Michigan Land Use Institute

Thriving Communities / News & Views / Running Out of Options for MI Transit

Running Out of Options for MI Transit

Cities need more ways to pay

All Aboard | January 31, 2013 | By James Bruckbauer

About the Author

James Bruckbauer is the Michigan Land Use Institute’s transportation policy specialist. Follow him on Twitter at @jimbruckb. Reach him at james@mlui.org.

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Here's what the Kansas City streetcar could look like in 2015. (Photo illustration: HDR, Inc.

In 2015, if you’re one of Kansas City’s 21 million visitors, you’ll be able to travel 2 miles from the city’s Union Station to the hip and historic River Market district by riding a slick, modern streetcar.

The streetcar is the city’s latest effort to provide an easy and convenient option for visitors and residents to get from one side of town to the other, with frequent stops along Main Street where visitors can shop at local store or dine at unique restaurants.  

Downtown’s young professionals will be able to jump on the streetcar to get to their offices in the impressive Financial District; then, after work, they can stop at a nearby pub to mingle with friends.

The streetcar project is expected to spur about $300 million in new apartments, condos, offices, and shops along the line.

Streetcar advocates see a bright future for Kansas City, but getting to this point wasn’t easy.

When voters in Kansas City rejected a proposal in 2008 for a $900 million, 14-mile light-rail line, property owners in the city’s downtown district decided to take matters into their own hands. They scaled down the transit proposal to cover just two miles. Then they voted to raise money for the streetcar with their own property taxes and hiked local sales taxes by 1 percent to pay for the local portion of the project. Construction begins next year.

The Midwestern city best known for jazz, blues, and barbeque is responding to a new economic reality: In order to attract talent and stay relevant in a global economy, sleek modern transit is no longer a choice. It’s a requirement.

But with state and federal transportation dollars dwindling and failing to keep up with local needs and demands, cities need a mix of financing tools so that they can maintain quality streets and build first class transit.

In Michigan, however, local financing options are hard to come by.

Michigan has few choices when it comes to raising money locally for transit. Transportation agencies can only ask voters to pitch in through local property taxes. They must rely on fewer and fewer state and federal dollars for the rest of a project’s cost.

Right now, streets, highways, bridges, and bus systems in Michigan are paid for through gas taxes at the pump, registration fees, and a large amount of federal general fund money.  The gas taxes are sent to Washington and then distributed to each state. The share that Michigan receives is a little less than it gives.

There are proposals in Lansing to raise registration fees and fuel taxes to raise more state money for highways, streets, buses, and trains. But until the state Legislature allows cities to use more local options to pay for transportation, Michigan’s residents and visitors will continue to face crumbling roads, congestion, and limited bus service.

State lawmakers can seize this opportunity to give local governments the necessary local tools to pay for streets, transit, and non-motorized options on their own.

Like Kansas City, many other cities use local tools to meet their transportation goals:

 - Chicago raises about $35 million a year for transit using by charging a modest property tax transfer fees when someone sells their home.

 - Voters in metro Cleveland overwhelmingly opted to raise money through sales taxes to pay for an extensive region-wide transit system that now includes light rail and bus rapid transit. It is credited for spurring $5 billion in new development.

 - In Los Angeles County, voters approved a half-cent sales tax that will pay for local transportation projects including a commuter rail line and a long list of local street projects.

 - Fort Collins, Colo., is easing commuter traffic into town and through neighborhoods by dedicating a half-percent sales tax to fund street improvements and a bus rapid transit system.

- In Orlando, Fla., in order to ease the cost and burden on property owners, the city uses parking revenue to pay for its bus rapid transit system.

Those cities are building the places where talent wants to live.

Michigan lawmakers must stop holding its cities back. Our towns can start meeting their transportation needs without waiting for the state to solve the state transportation crisis.

Over and over again, ballot results prove that voters are willing to pay for local transportation projects if they know exactly what it is they’re paying for and if they clearly understand the benefits. Last year alone, 80 percent of transit millages passed, according the Center for Transportation Excellence. In 2011, 10 of 11 transit millages in Michigan were successful.

Giving communities local options is not a new idea in Lansing. In fact, in 2008, lawmakers introduced a package of bills that would give local governments more options for raising their own money for their own transportation needs.  The bills, if passed, would have granted local governments the ability to ask voters how they wanted to pay for transportation projects: through local sales taxes, local gas taxes, property tax transfer fees, or local license and registration fees.

If lawmakers pass a statewide transportation funding increase this year without more local options, the incentive to create these options goes away. Now is the time to stop holding cities back and finally give them local tools they need to build world class cities with world class transportation.

James Bruckbauer is the Michigan Land Use Institute’s transportation policy specialist. Follow him on Twitter at @jimbruckb. Reach him at james@mlui.org.


4182 days ago, 7:00pm | by Thomas Reynard | Report Comment

Grand Rapids MI will soon have a new bus line 'The Silver Line'. This is one and only one extended bus line that is to service the downtown core of the city; going into the out lying areas.
Please note that bus service on Sundays ends at 6pm, but we have the 'Silver Line'..its a line alright.

4182 days ago, 7:55am | by James Bruckbauer | Report Comment

The Silver Line in Grand Rapids will be Michigan's first bus rapid transit system. The Rapid has already raised money for both the capital and operating costs.

I'm excited for them to begin construction.

A downtown streetcar will be next.

4170 days ago, 9:36am | by Dennis M. Adams | Report Comment

Michigan's cities are planning on expanding to meet their constituents needs and the local fund raising question is a legitimate one that unfortunately does not address the way in which monies from the Comprehensive Transportation Fund (CTF) are distributed. Current distribution from the CTF is based on transit agency budgets, hence "the more you spend the more you get". This puts rural transit systems at significant risk and has over the last decade seen reimbursement to rural transit agencies shrink from the legislatively allowed 60% to as low as 34% just a few years ago. Without a fix for this distribution formula, and simultaneously an increase in funding for public transit, rural systems will continue to suffer funding losses. Rural systems in Michigan currently serve 40% of our population while drawing down 17% of the CTF funding. MASSTrans offers a solution that can be accessed on our website at masstrans.org.

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