Northstar Year 2: lower expectations, HIGHER SUBSIDIES

While views vary widely over the wisdom of constructing Minnesota’s firstcommuter rail line, just about everyone agrees the number of riders for the first year of Northstar service fell far short of expectations— 20 percent and 185,000 riders short.

When ridership comes up short, so do taxpayers, who were already expected to subsidize 79 percent of Northstar’s $16.8 million operating costs—before the shortfall. Passenger ticket sales were projected to pay for 21 percent of the cost of train rides, an operating deficit of more than $1 million per month. The final audited 2010 “farebox recovery” numbers for Northstar Commuter Rail will not be available until July.

But we already know that Northstar’s projected operating costs for 2011 will put even more of a strain on taxpayers to pick up the slack. Metro Transit lowered its projected number of passengers for 2011 by 147,000 riders, some 16 percent under its 2010 goal. As a result, Metro Transit raised the amount of its projected taxpayer subsidy to operate Northstar in 2011 to 84 percent, some 5 percent more than its 2010 goal.

“As the first commuter rail line here, first full year projections had essentially no ‘real world’ history from commuter rail operation in this region in their basis,” said Metro Transit spokesman John Siqveland in an email. “Second year projections are based on the first year actual [numbers] from Northstar plus an assumption of growth.”

In 2011, Metro Transit hopes to attract 750,000 Northstar riders, about 40,000 more passengers than in 2010. Compared to last year’s less than expected passenger numbers, Northstar has posted modest increases in riders so far in 2011.

With fewer overall passengers expected to ride the rail service this year than budgeted for in 2010, Northstar’s operating budget was projected to decline slightly from $16.8 in 2010 to $16.5 million this year. Given that assumption, ticket sales are expected to cover just $2.64 million of Northstar’s operating costs.

A 2010 Freedom Foundation of Minnesota report based onMetro Transit statistics calculated that every $14 round trip ticket on theNorthstar Commuter Rail Line costs taxpayers an additional $29.66 in subsidies.



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