Might Rail?

Hopes are high for the Woodward Corridor - But obstacles remain

Feb 23, 2011 at 12:00 am

Despite all the hype and hope for light rail along Detroit's Woodward corridor, there are major questions of funding. And there is also the daunting legacy of decades of mass transit hopes that haven't left the station.

The current plans are moving forward for a light rail train, the first leg to be constructed largely with private funds and running from downtown to New Center with connections to the downtown People Mover, the Amtrak station and city and suburban bus lines.

No formal plan for funding the new light rail system's operation has been put forward — yet — and more questions concern the track's second leg, which would continue to Eight Mile Road.

While transit advocates are hosting public informational meetings this month, the Bing administration is quietly, behind the scenes, shaping plans for funding both construction of the second leg and then operating the entire line with a combination of a local bond issue and hoped-for but as-yet-unsecured state and federal grants.

That's part of a plan that the administration is circulating to some Detroit City Council members and their staffs. The bond issue proposal could go before the council as early as this week.

Neither Bing nor his administration has made formal announcements about funding plans, at least in advance of the mayor's State of the City speech, to take place after this story went to press. But according to City Council members and staff who have had meetings with city administrators, proposals call for the council to issue bonds to fund construction and operation or to leverage future federal monies such as the New Starts grants or a second federal program that deals with transit construction and operation in urban areas.

One proposal for construction of the New Center to Eight Mile Road portion has about $330 million coming from federal sources, some $17 million from the state and roughly $59 million from the proposed local bonds.

"They have not brought the resolution to council, but that's probably going to come this week or the week after," says Detroit City Councilman Ken Cockrel Jr.

Another proposal being circulated by Bing's staff considers how to fund the system, since rider fees are expected to be at least $10 million a year short of covering the operation. One version of Bing's plan is to fund the rail line's operation with $2 million from the city's general fund, $5 million from the state, $3-5 million from the Southeast Michigan Council of Governments and $2-3 million from the state's gas tax.

SEMCOG's transit planner, Carmine Palombo, says the organization has not been approached about providing such funds. "I'm encouraged to learn they're putting together a plan. That's what they need to do," he says. "No one has said anything to us yet."

Comments and details on the funding plan from a number of key players have not been forthcoming. Metro Times was unsuccessful in reaching Norman White, Bing's chief financial officer who is the administration's point person on the light rail project. Matt Cullen, the spokesperson for the M1 Rail Corp., the private investors who are largely spearheading and funding the first phase of construction, did not return telephone calls or e-mails. And a Michigan Department of Transportation spokeswoman said she didn't know of any state funds committed beyond a $25 million federal grant that passed from the state to the city last year.

Council President Pro Tem Gary Brown says he has been told future federal grants would cover debt service on bonds the Bing administration wants the council to authorize soon.

"We have a real problem with the front-end loading of these costs without having an assurance that the grant money will stay consistent," Brown says. "We haven't seen anything in writing that the federal money will continue.

Getting on track

For years, activists and some government officials have been agitating for regional transit in southeast Michigan.

The People Mover, a downtown loop that runs but a few miles, remains the most advanced transit technology in the region: an elevated, automated train that is not interrupted by street traffic. But an effort a few years ago to extend it from its northern edge in Grand Circus Park to the Detroit Medical Center, Wayne State University and Henry Ford Health System's campus stalled when leaders didn't think it was "politically acceptable," says Marsden Burger, a transit consultant who originally came to Detroit to work on the People Mover when Coleman Young was mayor. "If the People Mover were expanded, it could provide higher service levels and could operate out of its existing operational fund," Burger says. "That's huge. It knocks away one of the prime problems of funding operations."

A second proposal for transit improvements for the region includes commuter rail between Detroit and Ann Arbor with stops in Dearborn and Ypsilanti as well as a newly constructed station near Detroit Metropolitan Airport. The project has gotten a boost with federal funding of track improvements this year, Palombo says.

