Light Rail

Double Standard in City Spending Priorities

By Nicholas Kevlahan
Published January 19, 2011

Last week, city staff announced that the City's expected capital contribution to LRT would be $130 million, with $12-15 million in annual operating costs and $8.6 million in increased city service costs.

To understand these numbers, it is important to break down the cost of building LRT into the LRT construction itself as well as road and utilities re-construction, which would have to be done anyway. Part of the problem with the City's budgeting approach has been to broadcast a 'grand total' without explaining the breakdown.

The City also needs to provide the benefits at the same time as the costs, and to highlight the net benefit.

I was disappointed, but not surprised, that when the $130 million figure came out, many councillors immediately said it was too expensive and the City couldn't afford it.

Then, just a few days later, councillors supported a staff recommendation to begin spending tens of millions of dollars per year extra on road maintenance, with the money coming from other departments!

We keep hearing calls for the city to consult the public more on LRT (at a time when Rapid Transit staff have run and are planning dozens of public open houses), and that we need to study the net benefit (which has already been done).

In contrast, there is no call to hold no open houses or provide detailed cost-benefit studies on the value of spending $50-100 million per year on roads!

Nicholas Kevlahan was born and raised in Vancouver, and then spent eight years in England and France before returning to Canada in 1998. He has been a Hamiltonian since then, and is a strong believer in the potential of this city. Although he spends most of his time as a mathematician, he is also a passionate amateur urbanist and a fan of good design. You can often spot him strolling the streets of the downtown, shopping at the Market. Nicholas is the spokesperson for Hamilton Light Rail.

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By Mark-Alan Whittle (anonymous) | Posted January 19, 2011 at 11:15:50

Should Hamilton raise property taxes to pay for Light Rail Transit?

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By nobrainer (registered) | Posted January 19, 2011 at 11:18:14

Should Hamilton raise property taxes to pay for roads we can't afford to maintain?

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By MattM (registered) | Posted January 19, 2011 at 11:24:38

A smarter move would be to seriously clamp down on the out of control suburban housing developments that are creeping farther and farther outside of the urban area and impose some real intensification guidelines in regards to mixed use development and public transit initiatives.

But no, that's not "business friendly". That's just hippy economics.

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By matthewsweet (registered) | Posted January 19, 2011 at 11:54:52

But you see, roads are accepted as a fact of life and "everyone" uses them, whereas transit is for those who can't yet afford a vehicle or are otherwise disadvantaged.

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By Undustrial (registered) - website | Posted January 19, 2011 at 12:18:17

If $125 million for upgrades to a football stadium is worthy of consideration, then $130 for a cross-town rapid-transit route is a bargain.

A single cloverleaf interchange can cost tens of millions. A few kilometres of in-city highway can get into the hundreds. And then there's the massive personal cost which gets downloaded onto individuals for fuelling, storing and servicing these massive mechanical beasts.

LRT cannot be considered out of a larger context.

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By hammy (anonymous) | Posted January 19, 2011 at 13:01:35

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Comment edited by hammy on 2011-01-19 13:02:06

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By A Smith (anonymous) | Posted January 19, 2011 at 13:11:34

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By Bond (anonymous) | Posted January 19, 2011 at 13:12:02

Why not get a tiny bit creative? The city could issue a municipal LRT security in anticipation of future tax assessment growth.

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By HamiltonFan (registered) | Posted January 19, 2011 at 13:30:04

Good read Nicholas. Part of me wishes the automobile was never invented but that's living in a dreamworld. I do support though upgrading and enhancing public transit as the price of gas continues to soar and there may well be a day when I can't afford to drive a vehicle any longer, especially when I retire, or when I won't be able to drive a vehicle but still have a need to get around town.

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By Ezaki Glico (anonymous) | Posted January 19, 2011 at 13:37:12

@ A Smith

Burlington is hitting build-out inside of 5 years. If it has frozen suburban development (and I'm not sure that it has), it's in reaction to this fact, and not because of progressive vision. Regrettably. Despite this fact, there is real and considerable opposition to density in the city's core. The dialogue around the Molinaro Group's Strata project gives you an idea of the temperature. The psychology of Burlington taxpayers is just as interesting and conflicted as that of Hamiltonian taxpayers.

