Streetcars and urban renewal: Rolling blunder

LATE and over budget, streetcars are finally rumbling to life in Washington, DC. The long-awaited service, which has cost at least $135m to build, spans 2.4 miles along H Street in the city’s north-east. But it is not taking passengers yet. Operators are still learning how to drive the electric trains, which may come into service by the end of the year. In the meantime, locals can hop on the bus: plenty of them already ply this route, and often at a faster clip.

Most American cities paved over their streetcar tracks decades ago, deeming the services slow, rickety and inconvenient. Commuters have long preferred cars and buses. But streetcars—sometimes known as trolleys or trams—are making a comeback. Services are rolling out in at least 16 American cities, with dozens more in the works. Even bankrupt Detroit has begun work on a three-mile line that is expected to cost $137m.

Fans say streetcars create jobs and spark urban investment. Developers like them because they run on fixed tracks, which means official commitment to a route is locked in. Boosters point to Portland, Oregon, which unveiled America’s first streetcar line with modern vehicles in 2001. One study found that the city’s westside line attracted new business and housing valued at more than 24 times its construction cost. Plans in Atlanta and Tucson have similarly generated hundreds of millions of dollars in private investment and raised property values. The District’s H Street neighbourhood has been moving upmarket for years, but some credit the promise of a streetcar with accelerating development.

Others are more sceptical. The relationship between streetcars and development is not clear, say researchers funded by the Federal Transit Administration (FTA). In cities where streetcars have led to urban renewal, they are part of larger, heavily subsidised development plans, with changes in zoning, improvements to streets and other upgrades. And while streetcars are cheaper than other rail projects, they are still costly to build and maintain. Operating expenses are more than twice those for buses, according to data from the FTA, and capital costs are hefty. Tucson’s project, for example, cost nearly $200m and opened years late, in part because the city had to clear utilities from under the tracks, install overhead electrical connections and repave much of the four-mile route.

All this investment might make some sense if streetcars offered an efficient way to move people around. But here, too, the evidence is flimsy. Unlike European trams, which often cover long stretches in independent lanes, American streetcars tend to span walkable distances and share the road with other vehicles. This means they inch along with traffic, often at less than 12 miles per hour, on tracks that make it impossible to navigate busy streets or ride around obstacles. Indeed, their slow speeds and frequent stops mean they often cause more congestion. A bus route could move up to five times more people an hour, says Randal O’Toole of the Cato Institute, a think-tank.

If streetcars are so slow and costly, why are there suddenly so many? Because federal subsidies have encouraged them. Under Barack Obama the Department of Transportation has made grants of up to $75m available to “small” projects that promise to revitalise urban areas and cut greenhouse-gas emissions. They need not be cost-effective in the conventional sense if they make a place more liveable or offer other vague benefits.

America’s streetcar revival is gobbling up funds that might otherwise go towards cheaper, nimbler forms of public transport, such as buses. This is not only wasteful, but tends to favour better-off riders, such as tourists and shoppers. Poorer residents are mainly served by buses, if at all, says Daniel Chatman of the University of California, Berkeley, who studies regional planning. “The economics of many light-rail and streetcar projects is abysmal,” he adds.

Well-designed bus routes can spur development, too, and at far lower cost, says Adie Tomer of the Brookings Institution, a think-tank. According to the Institute for Transportation and Development Policy, another think-tank, Cleveland’s rapid-bus service has attracted $5.8 billion in private investment along its 6.8-mile route. It was built in 2008 for around $50m—just a third of the cost of the District’s streetcar.