The Livable Communities Coalition

Working to improve Atlanta's quality of life through smart growth

Anti-transit myth #7: Rail transit does not spur economic development

Myth 7: Rail transit does not spur economic development.

It is rail transit, not bus service, that spurs economic development. The reason is simple. Bus service can change overnight. A bus route can be discontinued or
rerouted easily. No developer can invest on the basis of something so ephemeral. A rail line, in contrast, is a fixed, high-value asset. It cannot get up and move, and the amount of capital invested in it makes service discontinuance highly unlikely.

And the asset of rail transit service is very real. In one city after another, rail transit – heavy rail, light rail or commuter rail – has brought increased investment, higher property values, higher rents and more customers.

In our first study, “Conservatives and Mass Transit: Is It Time for a New Look?,” we offered the Washington D.C. Metrorail system as an example of rail transit spurring economic development.

Washington’s Metrorail system is a heavy rail system; what of the effect of light rail on development? St. Louis and Dallas offer examples, and both point to the same conclusion: Light rail can have a strong and positive impact on development.

If light rail was going to fail anywhere, Dallas would have seemed the place. After all, Texans were wedded to their cars, and only the poorest used public transit.

Since DART opened in 1996 – on time and within budget – it has carried more riders than projected: 42,000 per weekday by the latest count. And it has had an immediate and positive effect on development. DART Board Chairman Jesse D. Oliver recently wrote:

Developers are building on the success of DART’s $860-million light rail system with more than $800 million in ongoing or planned projects near the stations – those already built, and those opening in the near future. That’s almost a dollar-for-dollar return on this public investment in just four years. I know of no other transit system in America that has generated so much economic activity so quickly.

Rail transit benefits individual homeowners, not just developers and businessmen, by raising the value of existing homes.

Edward A. Reusing, president of Downtown St. Louis, Inc., summed it up best. Having seen for just two years what light rail did for that city, he said in January 1995, “Extending MetroLink and the bus system which feeds it is the smartest economic development step St. Louis can take.” When the anti-transit troubadours sing that rail transit has no effect on economic development, it’s time to start heaving old shoes.

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