Build-out has also featured in Hamilton's development thinking, though in a slightly different way. I'm sure someone can dig up the corroborating details if they root around in the library's microfilm, but at one point Mayor Wade's solution to downtown decline was to build out, the theory being that once you've made all other options unavailable, that developers and politicians would have to address downtown. That "waiting game as proactive" strategy is flawed on any number of levels (especially as it was formulated in a pre-greenbelt Hamilton, where there were potentially generations of suburbs you could greenlight before you'd ever have to focus on the core), but I wonder how many projects that have been approved from that era are still in the pipes, as it were.

Pipes that the city will have to install at a loss, of course.

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By Zephyr (registered) | Posted January 19, 2011 at 14:44:15

I know little about LRT and the proposal for Hamilton. But have been reading with interest. My suspicion is that North America is lagging quite a bit behind Europe in urban development, but we are following them slowly. Which means that downtowns will continue to intensify (and gentrify), while suburbia will be where people are forced to live. I suspect we need to look to a future where Boomers will want to live and play in our downtown. Demographics and rising oil prices both point to a time when mass transit will become dominant. I lived in London, UK for 4 years quite happily without a car, although must admit am far from being able to do that over here... yet.

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By JMorse (registered) | Posted January 19, 2011 at 15:01:46

The city needs to market LRT far better than it has. The manner in which figures are announced is an example of how not to get public support for transit. Car culture permeates our society through the media, but transit can only be promoted by its advocates. The message needs to be louder and clearer to create a critical mass of advocates, or LRT will not come. The city needs to be more organized and disciplined with their approach.

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By jason (registered) | Posted January 19, 2011 at 16:51:04

The city needs to continually splash photos of new mixed-use developments along LRT lines from Portland, Charlotte, Europe, Vancouver etc..... to the public in Hamilton and sell them on OUR OWN King St looking like that. Citizens don't understand LRT. But almost everyone (apparently other than folks who comment underneath Spec articles) has travelled and seen successful streets and successful cities. And everyone loves them. Who would object to King and Wentworth looking a little more like this:

http://www.flickr.com/photos/12208406@N0...

http://www.flickr.com/photos/35614822@N0...

  • kinda looks like the escarpment in the background....hmmm....

Comment edited by jason on 2011-01-19 16:51:14

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By Cityjoe (anonymous) | Posted January 19, 2011 at 17:15:17

@transitstudent who said, "But you see, roads are accepted as a fact of life and "everyone" uses them, whereas transit is for those who can't yet afford a vehicle or are otherwise disadvantaged."

That is not the case in most major cities in N. America. It's just the case in places that are 30+ years behind the times. :( Or places that have placed nothing into a transit system for so long, so that it becomes unworkable.

Most people in NYC, London, Paris, or Toronto don't bother with a car for daily use. They might own one, or rent one to go out of town, but transit or taxis are the best method of getting into the city core. However taxis can still be a problem when accidents stop traffic.

I think the biggest problem that Hamilton has is this 'car-centric myth' that a car denotes affluence, & all who don't own one must be poverty stricken.

Any damn fool can own a new car! 0% down & 1% to 3% interest for the 1st 4 years was the buzz word this past season. Does that strike you as something out of reach of the average wage earner?

Repeat after me. "I am Not my car. I am Not my car. My car will be nearly worthless in 10 years, & I will not."
"My car does not give me added sex appeal, & the size of my vehicle does not approximate the size of my penis/ or breasts."
" A new convertible does not take 10 years off my actual age, or 6 inches off my waste line. It's just a damn car."

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By sbwoodside (registered) - website | Posted January 19, 2011 at 19:52:07

Nicholas, or someone else, can you elaborate on the $50-100 million per year spending on roads figure?

It would be pretty convincing for example if we had precise annual figures for roads vs. LRT investment. The LRT numbers are totally out of context right now. But think about all the money we could SAVE on roads if we didn't have to use them as much!!!

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By arienc (registered) | Posted January 19, 2011 at 22:23:43

sbwoodside...the city doesn't exactly tell us what it spends on roads.

Based on the 2009 financial statement, the total book cost for 'Roads" in the city is $1.888 billion. $45 million was added to the cost account during the year, while total depreciation increased by $73 million. Note that depreciation is based on original cost, not current replacement value. In addition there is $11 million "under construction". So in terms of capital expenditures, it would appear the city recognized about $56 million for the year, which is less than the depreciation charges the city took against those roads.

