Half-cent sales tax
increase to spur major investment in transit.
Civic CaucusFocus on CompetitivenessInterview March 29, 2013
David Broden, Janis Clay, Pat Davies, Paul Gilje, Susan Haigh, Adam
Harrington, Randy Johnson, Dan Loritz (chair), Paul Ostrow, Dana
Schroeder, Clarence Shallbetter, and Meredith Salsbery
Summary of Discussion:
Today's meeting has two major objectives: (1) developing an
understanding of Governor Dayton's proposal to the 2013 Legislature
for a one-half cent increase in the state sales tax for transit in the
seven-county metro area, and (2) looking specifically at how that
proposal if enacted would reduce the number of people who drive alone
to and from work each day.
Participants introduced themselves. Dan welcomed Susan Haigh, chair,
Metropolitan Council. Haigh has been chair of the Metropolitan Council
since January 2011. She also currently serves as the president of Twin
Cities Habitat for Humanity. Prior to joining Habitat for Humanity in
2005, she served ten years as a Ramsey County Commissioner and twelve
years as a chief deputy county attorney.
Haigh has received the Spurgeon Award from
the Boy Scouts and the Distinguished Citizen Award from Macalester
College for her community service. She is a passionate advocate for
affordable housing and led successful efforts to create housing
endowment funds with her congregation and with Ramsey County. She has
a BA in Political Science from Macalester College and a JD from
William Mitchell College of Law.
The Metropolitan Council
was created by the Minnesota Legislature in 1967 to coordinate
planning and development within the Twin Cities metropolitan area, and
to address issues that could not be adequately addressed with existing
governmental arrangements. Additional legislation in 1974, 1976 and
1994 strengthened the Council's planning and policy roles, and merged
the functions of three agencies (the Metropolitan Transit Commission,
the Regional Transit Board and the Metropolitan Waste Control
Commission) into one - the Metropolitan Council. For more information
Governor Dayton's transit proposal.
Haigh's comments on the transit proposal and in discussion with the
Civic Caucus the following points were raised:
1. Details of the proposal.
Dayton is proposing a one-half cent increase in the sales tax for
transit in the seven-county metropolitan area (Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott and Washington Counties). A one-quarter cent
sales tax for transit is currently in effect for five of the seven
counties (except Carver and Scott Counties). The additional tax would
bring in an estimated $230 million annually. With that revenue, Haigh
said, the following will be possible:
Payment for the state share of construction of new light rail
transit (LRT) and bus rapid transit (BRT). Assuming a 50 percent
participation in construction by the federal government, this
increase in revenue will pay the state's share of the Southwest LRT
from downtown Minneapolis to Eden Prairie, the Bottineau LRT from
downtown Minneapolis to Target Headquarters in Brooklyn Park, the
Gateway (LRT or BRT) from Woodbury to downtown St. Paul, BRT on
I-35W from Lakeville to downtown Minneapolis, and up to 12 new
arterial BRT lines or streetcar lines, and as many as five new
highway BRT lines.
Full coverage of the annual difference between operating
expenses and fare box income.
A one percent annual increase in the base bus system (more
routes, greater frequencies, and longer service hours).
2. BRT and arterial BRT explained.
functions as LRT, except it's much cheaper; buses with enhanced
features are given an exclusive lane or managed lane on the freeway
which improves operating speed and reliability. One could say that BRT
is LRT with rubber tires on the freeway instead of steel wheels on
rail. The metro area's first BRT line opens in June 2013 from
Lakeville to the Mall of America. BRT buses are deemed to function as
main line vehicles, with passengers in collector buses from other
locations transferring when they arrive at a BRT station.
Arterial BRT would be higher level transit
service on non-freeway arterial streets, ranging from street like
Snelling Avenue in St. Paul (
BRT and Arterial BRT cost far less per mile
than LRT, and will provide frequent, fast and reliable service and
have similar features at stations as LRT, with real time schedule
information for customers, ticket vending machines and enhanced
waiting shelters, Haigh said. As demonstrated by Healthline in
Cleveland, BRT can attract some of the same economic benefits as rail.
The question of proposed streetcars came up,
which may not provide the same speed advantages as Arterial BRT,
according to Adam Harrington, assistant director, route and systems
planning, for Metro Transit. Harrington said the analysis of
streetcars compared to other alternatives is taking place in the
Midtown Corridor along Lake Street in Minneapolis, Nicollet and
Central Avenues in Minneapolis and Robert Street in St. Paul and West
St. Paul. The City of St. Paul is currently evaluating the potential
for streetcars in a variety of environments in the city.
3. Current service levels in jeopardy.
Without additional state revenue, current service levels
could not be maintained in the longterm, and the Southwest LRT could
not be built, Haigh said.
