The case against rail transit

Ohio is planning to build a passenger rail system, with millions from the federal government. However, that project would require even more millions from Ohio taxpayers to construct and a taxpayer subsidy of at least $17 million a year - over and above any revenue - to operate.

I've written in opposition to this passenger rail project because it cannot be self-sufficient.

Now comes a new study from the CATO Institute that demonstrates just what a bad deal such projects are - for everyone!

Over the past four decades, American cities have spent close to $100 billion constructing rail transit systems, and many billions more operating those systems. The agencies that spend taxpayer dollars building these lines almost invariably call them successful even when they go an average of 40% over budget and, in many cases, carry an insignificant number of riders. In a new study, Cato scholar Randal O'Toole uses the latest government data on scores of rail transit systems to evaluate the systems' value and usefulness to the public.
- Defining Success: The Case against Rail Transit, by Randal O'Toole

Strickland is the real 'cheerleader for failure'

A Google search will show multiple links to the headline "Strickland Lashes Out at Critics of Rail Plan," which is what Governor Ted did two days ago, calling opponents of his plan "cheerleaders for failure."

I don't believe the Governor understands the meaning of the term 'failure' if he really believes what he said.

From the WSPD News website:

COLUMBUS, Ohio (AP) Ohio Gov. Ted Strickland is lashing out at critics of the state's plan to use $400 million in federal stimulus money for a startup rail service, calling them ``cheerleaders for failure.''

Strickland said Tuesday he's tired of people who attack every idea that comes along and always look for something negative to say.

The governor says that's not the way to move Ohio forward.
...
Strickland says other states would have rejoiced to receive $400 million in federal funding.

Just a reminder: this plan that Strickland is so fond of will cost more than $500 million dollars, so getting $400 million from the feds just means the state has to come up with another $100 million or so in order to get it built. Ohio doesn't have that money - at least, not without giving up something already planned in the capital budget.

I've written previously about the operational costs of the rail plan, pointing out that the Governor's own report says the system will cost $29 million a year to operate, but is only projected to have $12 million in revenue - meaning the Ohio taxpayer will have to pay $17 million a year just to run the system once its built.

See that? This rail plan requires the taxpayer to pay nearly 60% of the yearly costs while those who ride it will only have to pay 40%. Do we really want to spend our limited tax revenues on such a boondoggle? Aren't there more important things already being cut out of the state's budget because it doesn't have enough money to break even? And Gov. Strickland thinks this is a good idea?

Talk about failure! I can think of nothing that so qualifies as a massive failure than to rejoice over a system that will cost us so much money to operate.

Obviously, it's not a good idea. But that won't deter a bunch of politicians who've already backed it and begged for money from the federal government (meaning you and me and every other taxpayer) to build a system that won't even come close to breaking even.

So what's a governor to do? Demonize the people who are using logic and reason and sound fiscal analysis by calling them "cheerleaders for failure."

Sadly, the only cheerleader for failure in this instance is Ted Strickland. The rail plan is a fiscal drain on a already tapped-out state. To continue to push it in spite of the financial reality is certainly not the "way to move Ohio forward."

Costs, facts ignored in Blade editorial on passenger rail

Today's Blade editorial, Keep Toledo On Track, continues the paper's editorial position in favor of passenger rail service across the state.

However, it ignores a very key point, reported in their own news pages: the cost!

"The study projected revenue of $12 million a year, with Ohio having to kick in an additional $17 million operating subsidy."(emphasis added)

Strangely, the editorial proudly mentions the yearly projected revenue (though it never questions the lack of accuracy found in most government revenue projections) but doesn't bother to include the critical data that comes from Amtrak: that Ohio taxpayers will have to pay nearly 60% of the yearly cost of the system!

I talked about this on WSPD this week when I was filling in for Brian Wilson on the Afternoon Drive, so if you listened, this may be a bit of repetition - but it's a point that needs to be made repeatedly.

How can anyone - elected officials, citizens, newspaper editorial boards - possibly support a project that would require the taxpayers to foot so much of the cost, especially during this economy and with many government entities facing huge deficits???? Even in a good economy, this is a bad idea since there are other existing needs in the state that could - and should - come before a new expense.

Where will the $17 million a year come from?

It can only come from us - the taxpayers of the state.

And that $17 million is just a guess. When was the last time you heard of a government program coming in at projected costs? Of course, the $17 million is only what they project at the start - as time goes on, that cost will increase ... continually.

There's another point in the editorial designed to skew your perspective: usage.

According to the paper, "478,000 people would patronize the new service in its first year." However, the study actually predicts 478,000 riders - which means that a single person making numerous trips does not count as 'one' - but rather counts as however many trips made or tickets purchased, the same way our TARTA system counts patronage. So the number of people who actually use the rail service would have to be no more than 239,000 because each person who got on a train to go somewhere would probably have to return home as well: one person, but two 'riders.'

We don't need another huge cost in the yearly state budget, especially when less than 2% of the state will be the beneficiaries.

It boggles the mind how anyone could support such a boondoggle when you weigh the exorbitant costs and the extremely small number of people served.

Ohioans need to say NO! to this expensive, unrealistic, and completely unnecessary project.