Commentary: Transit is about creating jobs, not ideology

By Roger Caron, President, Racine Area Manufacturers and Commerce and
Jeff Van Koningsveld, President, IBEW Local 430, and co-chair of the Racine Transit Task Force

Transit is about economic growth and jobs – JOBS, not ideology.

If we want jobs and a stronger economy, we must pass Regional Transit Authority legislation in Wisconsin and not let politics hinder progress and prosperity. Let’s take constructive action that will build us up as a county and region.

Lower the volume on all the fear and misinformation and an alarming fact still rings clear: we have the second highest unemployment rate in the state. There’s no denying that we must do something about jobs and unemployment.

Nor can we deny government’s responsibility to serve the people. All transportation modes, not just roads, are the responsibility of government. Individuals can’t get our faltering bus system in order; our leaders must. The only way we can effectively develop the transit we need to strengthen our economic future is through cooperation and a regional effort.

Racine CEOs testified at an Assembly hearing in Madison recently that passing RTA legislation would be the single most productive action our representatives can take to impact job creation and cultivate economic growth while also allowing us to adequately fund bus service, the cornerstone of any regional transit system.

Ideological differences and political positioning are creating an environment that’s hindering wise investment of our resources in transit projects that leverage significant private dollars and federal funds to create jobs and get people connected to jobs. Left unused, this federal money goes to other states and regions. Isn’t it time we started to finally get our fair share of the dollars we send to Washington?

Besides allowing us to improve deteriorating bus transit, the RTA bill is necessary for securing federal funding for KRM commuter rail, which would network with buses to expand connections to economic opportunities in other areas. KRM will also help make us more competitive with places such as Minneapolis, St. Louis, and other peer metro areas in attracting jobs and businesses.

For the short term, simply building the KRM line, along with projected growth around the project, will create nearly 4,700 jobs. In addition, KRM will help support the creation of another 71,000 jobs linked to both short- and long-term development.

Although these jobs are in and near Racine and along the KRM corridor, they impact everyone. The people working them will be from all parts of the county. And, as the Southeastern Wisconsin Regional Planning Commission notes, everyone will gain access to over 1 million jobs within the Chicago-Milwaukee corridor as a result of better bus connections and KRM.

Some people have voiced doubt about KRM ridership projections of over 2 million passengers a year. Ridership figures are modest and based on years of highly scrutinized studies. The projection methodology and formulas (required by the Federal Transit Administration) are purposely very conservative. Ridership results for most new transit line using the same required methodology have exceeded estimates far sooner than expected, as evidenced in Phoenix, Charlotte, Minneapolis and many other metro areas.

Looking at other areas shows there are tax base benefits too. For example, in addition to helping create 91,000 permanent jobs by this year, Metrorail in Northern Virginia will also generate 2.1 billion in tax revenue, 26.8 million square feet of commercial development, and 31,000 additional residential units, according to the Urban Land Institute.

And while the naysayer might note Racine is not Northern Virginia, nor are we some dustbowl town with no vision and no future – that is unless we choose to let ideological bickering and political acrimony get in our way.

Locally, KRM train stations, including two here in Racine County, are projected to similarly spur increased property values by an estimated $7.8 billion and generate $750 million increase in retail sales over 25 years.

And the public decidedly favors RTA passage. That hearing in Madison we mentioned earlier drew a broadly representative overflow crowd, many of them from our local communities, and yielded seven hours of testimony. Just one person voiced only mild opposition, a clear indication that this is not a partisan issue. Why make it one?

Let’s tell our legislators to get the RTA bill—a jobs bill—done now. We all need to stand up and support our legislators that advocate for this very important, forward-thinking legislation!

State: Fees cover costs for RTAs, so no cost for RTAs

When a bill is introduced in the state Legislature, the Legislative Fiscal Bureau is required to estimate how much the proposal will cost. Here's one such report on a proposal from state Rep. Robin Vos, R-Caledonia. Vos wants to require voters to pass a referendum to join a Regional Transit Authority, which is a taxing body that would raise money to spend on transportation projects like busing and commuter rail.

Here's the complete fiscal estimate (emphasis added):

Bill Summary: The bill allows most cities, towns, villages, and counties to create regional transit authorities (RTAs), which are public bodies corporate and politic that are separate governmental entities.

