In a recent essay for the Missouri Independent, I responded to an op-ed in The Kansas City Star by former Kansas City Mayor Sly James. In the piece, he extolled the streetcar for helping the city grow, and claimed the streetcar is an opportunity to bring the city together.
The mayor’s piece was mostly fluff—and several assertions he made were flatly wrong. One of them involved the success of the streetcar to drive the city’s economic growth, using sales tax receipts as evidence.
I first learned of this claim after I authored a piece in the Star in July 2024. In that column—and here on the Show-Me Institute website—I used property tax assessment data provided by Jackson County. From 2014 through 2023, the total value of the streetcar transportation development district (TDD), which runs along the entire route of the streetcar, grew at the same rate as the county as a whole. If the streetcar were truly a driver of economic development, one would expect to see the values in the TDD rise faster.
The streetcar authority, in a May 6, 2019, press release, does provide evidence of increases in total market value within the TDD, but it doesn’t go the extra—and necessary—step of comparing it to the county. Such growth may seem impressive, until you realize it was happening in places nowhere near the streetcar.
Even if the streetcar TDD property values had risen faster than property values elsewhere, it’s possible that the cause was something other than the streetcar. It could have been due to the number of other development subsidies handed out along the route. But the data show us that there is no growth, regardless of the reason.
After the piece was published, streetcar supporters alluded to the growth in sales tax receipts within the TDD, but did not share any information to back up this claim. James refers to this too in his recent piece, writing: “Sales tax receipts generated within the Transportation Development District surged by more than 65% following the line’s opening — far outpacing citywide growth.”
It appears that the source of these data is a 2019 article in Metro magazine in which the head of the KC Streetcar Authority, Tom Gerend, writes:
Sales taxes within the streetcar’s downtown Transportation Development District, a revenue-generation mechanism, have increased by 65% compared with approximately 16% growth citywide over the same period. Downtown is growing at a faster rate than the city as a whole and proving to be a strong economic engine.
That claim is from a press release dated September 14, 2016, on the streetcar authority’s own website. It reports that sales tax receipts grew by 58% from 2014 through 2016, versus 16% citywide. That May 6, 2019, press release repeats the sales tax increase claim, except at 60%.
Let us assume some version of these numbers is true. The TDD is a small district, and it is entirely plausible that even two or three downtown venues saw a big growth in their sales tax receipts. That may account for such impressive growth in a small district that wouldn’t cause much of a ripple citywide. What it doesn’t tell us is whether that sales tax growth was throughout the TDD, or whether it was due to the streetcar. That’s clearly what streetcar supporters want readers to believe. They may believe it themselves.
It reminds me of what former Show-Me Institute researcher Joe Miller uncovered in June 2016: even the Federal Transit Administration pointed out that “Almost all [civic] representatives interviewed believed that streetcars positively affected the built environment, particularly in attracting new development. . . . Few, if any, streetcar system operators seek information on their impact on economic activity, although most interviewed consider economic-related questions to be vital and desire further research on this topic.”
That’s damning.
Streetcar operators believe it; they just can’t prove it. Apparently they don’t even try.
Kansas City is considering expanding the streetcar system. We will likely hear all these economic benefit claims again. But until we see meaningful data, the claims can’t be taken seriously.
