Dear Editor:
With Amtrak insolvent despite $24 billion of tax subsidies, and Caltrain earning only about 1 percent of its fully amortized costs from fares, San Benito County residents are asking: “What is the true cost of extending Caltrain to Hollister?”
COG’s consultants reported that it will cost between $20 million and $40 million to restore the branch line to passenger carrying capacity as required by regulations of the Federal Railroad Administration.
Using the historic cost overrun deviation average determined by Professor Levine in his seminal National Transportation Policy: A Study of Studies, we must multiply by 50 percent making it $40 million to $80 million just for infrastructure restoration, not including operating expenses and trackage use fees imposed by UP. Since SBC gets back only 11 cents per dollar sent to Sacramento, SBC’s taxpayers must send between $364 million and $728 million of taxes to get back the money to give to the nation’s 154 largest corporation.
This means a subsidy for each Caltrain rider from Hollister, depending on daily ridership, as follows:
Number of RidersTax Subsidy for Each Rider
100$7,280,000
200$3,640,000
400$1,820,000
800$910,000
1,600$455,000
3,200$227,000
6,400$113,750
This does not include operating subsidies, which will be additional tax burdens on SBC’s small business owners and homeowners.
Therefore, it will be cheaper for SBC’s local government and taxpayers to purchase median priced houses in Gilroy for each Caltrain rider from Hollister, at least until about 1,600 persons ride each day. Until “ridership” reaches about 3,200 per day, it will be cheaper to buy them condos in Gilroy, and until we reach 6,400 day, we should rather buy them mobile homes in Gilroy than give them Caltrain rides. Renting Caltrain riders apartments in Gilroy would be a less expensive strategy for larger numbers.
This may be welfare, but it sure is not sound, sustainable transportation.
Joe Thompson
Tres Pinos
Member, SBC Citizens Rail Advisory Committee; Legislation Committee, Transportation Lawyers Association; Association for Transportation Law, Logistics & Policy; candidate American Society of Transportation & Logistics
