Something to learn from??

[DetroitInJAX]

Excitement, funds build for light-rail link on Woodward

BY JOHN GALLAGHER • FREE PRESS BUSINESS WRITER • September 12, 2008
   
Detroit is edging closer than ever to a new light-rail link from Hart Plaza to New Center as a privately funded transit proposal nears its goal of raising up to $100 million, the Free Press has learned.

The project, now known as the Regional Area Initial Link, or TRAIL, has gotten commitments for about 75% of its goal of raising $90 million to $100 million, a person familiar with the details of the effort said.

In a key fund-raising innovation, leaders of the effort are selling naming rights for up to 13 planned stations along the 3.4-mile route up Woodward Avenue. The rights go for $3 million for each pair of north-south stations. So far, 10 purchasers have committed to buying rights.

In one such agreement, the Wayne State University Board of Governors approved July 30 spending $3 million to sponsor a stop at the school.

WSU agreed to pay the money in $300,000 increments over 10 years, giving WSU the naming, marketing and promotional rights to the stop, according to four of the WSU board governors who joined the unanimous vote and the minutes of the meeting where the measure was passed.

John Hertel, who heads the privately funded TRAIL effort as chief executive of Detroit Regional Mass Transit, outlined plans for the project to the WSU board of governors before the vote.

Diane Dunaskiss, a member of the WSU board, said she and her fellow governors backed the plan with enthusiasm.

"Our goal as Wayne State University, as one of the largest employers and one of the largest institutions in the city, is to connect our campus with the downtown area and to really be a part of the renewal of the city," she said.

In addition to WSU buying naming rights, at least four leading business leaders have agreed to participate in sponsoring the project, including business and civic leaders Roger Penske, Peter Karmanos Jr. of Compuware Corp., Dan Gilbert of Quicken Loans, and the Ilitch family of pizza and sports fame, the Free Press has learned.

Representatives for the business leaders have declined to comment about their involvement.

Having 10 commitments for station naming rights means the project has raised $30 million in that way. Selling rights to the other three stations would push the total from that money source to $39 million.

In addition, the Troy-based Kresge Foundation, which already has donated $50 million to create the Detroit RiverWalk, tentatively has agreed to provide between $10 million and $50 million to back the new transit system, foundation president Rip Rapson said this week. The exact figure will depend on the success of other fund-raising, but is expected to be close to the $30-million to $40-million range.

"It is a lot of money," Rapson said. "We really haven't nailed down a specific number."

Other sources of revenue might include selling naming rights for the entire system and selling advertising on the cars, like the Detroit People Mover.

These new details show that the Hertel-led transit line, sometimes called the worst-kept secret in Detroit, is making substantial progress toward becoming reality. Several obstacles remain, however, including creation of a public-private nonprofit entity to own and run the system.

Also, state legislation is needed to enable creation of the system, and the bills required have not yet been introduced in Lansing. Depending on how much money is raised up front, legislation also might be needed to provide an operational subsidy to carry the system through its first few years.

But if the project gets built, it could substantially boost economic development in the city's center. A study to be released Monday by the nonprofit Transportation Riders United group is expected to say that billions of dollars in new investment would follow creation of a light-rail line. The report, titled "The Economic Case for Light Rail in Detroit," studied such systems in several other cities.

A rail system along Woodward also would give a major boost to an effort to build a rail line from Ann Arbor to New Center. That line, planned by the Southeast Michigan Council of Governments and to be paid for largely with federal money, would feed passengers to and from the TRAIL line, whose existence could help justify the expense of the Ann Arbor-Detroit route.

But the Hertel-led plan faces potential competition from an effort undertaken by the Detroit Department of Transportation, which runs the city's bus system. DDOT also is developing plans for a light-rail system along Woodward that differs in major details from the Hertel-led effort.

To date, the Hertel-led effort and the DDOT effort are proceeding independently. Rapson expressed confidence that the plans could be reconciled.

"I think at the end of the day they're going to hammer out some way to bring the two plans together and they'll be fully complementary," Rapson said. "The stakes are just too high for that not to happen."



If they can do it, why cant we?