August 24th Transportation Policy Board

I attended the August 24th transportation policy board to hear about the progress the ERA consultants had made so far on their economic study of light rail in Memphis. As I understand their charge, the consultants are going to study the economic impact of light rail development in Memphis and the surrounding region. To do this they needed a test corridor, something on the ground to run the numbers against. It would be too difficult to run an economic study without a specific light rail corridor due to the spacial characteristics of most economic factors. The economic impact of this corridor would then be compared to the economic impact of the same study area without a light rail line. By studying the economic impact with and without the corridor the consultants will be able to tell if the light rail corridor will have a positive, neutral or negative economic impact.

The two main economic indicators the consultants will be comparing are job growth and the gross regional product, a regional version of the gross national product. Using these indicators they should be able to tell which alternative is better economically for Memphis, light rail or no light rail. It is important to note that since the economic study is "site specific" the study is not saying whether or not light rail is good for Memphis only whether a light rail corridor at the locations studied is good economically for Memphis.

The next topic discussed at the meeting was the actual process of selecting the corridor for the study. The consultants evaluated four different corridors based on these five criteria: 1) potential ridership, 2) potential for creating transit oriented development (TOD) 3) right of way capacity 4) capital costs and 5) impact on existing businesses. The four corridors evaluated were: 1) Poplar corridor, 2) Summer Corridor, 3) Northern Corridor, similar to the corridor identified in the light rail Regional Rail Plan and 4) the CSX corridor. Based on the above five criterion the consultants choose the CSX corridor as their preferred corridor of study. They also said that at no additional charge they would study the Lamar Corridor as well due the fact that extensive research had already be completed for the corridor and that it had been selected as the preferred light rail corridor from Downtown to the Airport.

The consultants have already submitted two papers. The third paper will be case studies of what they call peer cities. The three main peer cities they selected were: 1) Baltimore, 2) Dallas and 3) Sacramento. From basic research from these studies they suggested targets or goals for the light rail line such as: 1) stations a mile apart, 2) 1000 trips per station per day, 3) 25% of the operating cost covered by fairs, and 4) a subsidy of around $2 to 4$ per trip. I have requested the consultants powerpoint and will post it here if they send it along to me.

After the initial presentation the questions from the public shifted the focus of the meeting to the Poplar Corridor. It was pointed out that all the major rail studies today have identified the Poplar Corridor as a prime, if not difficult, candidate for a light rail corridor. Those in the audience questioned why CSX was being studied when the Poplar Corridor holds the most promise. There was some discussion on the board and they decided to ask the consultants if they could come back with the price of adding the Poplar Corridor to the study.

ERA Proposed Light Rail Stations

Click on the station locations for a detailed station photo

MPO Meeting

There is an upcoming MPO meeting where the consultants looking at the CSX rail line as a potential light rail corridor will present some of their findings. I received the below information from Allan Lummas' Blog. You can reach his original post here EJ Meets Smart Growth: Agenda for MPO Transportation Policy Board Aug 24, 1:30

Memphis Metropolitan Planning Organization
Transportation Policy Board

August 24, 2006 - 1:30 PM
Central Station Board Room
545 S. Main Street - Memphis, Tennessee

Agenda Packet

1. Call To Order
2. Approval of July 27, 2006 minutes
3. Announcements
4. Approval of FY07 PUBLIC HEARING—ACTION
Item Summary: The draft UPWP has been approved by TDOT and FHWA, and has been through a thirty-day public comment period. No comments were received.
5. Light Rail Economic Impact Study
Item Summary: The consultant team (ERA, Crandall Arambula PC, Kimley-Horn and HNTB) has submitted their first two working papers along with a document showing potential alignments and station locations. TPB approval is sought to move forward with the study of the alignments presented.
6. Reports - UPDATE
Travel Demand Model—Kimley Horn
7. New Business
8. Adjournment

Bad News from CSX

As I was doing my research for the capstone I came across the July 17th Commercial Appeal article "The End of the Line:; Plans to Purchase old Railroad Corridor Screech to a Halt." According to the article the planned purchase price of the rail line was well below the expectations of CSX. In fact there was over a 13 million dollar difference between the price the city was willing to pay and the price the cities own appraiser valued the land at. According to the article:

CSX appraisal of the property last year set its value at $17.8 million. The local governments hired their own appraiser to counter that, but A.E. Balkin & Associates this spring arrived at a sum that's not much lower - $15.7 million. Both appraisals were based on an "over-the-fence" method of setting value. It means the land price was based on what it would be if it was an extension of adjoining property lots. With the high appraisals in hand, CSX rejected a city-county offer of $2 million for the corridor.

Citing their shaky financial situation, the city and county have pulled their bid to purchase the right of way. As a result the status of the greenline and the possibility of a light rail corridor are put on hold. The city believes that they have presented a good package, since it would seem that the only market for the corridor is local government. On the other hand, CSX is a business and seek to maximize profits for their shareholders. From the article:

CSX spokesman Gary Sease said the company is obligated to seek the market price when selling land."We are a for-profit company and we're responsive to our shareholders, so we don't give the property away. We sell it for fair market values,"

With the city and county pulling out of the negotiations the only entity left pursuing the purchase of the rail right of way is the non-profit, Greater Memphis Greenline. It remains to be seen if the non-profit will be able raise the substantial funds needed for the current purchase price.

The central question is what is going to happen now? Does CSX have any other potential buyers to realize what they consider to be the market price of the land? Could they sell the rail right of way to the land owners adjacent to the rail line? It seems to me that if CSX's only option is to sell the corridor in its entirety than the market analysis used by both the local governments and CSX is flawed. Connecting the market value of the corridor to the market value of the neighboring parecls makes little sense if the land cannot be purchased by adjacent land owners. The question then becomes, what is the market value for the entire right of way taken as a transportation/recreational corridor. With either side not willing to negotiate the corridor will be on hold until one or both sides are willing to compromise?