Federal Funding for Streetcars

Thanks to Gary Scott for the invitation to write a blog post for the Congress for New Urbanism’s website. The data and conclusions are based on a working paper by myself and Prof. David King.  In case the link fails to work, I’ve re-posted the content below.

Transportation and Equity: Federal Funding for Streetcar Projects

Tags: modern streetcars, federal grant programs, social equity

Federal competitive grant programs allow federal officials and policy makers to favor certain transportation projects over others. Historically, this has allowed federal actors to pursue preferred policies – such as building interstates, reducing carbon emissions or facilitating mode shifts – without having to directly implement projects. This division of labor makes sense when impacts from projects have national consequences, such as completion of a national road system or congestion reductions in urban areas that contribute to the national economy. But what is the role of competitive federal grants when project benefits have solely local consequences, such as downtown property development?

Take for instance modern streetcar systems, which are the rage in U.S. cities. Unlike other modes of transit, such as light rail or bus rapid transit, the benefits of streetcar projects are thought to accrue through property development or local economic stimulus rather than through enhanced transportation services. This is evident in the table below, which shows data collected from cost-benefit analyses of streetcar projects receiving federal TIGER grants. Since TIGER is an outcome of the American Recovery and Reinvestment Act, we would expect that these projects to have large economic impacts, but in general most streetcar projects emphasize their economic development potential more than their contributions to the transit network.

These numbers raise interesting questions about the role of federal grant programs in supporting or hindering local equity agendas. If federal competitive grant programs incentivize the creation of projects with substantial economic development impacts – like streetcars – then does the grant process reinforce patterns of unequitable resource distribution while also failing to improve transit services for dependent populations? Of course, many streetcar projects are aimed at facilitating pedestrian friendly environments as well as stimulating downtown real estate and there is potential that such improvements to the built environment will benefit all transit users (including the transit dependent). But this outcome is contingent on the spatial distribution of residences, workplaces and transit services. If the poor or transit dependent populations live outside of the streetcar’s vicinity and/or do not work in the central business district (where streetcars tend to be located) they will not directly benefit from the streetcar-influenced pedestrian environment. As U.S. downtowns again become places for residential development, who can afford to live in the central business district? There is strong evidence that it’s not transit dependent or low-income populations.

Some of these concerns are raised in a working paper sponsored by the MacArthur Foundation. Based on an analysis of 2009 TIGER awardees, the authors conclude that federal competitive awards have the potential to deepen disparities among and within regions. Within regions, the study finds that capacity of equity or affordable housing actors (such as non-profits) is important for leveraging federal investment to assist low-income or transit dependent populations. If the federal government seeks to address issues of uneven resource allocation and the widening wealth gap in American cities, federal policy makers should reevaluate competitive grant programs in light of such goals. Those of us seeking to expand transit usage in US cities have a responsibility as well – to ask whether specific investment decisions mitigate or exacerbate issues of equitable resource distribution. If we support transit projects solely for the sake of having new investments but fail to consider their influence on local resource allocation, are we missing an opportunity to leverage federal funding to address longstanding patterns of inequality in American cities, and to act in a socially responsible manner?