4. Advantage of sales tax proposal.
financial shifts and gimmicks to maintain and operate transit would no
longer be needed, she said. Transit expansion is fundamental to
growing Minnesota's economy and jobs. The Governor's proposal is
consistent with the Transportation Finance
work over the last year. Committee chairs in the House and Senate are
excited about the plan. Their specific bills are expected to be
introduced this coming week, Haigh said. A more ambitious transit
proposal, calling for a 3/4 cent increase in the sales tax for
transit, has been proposed by Transit for Livable Communities and its
5. Metro area community support is evident.
Haigh noted that 79 percent of respondents in a poll
conducted in January 2013 by local Chambers of Commerce "would benefit
from having an expanded and improved public transit system, such as
rail and buses."
6. Competing metro areas are moving ahead.
distributed a chart showing that many other cities in the United
States have dedicated sales taxes for transit that exceed the present
1/4 sales tax for transit in the Twin Cities area, for example: 3/4
cent, St. Louis, and 1 cent in Atlanta, Boston, Cleveland, Dallas,
Denver and Houston.
LRT systems are increasingly being
recognized as essential components of great metropolitan areas, Haigh
said. She noted that workers in the millennial generation (those born
approximately between 1983 and 2000) are much more inclined than are
older workers to ride transit to and from work, giving them more
opportunities to use personal communication devices while traveling.
7. The permanent investment of LRT will
stimulate more development near stations.
When rails are
laid down and LRT stations are built, such a transit improvement is
permanent at that location. By contrast bus routes and stops don't
offer the same degree of permanence. Thus, LRT is a positive
guarantee to developers investing major dollars in housing, business
and industry that LRT will still be there as they recover their
investments, Haigh said.
8. Thousands of jobs are created by transit
Haigh distributed data indicating that
more than 4,000 workers have been employed by the Central Corridor LRT
project and that the Southwest LRT is expected to employ more than
Encouraging greater use of mass transit.
the discussion of the transit budget proposal, Haigh turned to the
subject of the Council's success in encouraging people to use transit
rather than drive alone to and from work. The group weighed LRT's
potential both (1) to entice workers to leave their cars at home and
(2) to provide urgently needed access to jobs for people who can't
afford their own cars. If enough drivers get out from behind the
wheel, rush hour congestion and air pollution are reduced. With better
ways to get to work, low-income people, particularly, could see a
significant increase in the number, types, and location of jobs they
The work trip is bread-and-butter for
transit. It's the vital link for people's livelihood. It might be the
most repetitive, routine, and maybe even most lengthy trip each day.
It certainly is the trip that dominates congestion in morning and
evening rush hours.
A participant commented that the challenge
for the Twin Cities metro area is considerable. About 81 percent of
all work destinations in the seven-county metro area are today reached
by people driving alone; another 9 percent carpool, and another 5
percent use transit, according to the American Community Survey of the
U.S. Census Bureau. For work destinations within the city of
Minneapolis, about 64 percent drive alone; 10 percent, carpool, and 19
percent, take transit. For work destinations within St. Paul, about 77
percent drive alone; 11 percent, carpool, and 6 percent take transit.
Data for work destinations over 24 hours are similar to data for 6-9
a.m., according to the Census Bureau. During the discussion on work
trips, the following points were made:
1. Impact of LRT on getting people to work
Haigh said the Central Corridor LRT would connect people to 280,000
existing job locations, and growing to 345,000 in the future.
Southwest LRT would connect people to 210,000 corridor jobs now,
growing to 270,000. A connected job is identified by the Metro Council
as a job located within a certain distance of a transit station. The
jobs connection numbers are deemed important because many more workers
in the future would be expected to take LRT from the city to suburbs
as well as suburban workers reaching the LRT directly by
part-and-ride, feeder bus or some other means.
Haigh offered an example of the potential
home-to-work opportunities using LRT: a worker in the Frogtown
neighborhood in St. Paul could walk or take a feeder bus to a Central
Corridor "Green Line" LRT station, ride the Green Line to downtown
Minneapolis, and continue riding the Green Line for a job at United
HealthCare headquarters in Eden Prairie. A participant observed that
success is closely related to how much time elapses between leaving
home and arriving at the job. The participant cited lower income
neighborhoods in central cities where the number of minutes to
suburban work is very substantial, because of length of time required
to take a bus downtown, transfer to LRT, and ultimately get from the
suburban LRT station to the place of work.
Census Bureau data indicate a comparatively
small number of workers now use reverse commuting (taking LRT or bus
from the city to the suburbs) today. Of approximately 1 million jobs
located in suburbs of the Twin Cities, fewer than 2 percent of workers
take transit to work in those suburbs, according to the U.S. Census
Bureau. A transit trip usually will take longer. About 63 percent of
all trips to work in the Twin Cities area take less than half an hour,
while 32 percent of trips on transit take less than half an hour,
according to the Census Bureau.
