Detroit 'People Mover rail system to nowhere' good example of government 'build it and they will come' boondoggles

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9/4/11, "Editorial: Lessons from the (Detroit) People Mover," The Detroit News

"As a cautionary tale on the risk of betting that government can goose private development with expensive build-it-and-they-will-come projects, few local boondoggles stand as large as the Detroit People Mover.

The rail system circles downtown Detroit and was built in 1987 on the theory that it would help fill office buildings and draw new restaurants, residents and retail outlets. It was also supposed to connect to

• hoped-for subway and rail lines.

But like many government projects built without regard for a return on investment, the People Mover never delivered on its promise.

Ridership never reached the 12 million annual passengers predicted before it opened, let alone the 20 million needed to break even. So the city has kicked in huge subsidies to keep if from shutting down and standing as yet another reminder of Detroit's struggles.

This year, the subsidy was $4.4 million. Ridership is 2.2 million. That means the city subsidized each ride by $2. Passenger fares bring in just $900,000.

The expense might be justifiable if the People Mover had sparked development. But many of the stations are in empty buildings, and there's no noticeable concentration of commercial activity around the rail stops.

Part of the problem is that too many of the stops are in parts of downtown that are sparsely occupied. Development downtown has been largely away from People Mover stations.

For example, the nearest stops to Comerica Park and Ford Field

• still require a considerable walk.

The Detroit City Council is rightly cutting the subsidy and asking for a 25 cent increase in the fare, which hasn't been raised since the system was built. The city is also selling advertising on the People Mover cars and naming rights to the stations.

Detroit is now moving ahead with plans to build a light rail system up Woodward Avenue from downtown. It's an ambitious project funded with private and federal dollars.

Once again, the promise is that the rail line will hasten downtown's recovery and spark pockets of development around the stations.

It's an enticing project. But we hope the city will be more realistic in its ridership estimates, as well as projections of spin-off economic benefits, before taking on annual operating subsidies that could dwarf what it takes to keep

• the People Mover-to-nowhere

• spinning nearly empty cars around downtown."

via Lucianne