New Street Rail in NOLA - How the Financing Will Work

(part 4 of 4 - Part 1/Part 2)

Perley A. Thomas streetcar #910, running inbound on St. Charles Avenue

Three new streetcar lines for New Orleans! Sounds exciting, but there's the obvious gotcha to the discussion--somebody's got to pay for it all.

The price tag for constructing the St. Claude, Convention Center, and Loyola Ave. lines will be $212 million.

(details after the jump)

NORTA plans to break this down as follows:

Federal funding:           $ 121 million
NORTA-issued bonds:     73 million
Reserve Funding:             13 million
Cancelled projects:             5 million

The bond issue (which would have to be approved by the state legislature) is possible now that NORTA's credit rating has been re-established post-storm.

The big trick here is securing the federal funds. As Da Paper says:

The RTA strategy counts on getting $95.6 million -- nearly half the project's projected cost -- from a component of the federal stimulus package known as the Transportation Investment Generating Economic Recovery, or TIGER, grant program.

The $1.5 billion fund pays 100 percent of the construction costs of selected projects.

Competition for the grants is expected to be fierce, as transit systems across the nation vie for light rail projects, new buses and improvements to roads and repair and administrative facilities.

What NORTA has going for them is a proven track record of streetcar development. Riverfront in 1988, then expanded in 1997, Canal in 2004, and storm recover, 2005-2008. This is a track record other transit agencies can only dream of (though no doubt they don't ever want to do storm recovery).

The costs of the three proposed lines break down as follows:

St. Claude:    ;     ;    $ 115.2 million
Convention Center:      51.3 million
Loyola Ave.                45.6 million

the $45.6 million for Loyola comes exclusively from the feds.

NORTA, now under management from Veolia Corporation, has a good plan laid out. What's smart is that they've put up three projects, assuming they'll be trimmed back during the process of allocating funds. If the city gets one of the three, we're looking good.

Like any project that relies heavily on federal funding, it's important that our state's Congressional delegation step up and lobby hard for these funds.  That's doubly important for the two Democrats in that delegation, Sen Landrieu and Rep Melancon.  Neither has a good voting record on healthcare reform, so lobbying to bring home serious bacon will help boost their approval ratings.