It's possible some "event service" — dedicated passenger trains for, say, University of Michigan football games or the Detroit Thanksgiving Day parade — could operate this year. But the plan, in the works for years, has not garnered full federal funding, the key to these massive projects.

And then there's the separate operation of the city and suburban bus systems, an administrative structure that dates back decades and results in some duplication of routes and service.

The proposed light rail up and down Woodward Avenue is the latest hope for the real start of a system that would connect the discrete existing parts: the People Mover, Amtrak and the city and suburban bus systems.

"If we're going to do it, it's got to be part of the broader regional transit vision," Cockrel says.

As outlined by Mayor Dave Bing's staff in meetings with City Council's staff, the 9.3 miles of the Woodward Light Rail project from Jefferson Avenue to 8 Mile Road could cost $450 million to $500 million to construct.

To date, private investors have pledged about $125 million, earmarked for the first phase, although the exact amounts and terms of all the funds haven't been determined or secured.

Through a stimulus grant announced last year, $25 million of federal funding also is committed for the first stretch, bringing the total project funding to about $150 million, which supporters say covers the construction costs. If all goes according to the latest schedules, the line could be open for riders in 2013.

Construction is scheduled to begin this fall, although Megan Owens, executive director of Transportation Riders United (TRU), a nongovernmental advocacy group, says the groundbreaking could be "ceremonial" only.

"I don't know if they'll be completely ready this fall, and I don't know how much real construction they can do over the winter," she says. "Folks at DDOT [Detroit Department of Transportation] keep saying construction 'could' start this fall and that the 'goal' is to start this fall."

The Federal Transit Administration, part of the U.S. Department of Transportation, has expressed interest in the rail initiative as it continues beyond New Center as part of a program called New Starts, which could cover as much as 60 percent of the project's capital costs. No funds, so far, are committed, although the recently released preliminary environmental impact statement is one of the early steps of the process for the federal New Starts money to be awarded.

Still, the future availability and amounts of New Starts grants are hardly assured with the new Congress' budget-cutting agenda, not to mention the question of who controls the White House after 2012. President Obama has been friendly to urban and mass transit projects, but a new president may not share the priority.

Regardless, Bing's staff anticipates having New Starts money for the second phase of the rail project and has presented plans for construction and operational funding based on such funds beyond the initial stretch of the rail line to New Center.

The best-case scenario for beginning the second phase's construction is at least a few years away, with riding it possible in 2016.

TRU, along with the Michigan Environmental Council and Transportation for America, are in the midst of hosting a series of community forums where people can learn more about the project and ask questions that Owens and others answer when they can. They're focusing on the first phase: the Jefferson to New Center segment, as the configuration of the southern terminus isn't finalized — and it hasn't been decided if the track will run at curbside or in the middle of the street.

Meanwhile, part of the New Starts application process, which city officials hope will eventually fund the second phase, is the recently completed preliminary environmental impact statement that was formally presented Feb. 12, at two hearings attended by about 400 people at Detroit Public Library.

Attendees viewed poster-sized renderings of proposed routes — including where track would run in the street (curbside or in the middle) and the configuration of the tracks downtown, which has not been finalized.

Federal and city officials also presented the results of the preliminary environmental impact study released earlier this year. The study, required by the federal New Starts process, found no major negative environmental impacts from the project.

Public comments were limited to three minutes. "A response to all verbal and written comments received by the March 14 deadline will be published in the final environmental impact statement scheduled for completion in early May 2011," says Tricia Harr, a planner with the Federal Transit Authority, a division of the U.S. Department of Transportation.

Owens calls the process "an accelerated timeline" and says it's evidence the federal government is interested in the Detroit project.

"But there does need to be a financial plan," she says. "The first phase is pretty solid in terms of both the construction and operational funds. Extending it, there will need to be new revenue somewhere, and it's a little unclear right now where that will be from."

Mapping it out

In theory, the M1 Corp. has gotten commitments for about $125 million in private investment for Phase One of the light rail train system planned on Woodward Avenue.

Those monies can be considered part of a "local match" for future federal grants and as such are important for leveraging such funds.

