What if We Bought Into the Light Rail Hype, and Built It For Everyone?

Last year, there were about 3.2 trillion passenger miles driven by urban drivers in cars in the US.  My point about light rail is that we can barely afford it for just a few people, given that we spent $1.3 billion to build a rail line for just 17,000 daily round trip riders in Phoenix.  If it were truly a sustainable technology, it could be applied to all commuters.  But at a national average taxpayer subsidy per light rail passenger mile of about $2**, this means that to roll light rail out to every urban commuter would cost $6.4 trillion a year in government spending, almost half our annual GDP.  If it required the subsidy rates we have in Phoenix per passenger-mile, such a system would cost over $12 trillion  year.  In fact, the numbers would likely be even higher in reality, because light rail in most cities is almost certainly built on the highest populated corridors with the most bang for the buck (though some of the diminishing returns would be offset by network effects).

Light rail only works today because we drain resources from millions of taxpayers to benefit just a few generally middle class commuters.    This is not a model that will scale.

** This includes both service on the debt, which is payment for the original construction costs, as well as annual operating losses.  This subsidy is required essentially forever.  After 20-30 years when the original bonds are paid off, by that time systems generally have to be rebuilt in their entirety   (as folks in places like Washington DC are learning).  There are probably only 5-6 cities in this country that have the urban population densities to make rail systems come even in the ballpark of working financially, and places like Phoenix, Seattle, Houston, Portland and LA are NOT among them.


  1. Chris:

    Sympathetic to your dislike of train subsidies, but have to take issue with your math.

    With more ridership, subsidies would naturally fall due to higher passenger miles per mile of track and per mile of train travel. So you can't multiply our current automobile passenger miles times today's subsidy rate.

  2. MJ:

    With more ridership, subsidies would naturally fall due to higher passenger miles per mile of track and per mile of train travel.

    And where would this additional ridership come from?

  3. Sol:

    I've got to agree with Chris, and I'm with you 100% on hating light rail subsidies. The math just doesn't work the way you've used it.

  4. Brian Dunbar:

    You're not thinking, dude. Light rail will work for everyone. As soon as we all move into arcologies and work downtown.

  5. Maddog:

    Actually the math is wrong but not the way Chris presumes. Expanding light rail to the rest of the country would expand it into far less dense areas meaning mileage would increase far faster than riders. The fare box recovery would decline on a per passenger mile basis and maintenance would increase as would operating costs.

    A few years ago my son did a regression analysis on light rail for various costs, carbon and pollution issues. When including New York the analysis proved light rail was an economic and pollution disaster. When excluding New York it was far worse. Cost on a per passenger mile basis outside of New York was so high it never made sense. His analysis was that for carbon use and pollution it was better to buy a new SUV every 3 years for the next twenty years than to ride light rail/transit. This had to do with the fact that autos improve particularly regarding pollution issues while transit does not.

    One of his odd findings was that prior to building light rail transit agencies used less motor vehicle fuels per passenger mile than they did after building light rail. Since light rail uses electricity this was a hard to understand but important finding.

    Portland is adding another light rail line which will result in the near total destruction of the city's bus system. It will cost $1.4 billion and cover 7.3 miles or $36,000 per foot. Since this is the preliminary liar's budget it is likely to cost at least 50-60% more or about $2.1 billion or $55,500 per foot. Few will ride it and the fare box will not even cover the operating expenses. The city is broke, the transit agency is broke, unemployment is high, and so who is going to pay for this new toy?

  6. Danny:

    Actually no, Chris is spot on. The marginal cost per rider is almost negligible....as more riders use it, the cost per rider drops precipitously. A system like Phoenix might have per rider costs of $2-3, whereas the system in Calgary, where far more people use more or less the same amount of rail cars and track, has per rider costs below $.30. Putting more riders on the same rail system lowers subsidies, not increases them.

