It's true: Ending light-rail expansion in Phoenix would free up billions for other projects

MEDIA: Web

WHO: Building a Better Phoenix, a political action committee registered with the city of Phoenix

THE COMMENT: "Ending the expansion of the light rail will free up billions that can be spent on fixing city streets and sidewalks, expanding bus and dial-a-ride service, improved lighting and other much needed transportation projects."

FORUM: Committee website

WHAT WE'RE LOOKING AT:  Whether the initiative to end the light-rail extensions would free up billions of dollars for Phoenix to use for other transportation projects.

OUR RATING: FOUR STARS, TRUE

ANALYSIS: The anti-light rail group Building a Better Phoenix claims on its website that ending the light rail expansion would allow the city to use billions of dollars on other city projects.

Phoenix voters approved the light rail expansion projects in 2015 as part of the Transportation 2050 plan, a city initiative to increase investment and improve transit infrastructure. The plan includes expanding light rail across the Valley.

On April 12, a Maricopa County Superior Court judge ruled that Building a Better Phoenix had collected enough signatures to put light rail expansion back on the ballot in August.

If passed, the initiative would halt light-rail spending and cancel light-rail projects approved by voters. It also would forbid the city from funding any future light rail extensions or fixed rail, such as commuter rail or Amtrak. 

Critics of light-rail extensions argue construction harms businesses, increases crime, and worsens gentrification.

The oft-discussed South Central line expansion is expected to begin construction later this year. The route intends to connect the current line to Baseline Road via Central Avenue, requiring the reduction of the four-lane road to two lanes.

Critics: 'We'll be able to get that money back'

Susan Gudino, treasurer of Building a Better Phoenix, said if the light rail expansion were to end, money could be returned. 

"If it's canceled, we'll be able to get that money back," she said.

She referred to the city's funding from Prop. 104, which increased the 0.4% sales tax for transit to 0.7%, and is the base of funding for Phoenix's Transit 2050 plan.

Research by the Phoenix Department of Public Transit projected Prop. 104 would generate $16.8 billion in revenue over a 35 year period. Thirty-five percent of the revenue is allocated for the light rail, according to the department's website.

Roughly half of that will go toward the new construction, and the remainder for maintenance of the existing line, the department said.

In all, the Phoenix Public Transit Department projects the city would contribute $3.2 billion in sales tax for construction of new light rail.

Gudino believes the money should be used elsewhere. More than $250 million is invested in the South Central line alone, which is significant, she argued.

"Instead of going to extensions, the money could go towards improving street infrastructure. It wouldn't just be in south Phoenix, it'd be throughout the whole city."

City funds redirected, federal and regional money would be lost 

Scott Smith, the CEO of Valley Metro, somewhat disagrees with the light rail opponents. 

"It is partially accurate. Mostly inaccurate," he said, referring to their claim of billions becoming available if light rail extensions die. "Their initiative only affects the items recently passed in the T2050 plan. That means only the city funds would be able to be redirected to other projects."

"If there was a cancellation, city funds would be available, but at least $2 to $3 billion of the net funds available from other sources would be gone," he argued.

MORE:10 years and $2B later, what is the future of light rail in metro Phoenix?

Funding for the light rail comes from a mix of federal grants, regional transportation funds and city of Phoenix funds, according to Smith.

Valley Metro breaks down light rail funding sources as followed: 

• Federal grants, 45% to 55% of project costs, or $3 billion to $3.5 billion
• Regional funds, 20% to 25%, or $1 billion to $1.5 billion
• City of Phoenix, 20% to 25%, or $1 billion to $1.5 billion 

But the city of Phoenix has a larger projection — $3.2 billion — for the city's contribution.

Brenda Yanez, spokesperson for the Phoenix Department of Public Transit, said the city included the capital costs, as well as operational and maintenance costs, in its estimate. Valley Metro, she said, appears to only include the capital costs, or the basic investments. 

Some of the $3.2 billion has already been moved out of light rail construction because the Phoenix City Council delayed a planned line, Yanez said.

In an email to The Arizona Republic, she wrote that $153 million "was reallocated to street maintenance from the delay/elimination of the West Phoenix (Camelback) extension."

The city's contribution is smaller, therefore, "leaving just over $3 billion in future sales tax revenues available to reallocate if the (Building a Better Phoenix) initiative passes," Yanez said.

Regardless of the varying projections, Valley Metro has emphasized that if the light rail extension were canceled, the city funds could be redirected, but the federal and regional funds would be lost. 

"The majority of federal funds are project specific and will disappear if the light rail projects aren't built. Regional funds are not available for non-rail projects under existing Valley Metro policy," Smith said.

"At the end, we would end up losing billions in infrastructure funding."

Bottom Line:

If voters choose to end light rail expansion in August, the funds generated by the city transit tax and intended for future light rail construction would be redirected to separate transportation projects.

Estimates vary regarding the amount of revenue the city is projected to invest in light rail over the next decades, so it is unclear exactly how much would be freed to redirect to other projects. The figure also could fluctuate with changes in sales tax revenue. Still, the estimates are reasonably in the billions of dollars. 

What do you think about the light rail expansion? Reach the reporter at annalee.monroe@azcentral.com. 

SOURCES: Building a Better Phoenix website; Transportation 2050, City of Phoenix website; Phone interview with Susan Gudino, treasurer for Building a Better Phoenix, April 16; Phone interview and email exchange with Scott Smith, Valley Metro CEO, April 16; Email exchange with Brenda Yanez, spokesperson for Phoenix Public Transit Department, April 17; "Phoenix voters could kill light rail to these 6 neighborhoods," Arizona Republic, April 15, 2019; "Plan to kill light rail in Phoenix will be on August ballot, judge rules," Arizona Republic, April 12, 2019. "Officials: Extension needed for transportation tax," Arizona Republic, Dec. 2014; "Light rail threatening total Prop. 400 package," East Valley Tribune, Oct. 2004.