Paying for our streetcar

Now that the $25 million Federal funding application has been submitted for the downtown streetcar, it’s time to recap how we’ll pay for the $76 million remainder — via a Transportation Development District.

Bear with us, because this can get pretty wonky.

First, some background. The TDD is an economic development tool defined by Missouri statute. The law’s original intent was to afford voters an opportunity to organize and fund transportation improvements themselves using a sales tax or special assessment. In practice, most TDD’s in Missouri are drawn around strip malls and highway interchanges, thus allowing only property owners to form and set levies. Regardless of who forms a TDD, the main milestone is for a county judge to rule a TDD petition lawful. Once that requirement has been met, two votes occur within the district — formation and levies. Kansas City’s day in Jackson County court is April 17*.

Second, localized funding has been used heavily in streetcar projects, mostly due to lack of Federal support. Portland and Seattle have projects up and running that were also financed by special districts; others under construction have taken the same approach. The thinking is that the investment in a given corridor benefits those in that corridor the most; why not give them the opportunity to make the investment the City cannot afford to make?

We should note that the City ponied up $2.5 million for engineering, and will be one of the single largest contributors to the TDD (only DST’s reported annual contribution is higher).

Finally, we have the current situation with our streetcar. Once a judge rules that Kansas City’s TDD petition (#1216-CV02419) is lawful, voters will decide — like they decide many taxes and levies that property owners don’t get to vote on — with a simple majority of ballots cast.

TDDs exist in Kansas City and all over the state. Even the St. Louis Loop Trolley is using a TDD, as does the Plaza to pay for your “free” parking garages (if you consider a 1% sales tax premium “free”, even for those who walk or take transit there). There is nothing unconstitutional about voters determining the level of taxation within any municipal boundary. Community Improvement Districts — an economic development tool that can also levy assessments on property – are widely used throughout Kansas City to provide better services than the City can provide (security, litter removal, mitigating panhandlers). The TDD is no different, other than being limited to transportation uses. Downtown residents want a streetcar and this is the quickest, most effective way to build it. Period.

* The April 17 TDD hearing is for public comment. The actual legal decision will occur the next day and is not open for public comment, although the public can attend. We’ll bring you live updates from both on Twitter @kclightrail. To join the effort, like this page:

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1 Comment so far

  1. Kite Singleton April 2nd, 2012 7:57 pm

    Way to go, David. You’re always on time and usually on target…like this time!