A Minnesota commuter rail line is costing taxpayers approximately $22 per passenger, per trip.
“When you’re subsidizing about 80 percent of every trip on the line, it’s a really big fiscal disaster,” Annette Meeks, Freedom Foundation of Minnesota CEO, told The Daily Signal.
The Minnesota Northstar rail opened for service in the fall of 2009, providing commute by train down the 40-mile stretch of railway that runs from downtown Minneapolis to Big Lake. The route cost taxpayers $320 million to build, half of which was funded with federal transportation dollars.
“Federal taxpayers have already paid $150 million for the construction costs of the Northstar Line in the form of New Starts’ grants,” Michael Sargent, a research associate in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation, told The Daily Signal.
“Too often these grants incentivize cities to build expensive, inefficient rail systems that rarely live up to ridership expectations and leave taxpayers on the hook to cover exorbitant costs while existing infrastructure and more sensible alternatives are ignored,” Sargent said. “That certainly appears to be the case with the Northstar, which only covers a meager 15 percent of its operating costs through fares. Taxpayers have to pick up the other 85 percent of the tab, which doesn’t even include the cost of the tracks or the cars.”
The federal government has paid out $161.9 million for the rail line.
In 2014, passenger fares brought in approximately $2.3 million dollars, while rail line expenses totaled around $15.5 million, according to the Freedom Foundation of Minnesota. During the first full year in operation, 2010, the rail brought in about $2.5 million, but required about $16 million to run.
However, activists in Minnesota are not satisfied with the current rail route and want it expanded. The GRIP/ISAIAH faith-based social justice group is lobbying for an extension of the rail line from Big Lake to St. Cloud.
“We feel we deserve the option to not own a car,” Richard Gordon, a St. Cloud State University student, said, the St. Cloud Times reported. “I’ve never owned a car and I don’t plan to, so I need this train.”
The rail line was originally planned to go about 65 miles from the Twin Cities to St. Cloud as a commuter rail line, Meeks says. When applying for federal funding, the rail line did not meet the criteria to qualify for 50 percent of the costs to be funded through the New Starts program under the Bush administration, “because the ridership projections did not meet the Bush administration’s criteria,” she said. Thus, the line was shortened and ended at Big Lake in order to qualify for the federal funding.
Northstar ridership was 722,637 riders last year, up 1,423 riders—only around a 0.2 percent increase—from 2014, the Minneapolis Star Tribune reported.
Meeks told The Daily Signal that the daily ridership goals were predicted to be 3,400 riders. Daily ridership last year was around 2,500 riders.
“There were some of us who were strongly opposed to this from the get-go because there is not the population density along this line to ever meet their daily ridership goals,” Meeks said. “That means that it’s going to be heavily subsidized by people who will never set foot on this line.”
Taxpayers subsidized $21.43 per passenger, per trip in 2014. In 2010, taxpayers spent $22 per person, according to the Freedom Foundation of Minnesota.
“It never should have been built,” Meeks said.
She added: “After five years, if something doesn’t catch on, to me it’s just a bad experiment and you should stop experimenting with taxpayer dollars.”
A Northstar Corridor Development Authority study concluded that it would cost around $150 million to extend the rail line to St. Cloud, which is almost 30 miles away from Big Lake. The Minneapolis Star Tribune reported that preliminary capital costs for building the line would be around $40 to $50 million.
Currently, to connect by public transportation to the Twin Cities, St. Cloud residents can take a bus to Big Lake before connecting with the Northstar train.
“Expanding this costly system with more federal dollars is a bad deal for taxpayers and riders alike, especially when there are more cost-effective options—such as bus service—available to residents of the region,” Heritage’s Sargent said.