Fiscal Effect: The bill does not directly impact the Department, and therefore the Department assumes that it will have no state fiscal effect. The Department assumes that political subdivisions eligible and electing to create RTAs will incur one-time costs related to activities necessary to form the RTA, e.g., drafting and adopting authorizing resolutions. The Department assumes that the one-time costs associated with creating RTAs will differ among local units of government, but has no basis for reliably estimating the amount of those one-time costs. Therefore the Department has listed the local government fiscal effect as "indeterminate". However, because the bill provides that RTAs, once legally formed, may set fees and charges for functions, facilities, and services provided by the RTA, the Department assumes that RTAs will set fees at levels sufficient to cover their costs and will have no net annualized fiscal effect.

In other words, there are no anticipated costs for RTAs because the RTAs will set fees to cover the costs. So what are the fees? "Indeterminate."

And what's the point of this fiscal estimate? Also ... indeterminate

KRM backers forge on

Backers of the proposed commuter rail line from Kenosha to Milwaukee with stops in Racine and Caledonia are forging on after a major setback in the state budget process.

Legislators dropped the funding source for KRM, setting back the line two years - if not longer. Transit NOW, the lobby group fighting for commuter rail, issued a statement Thursday saying they were not deterred.

"The feedback from business and elected leaders in the past few days has been overwhelming. There is more commitment than ever to keep KRM moving," Rosemary Potter, executive director of Transit NOW. "There is broad consensus that KRM is simply too valuable to lose."

Transit NOW said the southeast Wisconsin Regional Transit Authority will meet in November to develop an alternative dedicated local funding source for KRM and local transit. The organization also noted the support from several business and legislative leaders.

"While we are not happy with the outcome of a very frustrating budget
process, it is still one more step in the legislative process to keep the
train moving. Major projects are never easy, simple or advance without
opposition.

- Julia Taylor, President, Greater Milwaukee Committee

"A modern, fully-integrated transportation system that serves our City and our region is critical to Milwaukee's economic health and vitality ... we should continue to search for a comprehensive funding solution for this effort."

-Milwaukee Mayor Tom Barrett

"While I am extremely disappointed by the partisan opposition to KRM, I am pleased to see that efforts to find a solution continue. KRM would create thousands of jobs and revitalize entire communities, which is why it has such strong support from the business community and local leaders. This could be the single biggest economic development tool for all of SE Wisconsin. We can't afford to give up now."

-State Representative James Kreuser

"We are very disappointed that KRM was not included in the state budget. Our economic success as a business and as a region lies in better connecting communities and individuals in the Milwaukee-Chicago corridor. We consider KRM a great value, and a key to growth in the region and we're committed to keep working to get it done."

-Chip Brewer, SC Johnson, Director of Worldwide Government Relations

"We are not deterred by this setback. KRM is too important to the economy of this region to let it slip away. KRM is a huge priority for businesses in SE Wisconsin and we fully intend to see it become a reality."

-Jerold Franke, President, WISPARK, LLC

Senate passes KRM funding; Assembly doesn't act

The Senate passed a $13 rental car fee increase to pay for the KRM commuter rail extension from Kenosha to Milwaukee.

The fee increase was included in a $5.5 billion two-year transportation budget, which included a new tax on oil companies. Because of a political fight over the oil tax, the transportation bill was broken out of the state budget.

The Assembly now needs to pass the transportation budget with the KRM funding intact, and the governor needs to sign the bill, for it to become law.

Along with the rental car fee increase, the bill allocated $1 million for the KRM extension, allowed the Regional Transit Authority in charge of KRM to borrow $50 million to build the system, and required the RTA to study extending KRM to the north side of Milwaukee.

The transportation budget passed the Senate 18-14. Sen. John Lehman, D-Racine, voted in favor.

The Assembly did not vote on the transportation budget Monday night. It's unclear when they will vote on the bill.

Commuter rail funding in state budget limbo

As the state budget negotiations drag on, I've spent the past two days trying to gauge where the funding proposal for KRM, the commuter rail expansion to Racine and Milwaukee counties, stands.