But not all of the money is actually secured, despite the $125 million figure being included in project descriptions and public information.

"We have committed in dialogue. I don't have a contract yet. We have not signed a legal agreement," says William Schramm, senior vice president of strategic business development at Henry Ford Health System.

Schramm says Ford and several other private investors were offered "sponsorship" of certain stations, in part, in exchange for their financial commitment which could include naming rights or advertising space. M1 corporation executives have been working on those deals.

Finalized station locations are part of what will be released in May, but preliminary plans call for about a dozen between New Center and the riverfront with one roughly every mile north of New Center.

With reported interest from the Detroit Medical Center and Wayne State University in addition to the Henry Ford Health System, conversations have included discussing how those entities could tie their existing shuttle services into the light rail stops or otherwise access the rail tracks, for instance with their own transit spurs.

But Leo Hanifin, dean of engineering at University of Detroit Mercy, and a member of the M1 Corp. board, says it's important that spurs or other travel arrangements not interfere with the main goal of moving passengers along the Woodward corridor.

"If there are too many excursions from the straight route, then it starts to fail as a commuter system," says Hanifin, who is also director of the Michigan-Ohio University Transit Center, a five-school consortium that researches and advocates for mass transit.

While the private funders work out the exact terms of their contributions, planners are determining where to physically build the train tracks in the initial 3.4-mile stretch. The preliminary environmental impact survey presents both curbside tracks and a median-running system as options. Stoplights — and therefore traffic — would defer to the trains' operation for both, making them more efficient than buses.

But both curbside and center-running systems have advocates and detractors — and they've spoken at community meetings in recent weeks.

Jason Fligger, who lives with his wife and two children near Palmer Park, likes the center-running plan because of what many say is less risk of delays and therefore a standard timetable.

"Make it as reliable as possible," he says. "It still won't be a subway, but it will be better than a bus. It's not so much the speed I want. If it's predictable, you can deal with the timing of it."

But the original private initiative placed the trains in the second lane of traffic from the curb, which would bump out a lane to form stations. Parking would remain along most of the curbside on the route.

"I think it's far more effective in bringing people into the community, into the cityscape, rather than into a train system that zips up and down the center," Hanifin says.

The thinking goes that if riders are waiting for trains on the sidewalks or in curbside stations, they are more likely to frequent nearby coffee shops, bookstores or other business.

The economic development associated with mass transit systems in other cities — new and refurbished commercial sites, denser populations around stations and other economic activity — is touted as a major benefit of the Woodward project.

TRU and others are supporting the median-running option, saying it still offers such benefits. But Owens offers a subtle difference in priority for the system's benefits.

"Is this primarily an economic development project that happens to be transit, or is this a transit project that will also support economic development?" she says. "Where's the priority? ... We want effective transit that will also boost economic development. There's still a little bit of conflict or challenge over how to balance it."

Beyond 8 Mile Road?

And if the challenges to taking light rail to the edge of Detroit can be surmounted, what are the chances that it will ever go further?

Currently, a parking lot is penciled in near the State Fair grounds so that people could drive to the terminus, park and ride the train to work, sports venues, cultural institutions or other city activities. The SMART bus system would connect to some of the stops and link riders to other parts of Wayne, Macomb and Oakland counties.

"I just worry that we're not thinking big enough with this project," says Detroit City Councilman Cockrel. "You could raise the question: How is this not just the People Mover on steroids?"

Hanifin has a similar view: "People want to move around a region and not stop at city boundaries. They want to move throughout the entire region."

And as a board member of M1 Corp., he knows the obstacles well. Just a few years ago, the group pushed a vision for light-rail commuter trains from downtown to 11 Mile Road. That was before scaling back and concentrating on raising the private funds for the first three miles of light rail from downtown to New Center.

The biggest problem with extending light rail north of Eight Mile Road is the lack of a regional entity to spearhead and, eventually, administer the project. Such an entity would be needed before any federal funds could be granted for such a project.

Lacking that, the current M1-city project ends at the Detroit city line.

