Joseph Miller
The implementation of the proposed Loop Trolley, to run from the Missouri History Museum to the historic Delmar Loop neighborhood, has encountered frequent delays in recent years due to design finalization and legal concerns. Now it can add cost overruns to its list of problems. Bids to build the trolley have come in $11 million over the original $43 million cost estimate. That’s almost a 26 percent cost overrun before construction has even started. While trolley planners hope that lower estimates will come in later this month, if they do not, the trolley backers will have to alter their plans or find new revenue sources.

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Current funding sources for the Loop Trolley are multifarious, including a 1 percent sales tax in the Loop Transportation Development District (TDD), tax credits, congestion relief funds (despite the possibility that traffic may get significantly worse due to the trolley), MoDOT, Great Rivers Greenway (funded by sales taxes), and private money. By far the most important contributor is the federal government, which granted the project $25 million.

While sources are diverse, they tend to be both rigid and highly contingent, with little room to generate an extra $11 million. The federal government already is unhappy with the progress of the trolley and, far from considering further subsidies, has previously threatened to remove the grant. Tax credits and TIF revenue only go so far, and private donations, congestion relief funds, and state aid were never guaranteed in the first place, when less was required. The oft-mentioned 1 percent sales tax in the TDD is supposed to fund the operation of the trolley, not its construction.

If the Loop Trolley comes in $11 million over budget, existing funding mechanisms (which could only maybe cover $43 million) would be overwhelmed. But Loop Trolley planners remain confident. We can only hope that confidence is based on cost-cutting measures or private support, not more public subsidies.

About the Author

Joseph Miller
Joseph Miller was a policy analyst at the Show-Me Institute. He focused on infrastructure, transportation, and municipal issues. He grew up in Itasca, Ill., and earned an undergraduate degree from Georgetown University’s School of Foreign Service and a master’s degree from the University of California-San Diego’s School of International Relations and Pacific Studies.