The city also payed operating costs in 2009 of $326 million for "transportation services" including roads, and $234 million for "protection services" including enforcement of rules of the road. No breakdown of how much of those line items actually went to roads is available.

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By jason (registered) | Posted January 19, 2011 at 22:29:13

anyone attend the LRT open house tonight? If so, any news?

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By say what (anonymous) | Posted January 19, 2011 at 23:25:43

I attended and came away without any concrete answers about what the fare structure will look like, what the plan is to reroute traffic around Main from the delta to the traffic circle, whether the crosswalk on my street was a traffic signal or a stop sign, what the costs of construction or operation would be as there seems to be no concrete numbers, etc. I specifically tried to talk nuts and bolt of HOW the system would work and got no answers. The people seemed to be ill prepared to answer specific questions about my concerns about logistics but more concerned about selling me on the perceived investments that he believes will surly follow. I left disappointed that it wasn't about taking public input about station stops and concurrent bus service adjustments required with LRT implementation. I was also very disappointed with the poor reception I received when I suggested BRT was a cheaper better option. Instead of receiving public input the goal was to sell a project IMO.

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By matthewsweet (registered) | Posted January 19, 2011 at 23:46:17

whether the crosswalk on my street was a traffic signal or a stop sign

??

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By say what (anonymous) | Posted January 19, 2011 at 23:56:21

Hey they had all sorts of beautiful graphics showing stops turns allowed or not even crosswalks. Cant have a crosswalk without a stop sign or a traffic signal. Nobody knew which it would be. Has to be a light that isn't there now but they didn't know what there drawings depicted. Yes I expect them to be able to decipher their drawings

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By sbwoodside (registered) - website | Posted January 20, 2011 at 02:16:26

@arienc Normally depreciation would be equal to replacement value in any normal accounting system. Why do you say it isn't?

I think your $1.888 billion would be the book value right?

Then I would call the $56 million "spending" on roads and the $73 million "loss in value". Which means that the city was not replacing the roads as quickly as they were degrading in 2009.

In other words... the city spent $56 million on roads in 2009, and still didn't keep up with necessary investment according to their own accounting system.

Now, all of the above would account purely for the tarmac, right?

You also talk about "transportation services" at $326 million. Does that include the full $56 million from above, or is it a separate expenditure? What percentage of transportation services would be services related to roads? What other kinds of transportation would they be servicing, aside from buses?

What's "protection services"? Is that police, fire, ambulance, that kind of thing?

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By sbwoodside (registered) - website | Posted January 20, 2011 at 02:21:43

@Nicholas, shouldn't the $130 million be amortized over some period of time? How long will construction take? How long will the system last before it needs major reconstruction? If it's 30 years then the cost would be much lower on a yearly basis.

Also, how do rails compare to roads in terms of how long they last and how much repair costs they incur each year?

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By jason (registered) | Posted January 20, 2011 at 09:04:40

@ bysaywhat, not sure why the downvotes. I appreciate you answering my question. I wish I could make it to one of these open houses, but the times just don't work. I heard on another forum that they are looking at closing King St to vehicles from Mary to Walnut. One block seems kind of odd.

EDIT: FYI, the BRT vs LRT discussion already happened a couple of years ago and LRT came out the clear winner and there was a ton of public input and that input was also very heavily in favour of LRT. That's possibly why you aren't sensing too much reception to the BRT idea being brought up again.

Comment edited by jason on 2011-01-20 09:05:50

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By say what (anonymous) | Posted January 20, 2011 at 09:39:16

The downvoting is expected and not bothersome, kids will be kids. Anyway, The LRT vs BRT debate isn't likely done due to the enormous costs involved that are still just an estimate of $860M. I genuinely tried to stay away from the money issue When it was thrust upon me repeatedly with the perceived paybacks of LRT and they refused to accept that I didn't want to discuss that but rather station stops, crosswalks, closing streets and potential alternate routing, etc I tried to rebut reason with reason on the economic model. At that point it became a constant "when rubber meets pavement" philosophy lesson that I was not looking for. I've read the 93 page report cover to cover at least 10 times and am intimately familiar with the reasoning and told them so yet they persisted. It was quite aggravating. It was very clear that the person I talked to had no interest in hearing the public's opinion but rather was looking to sell his vision

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By FTFY (anonymous) | Posted January 20, 2011 at 09:42:39

"It was very clear that the person I talked to recognized me as a major troll who had no interest in an honest discussion about the economics of LRT."