The closest thing to a regional transit body has been the Regional Transit Coordinating Council, created by the Legislature in 1988 and made up of the Wayne, Oakland and Macomb county executives and the Detroit mayor. But its effective operation ended last year, when John Hertel, who had been its CEO, resigned to join SMART.

Whether there is funding or political will to hire another administrator remains a question, but the council is by law limited in what it can do.

"The RTCC can accept money, but they can't go out and get money, and there's very little oversight of the process that the legislation gives them," says SEMCOG's Palombo. "In addition to that, the legislation says all four of them have to vote 'yes' in order for anything to happen. There hasn't been very much meaningful activity that's happened in public transit since the very inception of the RTCC."

A functioning regional transit authority would require new legislation, Palombo and others say.

For the coming months, Lansing is sure to be consumed by the budget process, one of the most contentious in memory, given the overhaul of state finances that Gov. Snyder proposed last week.

But after a budget is finally adopted, a regional authority for mass transit in southeast Michigan might make it to the forefront of agendas in Lansing, says Bill Ballenger, editor of the Inside Michigan Politics newsletter and respected political observer.

"There's only so much you can bite off when you're starting as a governor and a new Legislature," Ballenger says. "It's something that could be in a second phase of initiatives by the Snyder administration to get something done, provided everyone in southeast Michigan has got their acts together and kind of approaches Lansing with a request for help with all parties in metro Detroit on the same page."

Not that Ballenger thinks any legislative proposals for funding or a regional authority, for example, will be an easy sell.

"If there's some way that somebody can demonstrate that you could actually save money by so-called regionalism, whether it's for transportation, for schools, for municipal and township governments, great," Ballenger says. "If regionalism could be something that would facilitate cost-cutting and saving money in a way that people could be pretty sure that there would be some immediate result or at least results at some point, then, yes, there's some hope for an approach toward regionalism, but otherwise I'm not sure regionalism is something that legislators are really thinking about right now."

State Rep. Jim Townsend, a Royal Oak Democrat, was elected to his first public office last year and began his term in the Michigan House in January. A founder of the Suburbs Alliance and former executive director of the Tourism Economic Development Council, he says fostering mass transit for the region — really north of Eight Mile Road, since he considers the Detroit side of the project under way — is a top priority.

"It's harder for us to organize to build big things like a transit system because the economic power and the political power are dispersed in southeast Michigan," he says. "That's also the reason we have to collaborate with each other much more than we ever have, because none of the nodes on the economic map have the wherewithal to get big things done."

Neither the individual counties nor Detroit, Townsend points out, can build transit systems for the region without each other's cooperation.

"The suburbs, even if they banded together, it's very unlikely they could muster the will to do it. And we all lose because we don't have it," he says. "You need an entity coordinating the service because a rail system is only as good as the rest of the system: buses, park and ride, and other things that are connected to it."

The Legislature should establish such an authority, he says, perhaps starting with something called a "corridor authority" that could grow into a regional organization. Such mini-corridor authorities — think the Woodward Avenue Corridor Authority, for example — could, the thinking goes, at least be set up with legislation that would give them room to grow and evolve into a regional organization if the demand for mass transit in southeast Michigan grows.

Townsend expects legislation to be introduced this year to set a preliminary framework for some kind of mass transit authority but says discussions haven't gotten so far that he could offer any further predictions.

"There's discussion about a number of different ideas," he says.

The recent clash over Bing's proposed regional water board to administer the city's troubled water and sewerage system is an example of how high passions run in the region over sharing power and control.

State Rep. Kurt Heise, (R-Plymouth) introduced legislation that would essentially strip Detroit of control of the board. Bing worked out a power-sharing deal earlier this month with suburban county executives that included allowing Macomb, Oakland and Wayne county leaders to each choose a representative on the seven-member Detroit Board of Water Commissioners. Some city council members are strenuously objecting.

But some transit authority advocates are pointing to what they call the relative success of the oversight board that was created for Cobo Center as an example of how creative thinking, shared governance and a regional approach can work.