To recap, the Senate passed included in its version of the new state budget a hike in southeastern Wisconsin's rental car fee to pay for annual operation of the system, which could start as soon as 2011. The Assembly didn't include the fee increase in its budget. The result: a conference committee will decide the proposal's fate.

It's unclear how big of an issue the KRM funding is for either side. It's certainly not on the level of the cigarette tax, education funding or the tax on big oil. But it's not a small item, either. Local legislators on both sides of the issue confirmed that commuter rail is getting attention - it's just hard to say what, exactly, is being said.

Here's what we heard from local legislators on the issue:

State Rep. Cory Mason, D-Racine

Mason said he gets the senseKRM funding is a tier 2 issue that will come up once the big issues are resolved. He couldn't say what direction the committee was
leaning.

He did say he's pushing State Rep. Jim Kreuser, head of the Assembly Democrats, to fight for commuter rail. Kreuser, who represents Kenosha, is sympathetic to the issue.

Mason added that a recent letter from Racine CEOs backing KRM was a boost for the proposal. The business leaders continue to press the issue, and that's helping commuter rail's chances in the budget process.

State Rep. Robin Vos, D-Caledonia

Vos clearly says he's not opposed to KRM. He is, however, opposed to using the rental car fee increase to fund the annual operation. He's pushing for alternatives, and his opposition to the current plan could influence the conference committee. After all, his district would get a commuter rail station - if he's opposed,
why should legislators from around the state support the plan?

Vos said Wednesday he favors a two-tiered referendum on funding for commuter rail. First, local governments vote on whether they want to hold a referendum on joining a regional transit authority that would fundKRM with a sales tax. Then, residents in each community would vote on commuter rail. Vos said a similar system worked in Michigan, and he feels it's the fairest way to implement commuter rail.

He also suspects the proposal would go down, at least in his district. Vos said he's heard overwhelmingly negative comments from constituents, which makes it easy for him to stand against Racine business leaders.

He added that he believes mostKRM supporters are so desperate to get commuter rail they're backing a flawed funding plan that will lead to deficits in the future.

State Sen. John Lehman, D-Racine

A strong supporter of commuter rail, Lehman pushed theKRM funding through the Senate's budget. Now, he's working with the conference committee to get it included in the final draft.

In an e-mail Wednesday, Lehman said KRM is still on the table and the rental car fee remains the most viable funding option for commuter rail. He also noted that in the last week that leaders from Milwaukee, Racine andKenosha counties failed to reach consensus on a broader proposal to fund regional transit. That could clear the way for KRM funding - a possibility Milwaukee County Executive Scott Walker discussed on
Wednesday.

Commuter rail gets a boost from failure

I spent much of Wednesday trying to track down the status of funding for the proposed commuter rail expansion from Kenosha to Milwaukee. I'll be writing about this more tomorrow, but tonight here's some interesting information from Milwaukee County Executive Scott Walker.

I'd heard earlier in the day that Walker talked about KRM funding during a "Mayor's Roundtable" hosted by Milwaukee Mayor Tom Barrett (read here for an interesting take on the event). Walker reportedly said that KRM funding had a better chance of passing now that leaders from Racine, Milwaukee and Waukesha counties gave up on a sales tax increase to create a regional transportation system. Negotiations to create the system broke down last week, and that could be to KRM's benefit, according to Walker. Or so I was told.

Later in the day, Walker himself confirmed his comments in an e-mail. Here's what he wrote:

Per your question, I said this morning that one of the unusual side effects of there not being an agreement on a funding source for mass transit in the region at this time is that it might make passage of the funding for KRM more likely. Some on the current RTA were concerned that lawmakers would not approve the KRM plan while local leaders were discussing the larger issue of transit in the region. Since the debate over sales tax has brought that to a halt, it removes a potential barrier to the KRM plan.

KRM still faces some big hurdles in getting approved by the conference committee negotiating the state budget. One big hurdle is State Rep. Robin Vos, R-Caledonia, who isn't opposed to KRM, but isn't sold on the proposed funding mechanism. More on that tomorrow, along with takes from State Sen. John Lehman, D-Racine, and State Rep. Cory Mason, D-Racine, who are both strong proponents of the commuter rail expansion.