Transit Time: New study says transit plan would generate billions, but ...
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Economic impact report finds high cost of ‘doing nothing’ on traffic congestion, but it’s short on several key details
by Steve Harrison
The Charlotte Regional Business Alliance presented a report Tuesday that estimated the economic impact of the city of Charlotte’s proposed $13.5 billion transportation plan, saying the metro area would lose $28 billion in economic output by 2050 if traffic “congestion isn’t addressed.”
But the study also left out details, such as whether the transportation plan would actually relieve that congestion. It also didn’t explore whether the money could provide more benefits if spent in other ways, such as by emphasizing greenways and roads instead of light rail.
And the study didn’t factor the impact of planned improvements to existing roads, and how that might improve traffic flow.
The city of Charlotte is proposing the $13.5 billion plan to improve economic mobility, relieve congestion and reduce greenhouse gases. Most of the money would be spent building a new light-rail line from Matthews to Belmont; a commuter rail line to Lake Norman; and to expand bus service.
There also would be money for greenways, sidewalks, bike lanes and roads.
The Business Alliance has taken the lead in running the political campaign for the plan, which would need a penny increase in the sales tax. Mecklenburg County could vote on the tax next year.
“The point of the study is to inform what is done and make sure we are being smart about it and to evaluate all types of transit,” said Janet Lebar, the CEO of the Business Alliance. “And we’re excited about what the study shows and hope that the rest of the region through our conversations and collaborations is really going to get us to a point where we just aren’t doing nothing.”
The Business Alliance has hired a heavy-hitting lobbying team led by Republican Paul Shumaker and Democrat Morgan Jackson of Raleigh.
The Alliance paid N.C. State’s Institute for Transportation and Research Education (ITRE) $42,500 for the study, which will be used to convince voters and elected officials of the plan’s merits. UNC Charlotte’s Urban Institute also worked on the report. (Disclosure: The Urban Institute is a partner in producing the Transit Time newsletter but played no role in the writing or editing of this article.)
It’s unclear if anyone will be convinced by the study, especially Republican legislative leaders in Raleigh, whose approval is needed to place the sales tax referendum on the ballot. Economic impact studies are often criticized by experts as exaggerated or even preposterous.
Behind the numbers: Daniel Findley, a senior research associate at ITRE, said the study’s authors used an economic forecasting model called IMPLAN. He said it showed that if congestion isn’t addressed, the Charlotte metro area would lose out on up to 126,000 jobs, $10.1 billion in wages and $28 billion in economic output by 2050. The study then suggested the city’s transportation plan would recoup those losses.
The study found that the Charlotte region could lose out on the creation of up to 109,000 direct jobs by 2050, and 126,000 total, “if congestion isn’t addressed.”
The report looked at the economic impact of every $100 million spent on various modes of transportation and then extrapolated those benefits over the entire $13.5 billion plan.
But the report made several assumptions that weren’t supported by data:
◼️ The report never showed that the transportation plan will take cars off the road.
For instance, the Red Line commuter rail line to Lake Norman is part of the plan. There is nothing in the report that looks at how many cars are expected to be on Interstate 77 over the next 30 years, and how many vehicles would be taken off the highway if the train were built.
The same is for the Silver Line, which would run along Independence Boulevard and Wilkinson Boulevard. There is no detail on how many cars it would take off those roads.
The idea appears to be that if you build it, then riders were come. But even after two decades of having the half-cent sales tax for transit, the percent of people in Charlotte commuting to work by transit is 3.4%. That’s below the national average of 5%.
And even before the pandemic, transit systems were struggling. In Charlotte, the number of bus riders peaked at 23 million annually in 2013. In 2019, ridership had fallen to 14.5 million.
◼️ The report doesn’t consider alternative ideas for spending money.
It doesn’t explore, for instance, the impact of spending more money on bikes lanes as opposed to, say, building light-rail. It also doesn’t consider the economic impact of building more roads, even though the report showed the roads and highways produce more economic activity than any other mode of transportation in the plan.
“We didn’t do more of an opportunity costs (study), where you have one pot of money and (decide) where should we best spend that,” Findley said.
During the virtual presentation, there was a question from Greg Boulanger, a vice president with HNTB, an engineering and construction firm that builds roads as well as transit. He noted that the study showed roads and highways produced the most economic impact, and then asked why Charlotte shouldn’t spend more money on roads?
Roads are only a small fraction of the $13.5 billion plan.
Findley essentially said that roads may have more economic impact, but that Charlotte already has enough roads, and that it’s important to have choices.
“Our study does show they have a slightly larger impact although I do want to mention that a lot of that relates to our existing paradigm because we have a land use and transportation system that’s built around the automobile,” Findley said, adding that that may change.
◼️ The study considers only all vs. nothing.
The study compared the Charlotte metro area under the $13.5 billion plan to the region in what it called a “do nothing” scenario. And LeBar referred to the status quo as “doing nothing.”
But a “do nothing” scenario is not realistic.
The N.C. Department of Transportation has budgeted hundreds of millions of dollars on highway projects over the next decade. It’s building express toll lanes on Interstate 485 in south Charlotte. The state has budgeted money to widen Interstate 77 in south Charlotte and add toll lanes this decade. It also plans to add express lanes to Independence Boulevard.
And the city of Charlotte is going to use bond money to build sidewalks, greenways and bike lanes over the next decade. It’s also building the Gold Line streetcar.
When asked about those specific projects and how much economic activity they would generate, Findley said he didn’t know the details.
Findley was asked whether the pandemic and having more people work from home could change those projects. He said ITRE accounted for that by also having a “low projection” of economic impact, though it’s unclear if the group did a specific analysis of how people working virtually would impact the transit plan.
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It’s certainly true that the $13.5 billion plan would stimulate the economy. There would be the obvious winners: Construction firms and engineers, for one. And there would likely be other winners, like developers building apartment complexes near train stations.
And some people would save money on gas and parking.
But not having a penny sales tax increase could also create economic activity as well. The city of Charlotte’s own projection is that the penny sales tax would generate nearly $14 billion in total revenue by 2050.
Some of that tax money would come from people who live outside the region. But if people in the Charlotte metro area were allowed to keep that money and spend it on clothes, meals or appliances, that would also create a ripple effect through the economy, possibly equaling the $28 billion impact cited by ITRE.
Steve Harrison is a reporter with WFAE, Charlotte’s NPR news source. Reach him at sharrison@wfae.com.
Countdown to Gold Line streetcar opening continues
In brief…
Transportation planning: The city’s transportation department is continuing to hold a series of neighborhood “listening sessions” this week and next week on transportation goals. Find out more.
On verge of litter collection record: The N.C. Department of Transportation says it has collected 9 million pounds of litter from roadsides and expects it will surpass the record of 10.5 million pounds, set in 2019. (NCDOT)
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