"It's been a fast pace, but there are a lot of success stories to point to. I think the future's only bright," says Larry Alexander, chair of the new authority, officially named the Detroit Regional Convention Facility Authority.

The group took control in 2009, and now oversees the convention center's operation. In the deal, which was accompanied by much public protest and controversy, Detroit lost full governance of the riverside facility but also was relieved of $20 million annual operating costs.

As prescribed by the enabling legislation, the five Cobo board members are named by the mayor of Detroit, Macomb, Oakland and Wayne counties and the governor. The board has statutory limits restricting how much money it can borrow or spend.

"In my mind that's a good thing because we've got to be very careful with the taxpayer dollars, and it forces you to work in the parameters," Alexander says.

The authority also must balance its budget, and the five members must agree unanimously to pass measures.

"The five of us are there to represent the region and the state in order to accomplish the goal," Alexander says. "Once we get past any politics, it's the best way to get the job done."

But a mass transit system is inherently different, more complicated and less defined than the convention center. Its eventual multitude of locations and destinations and funding streams of private, local, regional, state and federal dollars, for example, make using the Cobo model difficult — but not necessarily impossible.

What application does Alexander see from the Cobo authority's short life to anything that might be set up — eventually — for mass transit?

"I think the key is to get the right people around the table and leave the egos out of the room and focus on what is the goal and real mission and the best way to get that done in the most expeditious manner," he says.

Three more informational meetings where community members can discuss the light rail project with transit advocates are scheduled, all starting at 6 p.m.: Wednesday, Feb. 23, at the Detroit Public Library, 5201 Woodward Ave.; Thursday, Feb. 24, at Little Rock Missionary Baptist Church, 9000 Woodward Ave.; and Tuesday, March 1, at St. Matthew & St. Joseph Episcopal Church, 8850 Woodward Ave.


Private partners
A rundown of the forces behind laying rail

The M1 Rail Corp., formed in 2007, has a notable board of directors according to corporate records filed with the Michigan's Department of Energy, Labor and Economic Growth.


President Matt Cullen
President and COO of Rock Ventures LLC, former general manager of economic development and enterprise service for General Motors Corp.

Vice President Ann Lang
Past president and chief executive officer of the Downtown Detroit Partnership

Vice President of Operations Paul Childs
COO of the Downtown Detroit Partnership, principal and owner at TPC LLC, former operations manager at DDP, former regional director at Jefferson Wells International.

Chairman Roger Penske
Owner of Penske Corporation, former professional race car driver, former owner of Michigan Speedway

Vice Chairman Dan Gilbert
Chairman and founder of Quicken Loans and Rock Financial, majority owner of Cleveland Cavaliers, founder Rockbridge Growth Equity LLC

Treasurer Thomas P. Dekar
Vice chairman of Deloitte LLP and the regional managing principal of the North Central Region, board member of Detroit Economic Growth Corp., chairman of the Michigan Chamber of Commerce

Secretary John R. Axe
Grosse Pointe Farms attorney

Additional Directors:

John C. Hertel
General manager at Suburban Mobility Authority for Regional Transportation (SMART) bus system, former CEO of the Regional Transportation Coordinating Council's Detroit regional mass transit effort, former Michigan State Fair general manager, former county board chairman, state senator

Leo Hanifin
Dean of College of Engineering and Science at the University of Detroit Mercy, Director of Michigan Ohio University Transportation Center.

S. Martin Taylor
Retired executive vice president of DTE Energy Co., former interim president of Detroit Renaissance and currently a University of Michigan regent.

Rip Rapson
President and CEO of Kresge Foundation, former President of the McKnight Foundation.

George W. Jackson, Jr.
President and CEO of Detroit Economic Growth Corp.

Atanas Ilitch
President Olympia Development LLC, director at Detroit Partnership.

Norman L. White
Chief financial officer, City of Detroit; board member of Michigan Public Transit Association.

Compiled by Alia Raheem, Metro Times editorial intern.