."

Mr. Varga continues to work with the Federal Transit Administration to determine how the agency will time funding for the BRT project in Grand Rapids. But, to effectively leverage the federal dollars, his agency likely will need the state to appropriate some funding no later than 2009. The earlier, he said, the better.

Journalist Andy Guy directs the Michigan Land Use Institute’s Grand Rapids project. He is also managing editor at Rapid Growth Media and maintains a blog at http://greatlakesguy.blogspot.com/. Reach him at aguy@mlui.org.

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