FTFY

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By jason (registered) | Posted January 20, 2011 at 09:50:12

It was very clear that the person I talked to had no interest in hearing the public's opinion but rather was looking to sell his vision

I think this is part of their role now. As I said, the BRT v. LRT evaluation has been done and it's proven that LRT will be a far better investment over the long term, even with it's more expensive capital cost. The city NEEDS to sell the vision now. Folks who think it's simply about transit will likely wonder why we're going for the more expensive option. It's about a whole lot more than just good transit.
The city needs to educate the public on this so they understand the scope and value of the investment.

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By say what (anonymous) | Posted January 20, 2011 at 09:52:58

Its is very clear that FIFY doesn't know how to act like an adult. Trying to get me to go postal like Hammy is childish and actually makes you the troll. I'm not commenting any further on this obvious breach of forum rules from him or any others that wish to engage in it.

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By JMorse (registered) | Posted January 20, 2011 at 10:04:40

@ jason

At last night's meeting, my question were about marketing the project to the public. My concern was that all of the investment in planning, design, and public input would be wasted if not supported by a public awareness campaign. No business would invest so much without being sure that the market wouldn't be attracted to it.

The responses I received were that, though marketing the project to the public is necessary for LRT to proceed, it's not the role of the Rapid Transit team to promote it more than they are doing now. It's up to the current advocates to reach out to our elected representatives and the public to get them on side.

During a conversation with one of the team, I over heard an older couple saying "if it doesn't ease congestion, why are we doing this?". I then directed the team member to go tell them why, adding that "Hamilton doesn't have congestion, it needs congestion!"

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By say what (anonymous) | Posted January 20, 2011 at 10:10:33

Selling "Hamilton doesn't have congestion, it needs congestion!" is pretty much an impossible sell to a very large number of people. I'd say the majority but then somebody would accuse me of speaking for others.

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By JMorse (registered) | Posted January 20, 2011 at 10:20:48

It was more of an advocate's observation, not a suggested pitch to use in selling LRT.

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By Tnt (registered) | Posted January 20, 2011 at 10:31:26

Filling in for zookeeper: DON'T FEED THE TROLLS!!!!!!!

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By seancb (registered) - website | Posted January 20, 2011 at 11:54:50

In the news today: http://www.lgl.ca/Highway5and6Interchang...

How much is this highway 5/6 overpass interchange going to cost the city, and where are the spectator headlines? Nowhere to be found - just a paid-for-by-the-government "public notice" on the second to last page of the paper.

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By seancb (registered) - website | Posted January 20, 2011 at 12:00:05

And then we have this:

[...] Will the LRT be of any benefit to those who live along the line, but work out of town? They will still need their car to get to and from work, but with the LRT taking up their route, it will take them that much longer to travel using side streets. http://www.thespec.com/opinion/letters/a...

What a sad state of affairs we are in when we have so little hope for this city that we want to build a downtown whose sole purpose is to provide through access for people who work on one side of the city and have to go through it to get to their job in another city.

How about looking at ways to make the downtown an attractive place for employees and employers to settle down?

My advice for people who work outside the city is to live in a part of the city that does not require you to drive through downtown to get to work. This type of commuting is only possible now because we have made it possible. In every other city in the world, before taking a job or buying a house you would think long and hard about putting the downtown core between you and your work, knowing full well that it makes no logical sense to commute through the centre of town twice a day

Comment edited by seancb on 2011-01-20 12:02:42

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By nobrainer (registered) | Posted January 20, 2011 at 13:00:23

How about looking at ways to make the downtown an attractive place for employees and employers to settle down?

You mean like it already is? It's easy to say there's no point in doing things to improve downtown because downtown is dead, but downtown isn't dead at all, I live there and work there and hang on, BRB ... yep, I still have a pulse. The biggest thing holding downtown back from even bigger success is our downtown highways and the fact that transit is still a second class way of getting around.

