Union Is Strength: Lessons in Low Speed and High Speed Rail
by Tony Chavira
Since October 2009, Los Angeles bus ridership has dropped from 31.3 million a month to 29.9 million a month, and some people blamed strategic (and possibly sleazy) service cuts. The Federal Transit Administration investigated the MTA this past March after a bus rider advocacy group complained that bus service cuts just so happened to focus on areas full of working poor people. When the FTA found nothing especially discriminatory about the cuts, the advocacy group dropped it, and yet didn’t seem to bother trying to break down the number drop: the MTA cut its bus service by 8% last year and another 4% this year, but ridership only fell 4.5%. Now, more riders now depend on fewer buses. And the MTA knows it.
But buses aren’t our preference. Ridership on Los Angeles’s new transit of preference, light rail, rose from 7.6 million in October 2009 to 8.1 million in October 2011. And between our expanding rail capacity, a record-breaking $4.2 million budget to invest in light rail projects, and our dramatic preference for light rails over buses, ridership’s only going up. To plop a cherry on this light rail sundae, the MTA voted to buy Union Station earlier this year from Catellus Operating Limited Partnership for a cool $75 million and now, for the first time ever, the city owns the rails and the station. The Urban Land Institute took notice of Los Angeles’s awesome public purchase, and recently conducted a study to determine how the whole Chinatown/Little Tokyo/Olvera Street/Arts District/Civic Center/Los Angeles River will change in 20 to 50 years. Their goal: to turn Union Station into the center of an economic and cultural megahub. How do we do it? Add more residential units and lofts, then add more commercial spaces, shrink the streets, coordinate the buses, and fill in blank walking spaces between these areas. Basically, stuff we already know and planning’s already figuring out, one street at a time.
But while we love that light rail, Californians on the whole are falling out of love with high speed rail, which was supposed to connect to Union Station and bring in the big bucks. Turns out, a mix of lawsuits and planning under-estimated the high speed rail’s cost, and now it’ll be about twice as much. After finding that out, a nonpartisan, independent poll (that found that 64% of respondents wanted to vote “yes” and spend $9.95 billion in bond cash on high speed rail in 2008) discovered that 59% want a second vote to shut the project down and get our money back.
And yet, Amtrak’s reached an all-time ridership high. Californians, it seems, don’t make their decisions based on reason.
For all the flak we give the city of Los Angeles, it can be very reasonable sometimes. Catellus Operating Limited Partnership bought the Los Angeles Union Passenger Terminal in 1990 from some other private owners with a plan to rename and revamp it into something majestic, useful and profitable. And through a combination of good investment foresight, expansion of services and the heathen matrimony of smart coordination with MTA and the almighty free market, Union Station’s facelift succeeded enough that our city discovered it would finally be a smart investment. A big step for us, considering that the last time our city put money into Union Station we voted to demolish half of Chinatown to build it and summarily sold it off to its first private owners.
A brief 72 years later, the high priests of high speed rail somehow can’t seem to make money fall from the sky. They’ll blame the citizens of California for sic’ing the lawsuit brigade on em for trying to slip a train into our backyards. They’ll blame Fox News for turning 73% of Californian (and a whole nation of) Republicans against them. They’ll blame their cost estimators for severely overselling the concepts while severely underselling the project’s financial burden. They’ll probably even blame the voters in California for not anteing up the cash they’ll need to keep their project alive.
Ultimately, high-speed rail’s going to be taken out back and shot because it had a bad business plan. We’ve seen high speed rail advocates dilemma before: 1930s Los Angeles raged over every detail of Union Station’s cost and location. And let me tell you, we and private investment paid for that confounded building while pulling ourselves out of the Great Depression by our bootstraps, dammit. Pay no attention to the large portion of racist assholes who just found a convenient excuse to steamroll half of Chinatown flat.
Today the stars align forcibly: our planning and zoning departments work like hell to rezone everything from Lincoln Park all the way down to the East Los Angeles Interchange to promote future streets for walking, future lofts for living and future commercial spaces for businessing. The Urban Land Institute and the Army Corp of Engineers chipped in studies and evaluations while the MTA coyly shifted the focus of its budget to better integrating our current transit system (even if that means cutting some bus lines, unfortunately). UCLA and USC pump out research at maddening rates that evaluate everything area, every streets, every city and every social service you can imagine. And all the while, somehow, people slowly but surely increase their transit ridership in a city that was famously built for cars.
When they see this kind of coordination taking place, the High Speed Rail Commission must be asking itself the wrong question: Where’s this kind of coordination and support for high speed rail? But the question they should be asking is: Is the demand for high speed rail high enough to warrant investment? Los Angeles voters built Union Station for heavy rail lines and to bulldoze Chinatown to the ground, but residents eventually bought enough cars, took enough plane rides, and got over their racism enough that the station just didn’t mean anything to us anymore. In other words, it was originally just another stupid investment (and especially stupid considering that the original ballot measure gave us the choice between Union Station and a huge system of above-ground trains).
In the end, High Speed Rail’s collapse should be blamed on two groups: the Commissions’ market research team and their financial analysts. First off, yes… we all want high speed railways. Even Republicans would use them if we had them. But was there enough market demand, from each market involved, to stir up enough investment to bring high speed rail to life? To justify its total investment? To enact the legislation it’ll require? To implement it seamlessly? Yes, maybe … if they evaluated its cost correctly the first time. Instead, their financial guys must have tossed their cost and benefit analyses into a fire or something. Of course the price was going to be twice as much as originally estimated … did someone bother telling these people that transit ain’t cheap? Them hydrogen-power buses we love to tout cost $400,000 a pop; diamond freeway interchanges cost about $9,000,000; hell, an intersection with signals costs more than $175,000! And there isn’t a Bus-, Rail- or Streets-Mart where our city can buy stuff in bulk for a discount: everything we buy is custom-made.
To top it off, we dish out the benefits of building mega-projects to an elite few while divvying out the costs to everyone. All those guys who helped the Commission raise their original pot-o-gold were salivating over this project for one reason: they’d cash in big-time when the final budget is three-time the original estimate. And since millions of taxpayers like you and me will fund it, it’s not worth our precious time to shut it down once the gears are in motion. The 1% sell us on it, the 99% pay them for it. Big-time contractors, the guys who’ll eventually get the contracts to build the high speed rail, know this all too well: they’ll underestimate the cost of huge projects, then shrug their shoulders when it’s only half built. “I guess you’ll need to pass another bond to pay us for the other half!” they’ll say, chortling to themselves as they light their Cuban Monte Cristos with a stack of flaming $100 bills.
And we’ll usually do it because we’re idealistic chumps and think it would be nice to have a 1.5 hour train ride up the coast. But not because we need it. Unfortunately, the economic downturn took away the luxury of deciding whether or not to move forward with conceptual public ultra-projects (the new answer is “no”), but it also taught Southern Californians a valuable lesson: that we should not take our light rail too lightly. Now that a larger market demands the light rail lines and more MTA service, buying Union Station has finally become a smart use of city resources. Catellus Operating Limited Partnership worked to make it profitable and sold it to us for future moneymaking. Win and win.
As for high speed rail, the Commission needs to get a little more private and lot less public. Then, at least, lost money won’t be public money anymore and someone will be finally forced to do an analysis that isn’t based on just wanting high speed rail really really badly. Besides, money is always better spent when it’s yours and not other peoples’. The taxpayers have done their job … now it’s time to put the investment in the hands of the investors.