Harrington noted that this speaks to the
economic challenge of attracting customers to transit when they have a
choice of driving - even in a high maintenance vehicle. The
strength in serving core cities with transit is in the geographic
concentration of jobs, focused traffic congestion and expense for
parking. This environment makes transit efficient and an
attractive alternative to driving. Conversely, in the suburbs
jobs are not geographically concentrated at the same level, employees
are originating from all points of the compass, and parking is usually
plentiful and free.
2. Most job locations are outside the
. A participant observed that not more than 10
percent of all Twin Cities area jobs are located in downtown
Minneapolis, and not more than 5 percent are located in downtown St.
Paul. Transit routes, existing and proposed, are focused heavily on
Note from Metropolitan Council staff:
Another 21 percent of jobs are in Minneapolis and St. Paul cities, but
outside of the downtowns. In total, the suburbs have twice as many
jobs as the two central cities, but those jobs cover 10 times as much
land area. Lack of density presents challenges to providing
cost-effective transit service in suburban areas.
A workable fixed route transit system is in
place serving corridors in all directions leading to the two
downtowns. The Metro Council now is in the process of upgrading many
of those corridors with LRT and BRT. Thus service to the downtowns
will be enhanced. Such enhancements could help whatever development,
residential or business, occurs in those corridors, provided people
choosing transit can easily reach their destinations and get back home
again in reasonable time. Haigh said some $1.2 billion in building
permits have been taken out along the Central Corridor.
3. Importance of economic factors in
. During the discussion the importance of
economic factors in adding or upgrading bus or LRT routes was
highlighted. The Metro Council is free to add any number of routes,
along with feeder buses, provided improvements will attract enough new
fare-paying riders. Responding to a question, Haigh said that fare box
income covers about 29 percent of transit operating expense in the
Twin Cities area, a recovery rate, she said, that exceeds that of many
other cities in the United States. The difference between fare box
recovery and total operating expense is picked up by taxpayers.
Transit operators can't add uneconomical routes or they'll exceed
It was noted that one measurement of
economic factors in transit would be to calculate the average capital
cost and average operating cost for every new rider attracted.
4. Uncertainty over potential success in
converting drivers to riders.
With homes and jobs widely
dispersed over the metro area--and with trip patterns appearing more
like a ball of yarn than spokes on a wheel--discussion moved to how
many persons who now drive to work alone will shift to transit under
the Metro Council's plan.
Some bus riders will become LRT riders,
which--depending upon the cost of feeder buses--might produce
economies of scale because of transit salary savings (one LRT train
serving hundreds of patrons versus one bus with 50 patrons.) Some bus
routes might be eliminated with all patrons expected to transfer to
LRT. But that move has some potential downside. In the Central
Corridor, for example, removal of express buses on I-94 could increase
travel time between the downtowns. (Note: Bus route changes expected
when Central Corridor opens can be viewed here:
Some carpoolers might shift to LRT. A participant mentioned another
example, concerning one of the bus routes (No. 16) that runs along
University Ave. in St. Paul, the same route as Central Corridor LRT.
The No. 16 bus traditionally has had the highest ratio of fare box
income to operating expense, the participant said. That ratio could
drop as No. 16 passengers choose LRT.
Responding to questions, Haigh did not
speculate about the number of people now driving alone who will choose
transit as the Metro Council's plan is implemented. The Metropolitan
Council has a goal of increasing overall transit use from 5 percent of
all trips to 10 percent of all trips in the metro area by 2030.
5. Transit improvements help people of all
incomes, not just the poor
. In response to a participant's
comment about the need to develop job opportunities in all types of
jobs, for all incomes, Haigh again noted the interest of a younger
generation of workers who by riding can make more effective use of
their time, utilizing their personal electronic devices.
6. Subways are too expensive
Responding to a question, Haigh said underground tunnels are far too
expensive relative to potential ridership. This was clearly
demonstrated, she said, when estimates were made for tunneling through
the University of Minnesota campus.
7. Potential to serve areas being considered
for major development.
A participant wondered how some
10,000 or more workers could use transit get to their jobs if a major
development proposed along the Mississippi River in north Minneapolis
were approved. Haigh replied that the Metropolitan Council in its 30
year plans keeps as close tabs as possible on sites being considered
as major employment centers. The Council often provides cities with
financial assistance when major projects are considered.
Closing and thanks:
In a closing comment,
Haigh noted that the question of water supply is going to become a
major problem for the Twin Cities area in coming years. She urged the
Civic Caucus to consider an interview on that topic. On behalf
of the Civic Caucus, Dan thanked Haigh for meeting with us today.
The Civic Caucus
is a non-partisan,
tax-exempt educational organization. The Core participants
include persons of varying political persuasions, reflecting years of leadership in politics and
business. Click here
to see a short personal background of each.
David Broden, Janis Clay, Bill Frenzel, Paul Gilje,
Jan Hively, Dan Loritz (Chair), Marina Lyon, Joe Mansky,
Tim McDonald, John Mooty, Jim Olson, Wayne Popham and