Monday, June 30, 2014

VIA: Streetcar Will Have A $1.3 Billion Impact on Local Economy

Posted By on Mon, Jun 30, 2014 at 7:34 PM

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Photo courtesy of VIA Metropolitan Transit.

The proposed downtown streetcar project is expected to have an economic impact of $1.3 billion for the city of San Antonio. That’s according to a study sanctioned by VIA Metropolitan Transit. (You can read the nine-page report here.)

Dr. Steve Nivin, director and chief economist for the SABÉR Research Institute at St. Mary’s University conducted the investigation, in collaboration with the Hispanic Chamber of Commerce. They measured the streetcar project’s economic effects on the local economy over the next 25 years.

The public transit agency plans to begin construction on two downtown streetcar routes next year. A north-south line will run from the intersection of Cesar Chavez and St. Mary’s to Pearl along the Broadway corridor, with a proposed northward extension to Cunningham Avenue by Brackenridge Park. A second east-west route will course through downtown along St. Mary’s, Navarro and Martin Streets to the Westside Multimodal Transit Center near the UTSA Downtown Campus. Both lines will eventually extend into the heart of Southtown. A future phase of the project envisions a third line running along Cesar Chavez to connect VIA’s two downtown transit centers. Here’s a map of the planned streetcar routes.

It’s no surprise any study commissioned by VIA would result in a sunny fiscal forecast for the city and its urban core. But what do their numbers say? In short, the city will see billions in returns from the $280 million streetcar investment.

Findings conclude construction of the streetcar system will have an $489 million economic impact for the region and support over 4,000 jobs. That’s just to build the streetcar routes and the supporting infrastructure. Once the system is operational, VIA claims it will attract over 7 million square feet of new development with taxable values totaling over $750 million. The study also estimates the creation of over 8,500 full-time jobs from new businesses that spring up along the streetcar lines. Those new businesses will have a $1.3 billion impact on the local economy over the next quarter century. Construction of those businesses will bolster the economy by another $1.8 billion. VIA also touts additional property tax and sales tax revenue that totals in the hundreds of millions of dollars.

The findings mirror those of a 2011 report conducted E. D. Hovee & Company, an economic development consulting firm based in Vancouver, Washington. SABÉR Research Institute also contributed to that analysis. The study’s positive economic outlook relied heavily on already planned residential and commercial development in the downtown area, such as the HemisFair revitalization or the surge in residential construction along Broadway. Many of the projects that supported the 2011 findings would most likely proceed whether or not the streetcar system was built.

Jeff Judson, one of the most vocal streetcar detractors (and, full-disclosure, related by marriage to the editor of the Current), disputes the findings in VIA’s economic report. He says one only needs to look at Portland to see how economic development pans out.

“You really need to look at the city’s that have mature systems to see the economic impact,” he said. “When Portland built their streetcar system, there was no private economic development for 10 years after the line opened.”

He claims the City of Portland had to issue subsidies to developers to entice them to build along the streetcar lines.

“In San Antonio, the reverse is happening.”

Judson points out that urban core development in San Antonio continues at a healthy pace in the absence of a streetcar system. According to the San Antonio Express-News, the city of San Antonio has handed out nearly $53 million in subsidies to incentivize the building of downtown residential units. He sees no need to spend hundreds of millions of dollars to spur development that is already taking place.

Judson also disputes VIA’s $280 million figure for the streetcar project. He states the system will cost $489.5 million for 5.9 miles of track, citing VIA’s own figures.

An anti-streetcar coalition is gathering 20,000 signatures to put the issue on the November ballot. The petition calls for a public referendum to change to city’s charter so that voter approval would be required before the city grants VIA right-of-way for any streetcar or light rail project. They plan to turn in their signatures to the city next week.

[RELATED: "A Historic Argument For A Streetcar Vote"]

On June 20, City Attorney Robbie Greenblum issued a legal opinion that seemingly neutered the impact of any public vote on the streetcar issue. He concurred with VIA's position that the agency's authority to build within those rights-of-way was granted by the Texas Transportation Code. Any vote against the project would be nullified by state law. Greenblum also wrote that any approved amendments to the city's charter could not be applied retroactively and would not impact VIA moving forward with construction.

Judson and his fellow opponents remain undeterred.

"There is nothing City Council can do to prevent it from going on the ballot," he said.

He added that he felt it was up to City Council to retroactively apply the charter, should voters approve their amendment.

"That's purely a policy decision. City Council will have to decide if they want to make it binding. If they want to be re-elected, they should probably watch how people vote in November."

Vote or no, VIA is determined to move forward with construction. They expect the streetcar system to go online sometime in 2017.

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