Over the last ten years there have been a number of cities across the country that have pursued streetcars as a method of economic revitalization. The two scenarios that have been the backbone of the streetcar movement have been in Portland and Seattle. Both of these cities have claimed overwhelming positive results with increasing property values, increased marketability for local businesses, and an increase in the development of depressed areas. Most of these projects are paid through an increase in the cities’ property taxes and federal grants, which are ultimately paid for with local and federal tax dollars. Unfortunately the city of Charlotte will not receive any federal grants this year to extend their streetcar, even with former-mayor Anthony Foxx as the new U.S. Secretary of Transportation. So, is that a telling sign that Charlotte’s streetcar isn’t as important as some city council members believe? Or maybe in the aftermath of a recession, city leaders need to focus on economic growth and not economic development.
Many believed the streetcar controversy in Charlotte was over when Foxx was named the new U.S. Secretary of Transportation. That changed this week when Charlotte’s plans did not make the latest list of projects receiving funding from the federal agency. Phase 2 of Charlotte’s streetcar is estimated to cost $126 million, of which reserve funds will pay for half and federal grant money for the other $63 million to keep from increasing property taxes. Since the federal grant was not accepted, Phase 2 is at a standstill until city leaders apply for another federal grant or find another way to come up with $63 million.
The City of Charlotte needs to remember that economic development (streetcars) is not the same as economic growth. Cities and counties should pursue a policy of sustained economic growth, which makes the possibility of investment attractive to all businesses, not of targeted economic development. Local government has a role in society, to provide sound and reliable infrastructure services. This comes in the form of effective police and fire departments, efficient trash collection, a dependable sewer system and water supply that can accommodate future economic growth, etc. Streetcars do not fall into that category and don’t create an environment that is conducive to investment in business activity for all, just a politically favored few that happen to be located in downtown or along the streetcar line. Streetcars are targeted and not for the overall benefit, thus additional tax dollars (whether it be local property taxes or federal tax dollars in the form of a grant) should not be spent on something that is not a need to the city. Some great examples of already failed attempts at targeted economic development in Charlotte are the NASCAR Hall of Fame and the US National Whitewater Center, now there is another to add to the list.