  7. Reid Greenmun:

    In our region (Tidewater Virginia) the small city of Norfolk lied to the Feds to get funding for a tiny 7.4 mile light rail system. Norfolk and our regional transit provider (HRT) filed for a Federal New Starts Grant claiming the entire system would cost $232M. It isn't completely built yet or up and running - yet it is already over a year late - and it is 43% over the submitted cost-to-construct commitment - our tiny light rail “Starter Line” is now at a cost of $338M - yes, that’s $338M for just SEVEN miles of rail. And ... that is rail that is being constructed along on old, existing and abandoned Norfolk Southern Railroad rail line - a "corridor" that required very little condemnation and was therefore less expensive than most light rail construction.

    The usual suspects are behind pushing this embarrassing train wreck - they are developers, certain political law firms that enrich themselves from the LRT projects, bankers, Unions/Progressives, and the politically influential transit provider and engineering firms that build light rail systems - not to mention Dominion Power, our state's politically powerful electric providers. Don’t forget that our light rail uses taxpayer subsidies electricity to operate.

    In my region Light Rail is not about moving people or reducing existing commuter traffic congestion, it is about MORE taxpayer-subsidized URBAN redevelopment. It is about more Union Jobs. It is about expanding the Progressive/Democratic Party urban strongholds -while at the same time, using tax money to attack the Conservative suburban and rural taxpayers/citizens. It is about a massive "redistribute-the-wealth" strategy predicated upon a strategy to divert much needed road funds - road funds paid for by drivers and their gas taxes - to divert the gas tax money to subsidize transportation for an ever-expanding, government dependent, low-paid, "urban-class".

    These so-called “economic development investments” are accomplished by use of false government - the use of unaccountable, often all-appointed regional "governing" bodies - governing bodies stacked with special interests "representatives". MPOs and other "regional" decision-making structures that designed to subvert the power of the voters while they push their urban utopia "vision" - and while the do the bidding of local politically influential business lobbies. The business lobby’s partners-in-crime include local taxpayer subsidized academic institutions - colleges and universities that conduct “studies” for the MPOs and “Light Rail Now” cookie cutter business lobbies.

    Light rail and TOD (Transit Oriented Development) is a cancer. A cancer that attacks the bank accounts of the driving public in order to line the pockets of politically influential businesses and the politicians they paid to put into office.

    In our region the regional transit provider, HRT, plans to only charge light rail riders 10% of the operating and maintenance costs. This is because they know if they changed the riders the actual $30 a day it costs to ride the 7.4 miles, no one would ride it and their false claims that Light rail are supposed to reduce traffic congestion would be exposed for the fraud they know it to be. Instead they will sell an all-day transit pass for $3.50 a day - and you can ride any bus or light rail. Without the massive taxpayer subsidy, almost no one would ride the light rail. Why? Because its average speed is projected to be 21 miles per hour and it takes far LONGER to travel on light rail than it does to travel in our congested roadways - even during peak usage times.

  8. Mesa Econoguy:

    According to the leftist school of communal economics, the more we pool resources, and the more we build collective transport systems/utilities/healthcare delivery systems/insert cause-du-jour here, the less it will cost, and the better off all of us will be.

    You see, as we scale up public expenditure, the incremental cost of building everything for everyone becomes miniscule, and operating costs decline dramatically, due to economies of scale. This is especially true of government, which is the most efficient administrator and operator of large-scale projects, like health care.

  9. Hasdrubal:

    I think the difference between Chris's and Maddog's analyses are the assumptions about ridership. It looks like Chris assumes "roll[ing] light rail out to every urban commuter" implies converting all commuters to riding light rail. So you would take advantage of the nearly 0 marginal cost of extra riders for an appropriately sized light rail project to lower the cost per rider mile.

    Maddog, on the other hand, seems to be looking at expanding light rail while keeping other commuting options in place. There's no reason to believe that light rail will become significantly more competitive than it is now, requiring higher and higher subsidies as it gets pushed into lower and lower population densities.

    I think Maddog's analysis is more realistic: I don't see cities banning cars any time in the foreseeable future.

