Northstar Running An Operating Deficit of More Than $1 Million a Month

Good Deal for Riders Leads to $7.5 Million Subsidy So Far This Year

The Northstar Commuter Rail line between Big Lake and Minneapolis has run up an operating deficit of more than $1 million per month so far this year, according to figures obtained by the Freedom Foundation of Minnesota. 

Newly available statistics show Northstar passengers have paid about 17 percent of the actual cost of operating the commuter rail line, leaving taxpayers to pay the remainder, a total subsidy of more than $7.5 million through July 31st. When Northstar began service in November 2009, officials projected that passenger fares would cover about 20 percent of the operating costs of the commuter trains.

The average passenger fare to date is $3.74 per ride, while taxpayers kicked in an $18.74 subsidy per ride. The total average cost was $22.37 for each one-way trip taken on Northstar in the first seven months of operation in 2010.

The so-called “farebox recovery” numbers reveal a wide gap between the cost of operating Northstar and the revenue generated by riders of the controversial commuter rail line. The results were provided to Anoka County Commissioners by the Northstar Corridor Development Authority.

The key figures through July, 2010 include:

  •  Average cost per one-way trip: $22.37
  •  Average passenger fare per one-way trip: $3.74 (17%)
  • Average taxpayer subsidy per one-way trip: $18.74 (83%)
  • Total amount of passenger fares: $1,517,081
  • Total amount of taxpayer subsidy: $7,559,765
  • Total cost to operate Northstar: $9,076,846
  • Total number of passengers: 405,702

The operating deficit comes at a time when regional rail authorities in several metro counties are planning to raise rail tax levies significantly. The Anoka County Regional Rail Authority recently voted to increase its tax levy up to 45 percent, a $2 million hike. The Hennepin County Regional Rail Authority just approved a tax levy increase of up to 20 percent, a $3 million jump if it receives final approval in December . The tax hikes will be used in part to begin expanding train service to St. Cloud, despite low ridership on the current Northstar Link shuttle busses from St. Cloud to the Big Lake rail station.

The Anoka County Regional Rail Authority was fifth highest on the list of Minnesota local governments spending taxpayer dollars to lobby in Washington, D.C, recently disclosed by FFM. According to federal lobbying records, the Anoka County Regional Rail Authority has spent $369,000 of taxpayer funding to lobby federal officials since 2006.                                                                          

                      Tips, questions, or concerns?  Contact Tom Steward, FFM investigative director. 

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