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July 12, 2013

Mayor R.T. Rybak
350 S. 5th St., Room 331
Minneapolis, MN 55415

Dear Mayor Rybak,

The City of Minneapolis is in the process of breaking new ground for the region’s transit system through its study
of streetcar alternatives, in particular through the Nicollet-Central Transit Alternative Study. The City has also
taken the remarkable step of developing and seeking legislative authorization for a value capture funding source
to help fund this project. Given the City’s active pursuit of a first-of-its kind modern streetcar project, I thought it
would be helpful and prudent to outline the Metropolitan Council’s perspective on future development of this
transit mode and regional investment.

The Council’s current Transportation Policy Plan (TPP) is nearly silent on streetcars as a mode of transit in the
region, except for a reference to Council-local government collaboration to determine when and where a streetcar
project might be appropriate. The TPP also states that projects that show a positive, significant, and cost-effective
transportation benefit might be funded with local, regional and federal transportation funds but a project pursued
primarily for development outcomes should be funded locally and should not compete with other priorities for
federal and state transportation funds. With numerous transit corridors identified for future investment, the
demand for transit capital and operating funding greatly exceeds current funding.

Both transportation and economic development serve an important role in helping the region grow in an efficient,
connected manner and provide justification for investment. I understand that project justification for the Nicollet-
Central streetcar is still under discussion by technical staff and policymakers as part of the Nicollet-Central Transit
Alternatives Study. It will be important for the project justification to be well developed and vetted prior to it coming
forward to the Council for consideration.

Work is just now beginning on the next regional TPP. We hope that the City of Minneapolis will play an active role
in the development of the plan, allowing us to have a more robust regional discussion about the potential for
developing streetcars as a transit option.

Because your project is proceeding more quickly than the next TPP, I feel it is important to proactively establish
lines of communication and provide guidance on this project.

       Collaboration: Critical to the success of any project of this magnitude is collaboration between the
        Council and local units of government. In particular, if this project someday comes to fruition, we view it as
        critical that it be integrated into the existing transit system, regardless of how it is funded or which agency
        leads the implementation. It is necessary to include potential funding partners and other stakeholders
        (Hennepin County, MnDOT, Counties Transit Improvement Board) in this collaborative effort. It is also
        important for the City to understand that streetcars merit a regional discussion that results in a regional
        policy. As you are aware, the City of St. Paul is also actively studying a modern streetcar system and
        potentially looking to the region for policy guidance.




 
 
        Funding: As our TPP states, funding for a project like this may be different depending on whether the
         project’s primary function is additional transportation benefits or development outcomes. At this point,
         both scenarios lack a clear funding strategy, such as those that have been used for light rail projects. The
         Council anticipates that with any Locally Preferred Alternative forwarded for Council consideration, the
         City will also provide a funding plan that addresses both capital and operating costs and is consistent with
         the project’s primary function. The Council, the Counties Transit Improvement Board and the City should
         all be at the table when this funding plan is developed. The City should understand that if a streetcar does
         not provide a significant transportation benefit, the Council may not be able to prioritize the region’s
         limited transit funding for a project without a significant local contribution to both capital and operating
         costs. The Council also appreciates the City’s efforts to support additional funding for transit that may
         expand the flexibility to include streetcar.

        Memorandum of Understanding (MOU): If the Council formally takes a position favorable to streetcars
         at some future point, the Council and the City of Minneapolis should seek to enter into a formal
         memorandum of understanding regarding the funding, design, construction, operation and maintenance
         of the proposed streetcar line. While it is ideal for the Council to formally take a position on streetcar as a
         transit mode and on the prioritization of the many competing regional projects prior to entering into such a
         memorandum, we recognize that we may need to be flexible and utilize short term, limited scope
         memorandums between the time a Locally Preferred Alternative is adopted and the time the Council
         takes a formal position on street cars.

As you move through the Nicollet-Central Study and seek to recommend a Locally Preferred Alternative, I
encourage the City to remain in regular contact with the Council. Cole Hiniker (cole.hiniker@metc.state.mn.us or
651-602-1748) will function as your primary staff liaison.

This is an exciting possibility for our region and while there are many unresolved elements, the Council welcomes
Minneapolis as an active partner in the effort to expand transit options in the metro region.

Warmest regards,




Susan Haigh
Chair



CC:
Counties Transit Improvement Board
Mayor Chris Coleman, City of Saint Paul
Commissioner Peter McLaughlin, Hennepin County
Commissioner Charlie Zelle, Minnesota Department of Transportation


 




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