Government projects which are not market driven by real needs, tend to misuse tax dollars. Milwaukee’s streetcar “The Hop” is an extreme example of wasting our Federal and Local tax dollars.
The Hop uses Federal Tax dollars, which seem to be designed to jump start projects with “free” money. In the process they help create the problem. Alderman Borkowski “one of the most outspoken opponents of The Hop from its inception, is warning Milwaukeeans that the streetcar is going to be a “financial anvil around the city of Milwaukee’s neck” for the 23-year length of the deal that the city made when it grabbed all that “free” federal money.”1
Federal Tax Dollars tend to be in the stratosphere. “The initial capital costs of The Hop were funded by a $69 million grant from the Federal Highway Administration Congestion Mitigation and Air Quality Improvement (CMAQ) Program and $59 million in property tax revenue diverted from three tax incremental financing districts. Operating costs are an additional expense.”1
$69 Million Federal Tax dollars plus $59 Million Local Tax dollars equal $128 Million as the total initial Capital Cost.
Add in the Operating Costs “…in those latest Federal Transit Administration numbers, The Hop cost $15.03 per ride in operating expense…”2 “Despite The Hop still being fare-free — no fareboxes are even installed — it has only half-recovered, with 372,000 passengers last year.”2
The dollar figure for Operating Cost is 372,000 passengers in 2022, times $15.03 cost per ride equals $5,591,000. The passenger number and the accompanying operating costs are low since we were coming out of the Covid shutdowns.
2022 averaged just 1,019 passenger rides, and all those passengers paid no fare at all. This whole project seems to be designed to spend money. There seems to be no regard to balance the costs in any way with results.
The Hop is expensive. And it becomes even more expensive when we understand, there was no original need for The Hop. Jeff Polenske, Commissioner of Public Works said “MCTS rerouted routes 15 and 30 as part of the system’s construction to avoid duplicating service.”3
The Hop was 100% un-needed! Since, two buses were already servicing the very route The Hop currently services.
Transit buses have much lower Capital costs and lower Operating expenses. The City of Milwaukee is spending lots of money on streetcars with no regard for our Federal Tax dollars, or local taxes.
Yet City of Milwaukee officials, including the mayor are firmly dedicated to expanding “The Hop” Milwaukee’s Streetcar. It was approved in 2015 by the Milwaukee Common Council. It currently is running on 2.1 miles of track, which is a “starter route”.
A Milwaukeean, “Lennora Jules said she would ride it if it went places she needed to go. I do not necessarily need to go from the Greyhound station or the post office to Milwaukee Public Market” Jules said.”4
“From there to there,” Lucile said about the Hop’s current 2-mile starter route. “What’s the point?
That’s why the Commissioner of Milwaukee Department of Development, Lafayette Crump, wants to triple the size of the current streetcar system.”4
The City of Milwaukee plans to add 2.4 miles of track which “will position the City to receive up to $80 Million in matching federal funds through a predictable federal program used by transit systems across the country.”3 Surely this expansion will be sold to Milwaukeeans that they will lose $80 Million in “Free” money, if The Hop is not expanded.
In February 2022, Jerrel Kruschke, the current Commissioner of Public Works, and previous engineer, “complied a list of stimulus bill candidates” for President Biden’s trillion-dollar infrastructure plan.”4 “…which also included $353.8 million for streetcar extensions.”4
In conclusion, our Federal Government uses Federal Grants for Capital expenses, which come from Federal Taxpayers, to jump start unneeded projects. This starter money adds local taxes to cover more capital and operating expenses. This same funding system is used to expand the unneeded project, which is the definition of being wasteful.
Sources:
Footnote 1 “The Hop Federal Monies Create a Financial Anvil for Milwaukee”, November 19, 2020 Badger Institute, by Mark Lisheron, https://www.badgerinstitute.org/the-hop-federal-monies-create-a-financial-anvil-for-milwaukee/
Footnote 2 “Legislature Protects Milwaukeeans From 15 Per Rider Fare Free Trolly Folly” May 11, 2023 Badger Institute by Patrick McIlheran, Director of Policy at Badger Institute
https://www.badgerinstitute.org/legislature-protects-milwaukeeans-from-15-per-rider-fare-free-trolley-folly/
Footnote: 3 “Should Milwaukee Stop The Hop” October 13, 2020, Urban Milwaukee, by Jeramey Jannene
https://urbanmilwaukee.com/2020/10/13/transportation-should-milwaukee-stop-the-hop/
Footnote 4 “$355 Million Milwaukee Streetcar Expansion Planned: Funding a ‘Challenge’”, June 7, 2023 Fox 6 News, Milwaukee, By Reporter Bryan Polcyn
https://www.fox6now.com/news/milwaukee-streetcar-expansion-funding-challenge
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