With skyrocketing gasoline prices and mounting worries about global climate change, the need for RTD’s FasTracks rapid transit plan becomes more obvious every day.
But the same problems that are driving more commuters to consider switching to transit are complicating the problem of financing what was originally billed as a $4.7 billion project.
Now, the Regional Transportation District is increasingly turning to public/private partnerships to turn that vision into reality. Given the alternatives facing transit planners, The Post applauds the move.
Rising prices on such basic items as steel and concrete have helped boost the price tag for FasTracks to $6.1 billion.
Meanwhile, the soaring cost of fuel has not only increased RTD’s operating cost for the diesel fuel that powers most of its existing bus fleet, it’s also reduced revenue from the 1 percent sales tax that is the agency’s key means of support.
Gasoline isn’t subject to the general sales tax, so if a motorist’s weekly gas bill doubles to $100 a week, that’s $50 less that same resident has for optional spending, like dining out, that would be taxable.
But inflation poses an even more direct threat to FasTracks. RTD’s enabling legislation limits it to paying a total of $7.2 billion in principal and interest for FasTracks.
Thus, simply borrowing more money and stretching out bond repayments over a longer period isn’t a practical way to handling rising construction costs.
However, money invested by private firms in the project doesn’t count against RTD’s borrowing limit and operating payments to private partners don’t count as interest. Additionally, private firms can benefit from investment tax credits that RTD can’t use.
Finally, from the standpoint of foreign investors such as Brisa Auto-Estradas, operators of the Northwest Parkway, there’s the embarrassing fact that runaway federal budget deficits and a worsening balance of trade have combined to make the U.S. dollar virtually a Third World currency. Foreign investors with access to hard currencies like the Euro or pound can thus buy or build U.S. infrastructure projects at bargain rates.
Last year, RTD used such a public/private partnership deal to electrify the proposed Gold Line to Arvada and the train to DIA. With diesel prices now hurtling toward $5 a gallon, that switch will save many millions in future operating costs.
Now, RTD is looking to team even more comprehensively with private companies to finance, design, build, operate and maintain three key elements of FasTracks, the aforementioned Gold and DIA lines and a commuter-rail maintenance center.
Public/private partnerships have their critics. But when they help taxpayers and the environment alike, we applaud RTD for using them.
