The Mayor of Milwaukee wants to build a $65 million two-mile streetcar system according to this LA Times article. From the story:
This attitude is the wrong way to think about transport investment. Transport investment should be about moving people and things, not indirect attempts at industrial, labor or development policy. Contrary to the Mayor's claims, there isn't any evidence that streetcars boost local economies, including in Portland. There may be some redistributive effects as certain types of firms spatially sort and other go out of business during construction, but overall the effect is pretty much zero. Milwaukee has wide roads and lots of parking. Lack of transport access isn't the main problem for economic development there.
Mayor Tom Barrett is the prime mover behind Milwaukee's plan to build a brand-new streetcar system. Bright, modern vehicles would traverse a two-mile route through the city's east side, downtown and historic Third Ward, a former warehouse area now popular for its shops and restaurants.
Barrett, who believes flashy streetcars can revitalize Milwaukee's city front, points to the popularity of the 10-year-old system in Portland, Ore. Today's streetcars, Barrett says, are more about attracting attention than providing transportation.
"I look at this as an economic development tool," Barrett said. "Look at Portland. That system has aided in spurring development and growth, which is what all communities are looking for now."
Milwaukee also has one of the most productive transit systems in the country, and the streetcar would augment the central segments of two of the most popular bus routes (and an extension would more or less replace one entire segment of one of the most popular bus routes). So there is a transportation function for the streetcar, even if Mayor Barrett doesn't find it politic to mention. Of course, there is a valid debate about whether enhanced bus would be a more cost-effective means of improving transportation, but there's no doubt that streetcars would provide more capacity and a better ride for the these popular routes.
I'm not sure how you are defining productive. Stories like these: http://www.jsonline.com/news/milwaukee/report-paints-bleak-picture-of-bus-systems-future-f75v5t2-161015515.html
don't paint a particularly rosy picture of the system. It's not clear that the capacity of a light rail is at all necessary, either. Many, if not most, streetcar proposals nationwide project ridership far below train capacity, even after accounting for peak periods.
Another related point is whether federal transportation money should be used for local economic development instead of transportation improvements. There is no national economic case to justify such spending.
I was thinking of ridership per capita, but now that you've forced me to look up sources for my assertion I'm reminded of how well Milwaukee does on farebox recovery. That's all with a system that extends remarkably far into the suburbs for how far east it is. Of course the political situation has been very bad for their transit system for the last 10 years or so, so that's all been sliding downhill.
I'm not familiar enough with their transit system to know where route-level ridership stats are hiding, but I'll point out that the route that the streetcar approximates travels the 3 miles or so between the state university and the downtown through the densest neighborhood in town (15-30 hhs/res. acre for most of the corridor). So I think they could fill an LRV at peak.
But of course the first phase of the streetcar won't travel the length of the corridor because they won't be able to afford that much rail off the bat. I think it's a shame that in order to build a coalition in favor of transit improvements they have to build half as much toy train as they could build of enhanced bus - and pretend it will foster economic development to boot - but I also don't think it's ok to make real people ride slow, jerky, overburdened local buses because in theory there is a more efficient form of transit enhancement than streetcar.
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