  10. Craig:

    "as we scale up public expenditure, the incremental cost of building everything for everyone becomes miniscule, and operating costs decline dramatically, due to economies of scale. "

    Ah, yes. Economies of scale. The only economic principle that the left will admit to knowing -- especially when it involves subsidising their pet projects.

  11. Maddog:

    Transit ridership since 1980 has been decreasing precipitously. In Portland transit accounts for about 1.4 out of every 100 trips in the metro area and Portland does pretty well nationally. The number is insignificant. Light rail costs are huge. These high costs in light of declining ridership are a red flag for serious problems as they require large and increasing public subsidies.

    Light rail did not move people out of cars, it moved them from existing bus routes to light rail at a ten to twenty time cost multiple. This was a cost increasing change not a real structural change in commuter ratios.

    The only time transit gets a break is when the economy is down, and gas prices up in the $4-5 per gallon range.

    Portland has spent the past two decades densifying and building light rail, streetcar, tram, commuter rail while dismantling its bus service. The result is declining ridership and spiraling cost. The problem is wealthy people don't want to cram onto a bus, streetcar, light rail, tram or commuter rail cattle car and ride around at 15 miles per hour making a forty minute slog out of a twenty minute driving commute. And we are all wealthy today. The lower class today lives better than the middle class of 1970 and we want amenities to match.

    The post was about providing light rail transit to ALL COMMUTERS and presumably that did not mean move all commuters into cities with existing light rail lines but extending light rail to these communities. Extending light rail to low density communities would make today's foolish expenditures on light rail look brilliant in comparison. It is difficult to divine how passenger per mile ridership levels could increase when extending light rail to low density towns and cities.

    Lastly, don’t forget that the $2 per passenger mile figure does not include rebuilding, replacement, maintenance or operating costs. The real figure should be about $5 per passenger mile when including these costs but no sane commuter would pay anywhere near these prices to commute so taxpayers must make these payments. We would be better off if we simply leased low priced high fuel economy autos for full time commuters and paid for their fuel to commute (I don’t advocate this). The costs would be lower, pollution would be lower, and carbon use would be lower. Plus mobility causes economic prosperity so we would have that as a side benefit.

  12. Danny:

    Actually, transit ridership has been growing at about twice the rate of population growth since about 1994. And maintenance and operating costs are most definitely included in that figure. With track rebuilding happening maybe once every 80 years or so, and rolling stock lasting between 30 and 50 years, depreciation costs are pretty comparable with buses. It is the upfront construction and purchase costs that are painful and for the most part unnecessary.

  13. MJ:

    Putting more riders on the same rail system lowers subsidies, not increases them.

    I don't think you understand the relationship between marginal cost and total cost.

  14. MJ:

    One of his odd findings was that prior to building light rail transit agencies used less motor vehicle fuels per passenger mile than they did after building light rail. Since light rail uses electricity this was a hard to understand but important finding.

    Actually, this is not surprising at all. If your measure is motor vehicle fuel use, it should decline, since 1) trains (electric) will now be doing the work that buses formerly did, and 2) formerly productive bus lines will be converted into rail feeders, making them less productive and hence more energy intense (per passenger-mile).

  15. Tyme:

    Interesting that Danny mentioned the Calgary light rail system. Living in Calgary, after reading an earlier blog on this site, I had a look at a 2005 report (the most recent I could easily find) for our system.

    Link here: http://www.calgarytransit.com/pdf/Calgarys_LRT_1st_25Years_TRB_revised.pdf

    Doing some rough math using the report's ridership and operating cost figures, and taking their $1BB in development costs and calling it $1.5BB in today's dollars (they started building it back in the mid 70's), a 30 year payback at 5%, I came up with about $1.65 per rider in combined operating and capital costs.

    Ticket costs are about $2.50 per ride. Could it be that this system is actually turning a profit? If so, perhaps the secret to a profitable LRT system is to crank your downtown parking costs sky high (Calgary has previously been rated is THE most expensive city in North America to park). This is not necessarily a recommendation ...