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By Undustrial (registered) - website | Posted January 20, 2011 at 13:06:55

The highway 5/6 interchange is a perfect parallel here. Whereas LRT would generate investment and development along established inner-city corridors, highway spending generates and supports development along rural corridors (ie: sprawl). It's pretty clear that this is a blatant gift to the big-box developers who've sprung up there in the past few years.

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By jason (registered) | Posted January 20, 2011 at 14:17:44

LRT info now available. I like it.

http://www.hamilton.ca/ProjectsInitiativ...

The video is deadly.

I agree with above posts. Commuting through the heart of downtown is a stupid idea, but if it needs to be done - use Hunter, Charlton, Cannon or Wilson. It's not that hard. I like this plan at the Delta of re-routing Main St through traffic onto King for a couple of reasons (and some other points) :

  1. it will break Hamiltonians out of this ridiculous high-speed, short-cut through town mindset
  2. It makes some good use of the RHVP for folks wanting to drive to Eastgate Sq. They can head east on King from Main and then head up on the RHVP to get to Queenston. This may add a couple minutes onto their car trip?? No biggie at all.
  3. It gives Main St businesses a fighting chance along there. Street parking, LRT and only 1 lane of live traffic will create a great neighbourhood retail node for this dense family neighourhood.
  4. I have no clue what they are trying to do with that one block of eastbound car traffic on King between Catharine and Mary (I think?) but it seems weird. Other than that, I LOVE the International Village concept.
  5. The King St cross section works for me. This was common in Portland. One or two lanes one-way with LRT having it's own lanes. Yes, one ways can be safe, calm and enjoyable. See St Catharine St in Montreal.
  6. Seems to me there should be a stop at Locke
  7. Let's assume that Main St will be narrowed down to 2 vehicle lanes, parking lanes and perhaps even a 2-way bike lane through the entire city, or simply converted to a traditional 4-lane two-way street (this idea makes the most sense IMO)

Overall, good design and good re-routing of the other bus routes. This is a once in a lifetime chance to transform this city. Will we take it??

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By SpaceMonkey (registered) | Posted January 20, 2011 at 16:15:03

Overhead wires?! Oh gawd.

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By jason (registered) | Posted January 20, 2011 at 17:08:16

what? I love overhead wires. Adds a great sense of urbanity to a city. Mind you, these are only single lines, so not as busy as the overheads in Vancouver. How else do you expect the electricity to run to the LRT??

http://www.flickr.com/photos/aecreations...

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By A Smith (anonymous) | Posted January 20, 2011 at 20:20:41

I will admit, downtown Portland looks really nice. Trolley cars, nice sidewalks, lots of one way streets (which apparently don't seem to hurt pedestrian traffic), but there is one other thing that Portland has...

$4.1849 Billion in city debt. In contrast, Hamilton has $998 Million. Portland has a population of 550k, Hamilton 525k.

From 2005-09, Portland had city (non grant) revenues increase by around 16%. Hamilton's (non grant) revenue jump was 24% in the same time frame.

LRT may make the city of Hamilton more livable, but if Hamilton's experience is similar to that of Portland, it may also lead to much higher debt levels and slower revenue for City Hall to spend on other things. Something to consider when selling the benefits of LRT to taxpayers.

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By jason (registered) | Posted January 20, 2011 at 20:38:11

not to get right off topic, but I remember when I lived in Portland that the 0% sales tax was always a big battle ground. On one hand, consumers and retailers loved it. Tourism ads would try to lure people into Oregon due to the cheaper shopping. On the other hand, there were those who warned that the city needed to have that income or risk falling further into debt....which they have. As the major city in the state, the revenue that could be generated and sent back into city coffers from the state would be tremendous if they had even a smaller sales tax than most.
I'm no expert on their situation, but obviously it isn't a pressing enough issue yet in their minds or some changes to their tax structure would have begun. I'm not certain that comparing a Canadian and US city with respect to taxes etc.... is really useful, but I appreciate the info on Hamilton's situation. Glad to see we are faring decently, especially after a couple of really crappy decades.

