Michigan dishes out $85M in tax money to fund QLine streetcars as costs increase

Fares and private boosters were supposed to fund the streetcars — not taxpayers

Dec 30, 2022 at 1:20 pm
click to enlarge One of Detroit's QLine streetcars. - Steve Neavling
Steve Neavling
One of Detroit's QLine streetcars.

The underperforming QLine streetcar in downtown Detroit is going to continue being a tax boondoggle for at least the next 17 years.

Gov. Gretchen Whitmer signed legislation on Thursday that will give $85 million of taxpayer money to subsidize the QLine through 2039.

That amounts to $5 million a year — or more than half of the streetcar’s annual operating budget of $9.9 million, which has nearly doubled over the past five years.

The streetcar, which has been more of an economic development engine for downtown than a transportation solution in a city where a quarter of residents don’t have a car, wasn’t supposed to heavily rely on tax dollars to operate. When the QLine opened in 2017, boosters insisted that a vast majority of the operations would be paid for by fares and private funding.

That didn’t work out as planned. Ridership has fallen far short of expectations, and fares were scrapped in hopes of attracting more riders.

With the tax subsidy, which will come from hotel and liquor taxes, rides will continue to be free.

The average number of daily rides was nearly 2,500 in September, October, and November, far fewer than the orginally projected 5,000 to 8,000 daily riders.

QLine spokesman Dan Lijana says the COVID-19 pandemic prompted changes to the fare system, noting that Tucson’s streetcar’s and Washington D.C.’s buses also switched to offering free rides.

“The pandemic changed operating models for many transit systems across the country, including the QLINE,” Lijana tells Metro Times. “The QLINE transitioned to operating fare-free for passengers when it returned to passenger operations after the COVID-19 service pause.”

Asked why the operating costs have nearly doubled, Lijana says the QLine has improved its services and changed management to provide a more efficient system.

“QLINE transitioned to a locally managed and operated system as it emerged from the service pause,” Lijana says. “The system is now fully staffed with operators, has added streetcar specific expertise to its team, and made capital investments in improving service, such as installing portions of dedicated transit lane on Woodward, transit signal prioritization at 26 intersections, technology to ensure accuracy of streetcar arrival information and reduction of blockages along the route. Those investments have helped QLINE meet its goal of streetcars arriving every 15 minutes or less more than two-thirds of the time over the last six months compared to just over half of the time, pre-pandemic.”

To get the QLine up and running, the U.S. Department of Transportation dished out $37.2 million, and another $41 million in public money came from the state of Michigan, Wayne County, Wayne State University, and the Detroit Downtown Development Authority. In total, 42% of the QLine’s startup costs, including building the rails and buying the streetcars, came from public and quasi-public money.

Meanwhile, Detroit’s bus system, which many residents rely on for everyday transportation, is plagued with delays and remains a constant source of complaints. Many public transportation advocates question why so much money has been spent on a 3.3-mile streetcar track that is nowhere close to where most Detroiters live.

Metro Times couldn’t reach the governor’s office for comment.

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