Sunday, September 20, 2009
Is this really a success?
Jennifer Steinhauer thinks that light rail in Phoenix is a success. Her evidence is that while projected daily ridership was 26,000, it has clocked in at 33,000. The reason that ridership is better than forecast is because of weekend riders--people are using the line for pub crawls, among other things.
But ridership of 33,000 per day translates to about 12 million per year. The system cost $1.4 billion to build, not including lost revenue to businesses located along the line (which was probably largely displaced to other business). Let's assume that the cost of capital to Phoenix is 6 percent and that the system depreciates at 2 percent per year. Therefore, the capital costs of the system are about $110 million per year.
Assuming fares cover operating costs (and they almost certainly don't), this means that each ride is subsidized to the tune of more than $9, and according to the article much of the subsidy is going to entertainment.
I think it is great that some people in Phoenix are leaving their cars at home when they go out drinking. But I would guess that a free shuttle service going from bar to bar would have cost the taxpayers of Phoenix a lot less money.