Kansas City Streetcar
Graham Renz

What could make the tax bills Kansas Citians might have to pay for an expanded streetcar system any worse? The opportunity cost of the quarter-billion-dollar project. 

Revenue SourceAmount (2019 $)
Bonds (backed by TDD taxes)$129,500,000
Federal Grant$100,000,000
STP/CMAQ Grant$14,500,000
TOTAL REVENUE$244,000,000
    
Capital Costs Amount (2019 $)
Construction$227,150,000
Contingency$16,850,000
TOTAL COSTS$244,000,000

The table above shows the projected revenue sources and costs of the proposed streetcar expansion. Note two things: (1) The expansion is over 20% more expensive per mile than the existing 2.2-mile downtown line; and (2) $14.5M of the required revenue would come from Surface Transportation/Congestion Mitigation–Air Quality (STP/CMAQ) funds.

STP/CMAQ grants are federal dollars allocated throughout the region by the Mid-America Regional Council (MARC), a consortium of government officials. These funds are used to build streets, bridges, trails, and other transportation projects. Jurisdictions from Platte to Cass counties rely on these funds to meet their basic infrastructure needs.  

By targeting these funds, streetcar advocates are asking that the streetcar be given higher priority than other regional projects—much higher priority. During the next two-year STP/CMAQ funding period, roughly $42M in funds will be available. So the $14.5M grant that rail advocates are after could gobble up more than a third of the total funds. As a result, other regional priorities could wait years until funding becomes available again. The request for STP/CMAQ funds also demonstrates that rail proponents are trying to offload even more of the cost of their expensive project on taxpayers far outside city limits. (Note the $100M federal grant listed among the revenue sources.)

Rail advocates might reply that even if a grant is awarded to expand the streetcar, funds would still be available for other projects. While it’s true that some funds might still be available, this response overlooks the opportunity cost of funding the extension, not to mention the opportunity costs already incurred for the downtown line. In 2013, the downtown line received an unprecedented $17.3M in STP/CMAQ funds. The streetcar has already pushed projects to the back of the line before—why should it do so again?   

So while rail advocates seek out another multi-million-dollar grant, public officials should ask themselves: Is the streetcar project the best use of regional funds?  

About the Author

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Graham Renz
Policy Analyst

Graham Renz is a policy analyst at the Show-Me Institute.