Streetcars Still Don’t Create Economic Development

State and Local Government |
By Patrick Tuohey | Read Time 2 minutes

Yesterday, we detailed the ever-shifting claims of streetcar proponents about the economic benefit of streetcars. Numbers have ranged from $750 million to $1.2 billion.

Light-Rail-IconStreetcar supporters cannot agree on the impact because, most likely, the streetcar had no impact on the economic development of downtown Kansas City. The evidence presented in support of the streetcar’s impact is often merely anecdotal and fails to account for the diverted development. In February 2014, we provided a list of studies demonstrating that economic development is not a result of fixed rail. We encouraged streetcar supporters to provide contrary evidence that stands up to scrutiny.

It has been more than a year since we solicited that information, and no streetcar supporters have met the challenge. One attempt was particularly sloppy. Even the Kansas City Business Journal was dismissive of the study, titling their piece, “Streetcar Study: Take It With a Grain of Salt.”

Proponents still make the argument. The developer of the 1914 Main Street development recently added his own take on Twitter, writing, “Have said it before, will say it again: Would not be doing our 1914 Main development if not for streetcar.” But that neglects to mention the fact that the 1914 Main project also received taxpayer subsidies in the form of a property tax abatement.

So we are back to where we started: The streetcar alone cannot be said to have created any economic impact. Quite the contrary, when you look into the claims put forth by streetcar supporters—whether it is regarding the GSACentric, or 1914 Main Street—you find that there are always other more compelling explanations for development.

If this development is occurring because the city is handing out tens of millions in subsidies, why are we also spending tens of millions on a streetcar?

About the Author

Patrick Tuohey is a senior fellow at the Show-Me Institute and co-founder and policy director of the Better Cities Project. Both organizations aim to deliver the best in public policy research from around the country to local leaders, communities and voters. He works to foster understanding of the consequences — often unintended — of policies regarding economic development, taxation, education, policing, and transportation. In 2021, Patrick served as a fellow of the Robert J. Dole Institute of Politics at the University of Kansas. He is currently a visiting fellow at the Yorktown Foundation for Public Policy in Virginia and also a regular opinion columnist for The Kansas City Star. Previously, Patrick served as the director of municipal policy at the Show-Me Institute. Patrick’s essays have been published widely in print and online including in newspapers around the country, The Hill, and Reason Magazine. His essays on economic development, education, and policing have been published in the three most recent editions of the Greater Kansas City Urban League’s “State of Black Kansas City.” Patrick’s work on the intersection of those topics spurred parents and activists to oppose economic development incentive projects where they are not needed and was a contributing factor in the KCPT documentary, “Our Divided City” about crime, urban blight, and public policy in Kansas City. Patrick received a bachelor’s degree from Boston College in 1993.

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