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By A Smith (anonymous) | Posted January 20, 2011 at 21:13:23

Jason, maybe you are right and I am wrong. Portland has around $7.6k debt per capita and a lot of people seem to like it. Toronto has around $4k debt per capita and it is more popular than Hamilton, which has only $1.9k. New York City has $21.8k debt per person, 10x more than we do and it is the leading city in the world.

I ask you guys to prove that LRT will be a good investment, but maybe that's the wrong question. Maybe Hamilton (which probably just means me and a few other eggheads) should follow the teachings of Jesus and stop worrying about money? You are a minister, what do you think?

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By jason (registered) | Posted January 20, 2011 at 21:41:30

LOL. you might be onto something.

Those really are fascinating stats. So, cities that are considered the most vibrant, livable, successful, economically prosperous etc....all have way higher debt loads than less successful cities?? You may have just stumbled across a really crazy stat.
I believe in LRT for all of it's economic development potential and thrust in rebuilding our city, but I've never been one to suggest that we just go crazy with our spending and rack up the debt. But maybe we should??? lol. that's an eye-opening batch of stats.

Comment edited by jason on 2011-01-20 21:42:21

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By Ryan (registered) - website | Posted January 20, 2011 at 22:05:33

There's nothing wrong with debt per se; in fact it's the cost of doing business. The two important questions to ask are:

  1. Are you incurring debt to acquire an asset that will generate an increase in net value?
  2. Can you afford to service the debt?

LRT is more expensive to build and operate than buses, but it also generates a bigger net benefit. As Nicholas argues, it is misleading to focus on the cost without putting it into the context of the corresponding benefit.

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By SpaceMonkey (registered) | Posted January 20, 2011 at 22:55:57

Jason said: what? I love overhead wires. Adds a great sense of urbanity to a city. Mind you, these are only single lines, so not as busy as the overheads in Vancouver. How else do you expect the electricity to run to the LRT??

Most people (including me) find the overhead wires ugly. Some cities have gone to great lengths to hide wires. Other cities wish they could/had.

To answer your question though... they seem to do it pretty well in San Francisco ;) (Just teasing)

One example of a set up that doesn't have overhead wires is Bordeaux. Imagine the scenes in this video with poles and wires clogging up the streetscape.

Comment edited by SpaceMonkey on 2011-01-20 22:58:50

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By jason (registered) | Posted January 20, 2011 at 23:07:50

Bordeaux is so cool.

Here is the ground source electrical info:

http://en.wikipedia.org/wiki/Ground-leve...

I find the Hamilton LRT proposal to be clean and not too cluttered due to the single wire for each train. It's not like we're going back to these days:

http://transit.toronto.on.ca/images/trol...

Although I must come clean - I love the mass of overhead wires. Call me crazy. I also love freezing cold, crisp mornings like we had today. lol.

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By Undustrial (registered) - website | Posted January 21, 2011 at 10:52:46

Oh Portland. North America's best and worst example of New Urbanism. Problem is, they have so much more than LRT (a firm urban boundary, building height restrictions etc) that it's very hard to tell what's going on from any cursory look at a few key numbers.

All this talk about cost and debt reminds me of an old quote from an American politician. He stated that originally he'd been dead-set against the mass transit system proposed for his city because "for that price, you could buy everybody a Buick". Decades later, he confessed that "it's a little more like buying everybody a Buick that lasts for thirty or forty years". Really wish I still had that source.

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By Paul (registered) | Posted January 22, 2011 at 19:42:48

@transitstudent

Sorry if this has already been addressed (there are so many comments) but tranist is for all. This backward idea that one is somewhat inpaired so they use transit is more of a self-fulfilling prophecy than actual fact.

I for one use transit by choice and am quite capable of driving and keeping a car but choose not to.

If more saw transit for what it is and could be, it's inportance would be finally realised.

Sure the poor and handicapped use it and many may because they have to. But it is not a charity ride but a viable method of transportation in many instances and could be even more if it was improved and treated more fairly.

Indeed as it is provided for public use there should be more incentive to improve its viability and encourage its use rather then relagating it as some trasnport for the students, poor and the unwell.

Part of the potential charm of LRT is it does not hold as much of the same stigma and will hopefully dig Hamilton out of the transportation dark ages it has sat in for so long.

But by the looks of things so far, more lip service and "studies" are being done for the LRT than anything actually concrete in seeing it actually come to be implemented in our lifetime.

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