Evaluating the Comps: The Transit Experience in Peer Markets

Evaluating the Comps

The transit experience in peer markets

• In St. Louis, opposition to LRT was fierce initially. But political will has swung decisively the other way since the debut of the first Metrolink line in 1993 and ridership that has exceeded expectations. St. Louis Metro is now extending its two existing lines and planning a third line, all without federal contribution.

• Pittsburgh’s streetcar system was the nation’s largest when it closed in the mid 1960s. Twenty years later the Allegheny County Port Authority began operating its modern light rail service, “the T”, which has grown to four lines. The Port Authority also operates three bus rapid transit lines.

• For overall transit, Houston, Dallas, Denver, Portland, Seattle and Cleveland are “peer markets” with Minneapolis. Metro Transit is more efficient than its peers in rides per dollar of subsidy (paying for 1/3 of bus operations out of the fare box) but provides fewer rides per capita than all.

• More: Start Tribune: "Transit on Trial"

Train Time: Mike Setzer on the Future of LRT

Train Time

Metro Transit’s outgoing general manager offers his view of light rail’s prospects

"There she is." Mike Setzer awaits an incoming train at the Lake Street LRT station, May 2004

June 2004—On a windy spring day Mike Setzer paced the platform of the Hiawatha LRT station at Lake Street, rattling off answers to questions about the new rail service. It was all in a day’s work to be asked these same questions over and again.

Of plans and specs and schedules he was a master, but as he walked he watched his feet. He carefully brushed his hand over the station’s computerized fare card machines, the steel benches and the glass partitions, all squarely bolted in place. 

A southbound Hiawatha line car arrives at the Lake Street station with downtown Minneapolis as the backdrop.

Metro Transit’s $715 million experiment was close to completion, but the physical reality seemed less familiar than the theory. As Setzer described the overhead heaters on the platform that would warm commuters in winter like so many cafeteria dishes, his look was introspective, as though he were reconciling what had long been in his mind’s eye with what he encountered now in three dimensions.

Then came the quick, chest-thumping blast of a train horn. 

“There she is,” Setzer said, his first unscripted line and perhaps his most convincing.

No matter who you are, it really means something big to see a slick new train easing into an elevated station with the Minneapolis skyline as the backdrop. 

With one blast of a horn, it becomes clear that Minneapolis was one kind of city before and another kind now. That’s what a train does.

Building market share
While the Hiawatha line may impress, will it do strong enough a business to survive? The Metropolitan Council has struck a determinedly cautious stance when it comes to the future of its LRT investment, which was made under the previous administration. With budgets tight and the usual clamoring for road projects now joined by a host of other transit ventures, Hiawatha will have to prove itself before its future, and the future of other planned light rail projects in the region, is at all clarified. 

Does the region truly have an appetite for light rail? 

The journeyman transit manager says unequivocally that LRT’s success will be driven by the meaningful supply of transit, not pre-conceived measures of demand.

Workers put the finishing touches in place a train heads out from the Lake Street station.

“We will fill all the seats we can provide,” he said. 

Setzer said the main factors in transit market share are commute time, scarcity of parking and all-weather dependability. As the metro area population continues to grow (the Metropolitan Council is planning for a doubling of the greater Twin Cities’s population by 2030), and as downtown redevelopment continues to replace surface lots with buildings, LRT should be able to capitalize on regional trends.

Among workaday commuters, especially in south Minneapolis and the southern suburbs, upcoming construction on I-35W and Lake Street will help build LRT Ridership.

Convenient airport service will be another big LRT draw, especially for convention traffic. Shannon McCarthy of the Greater Minneapolis Convention & Visitors Association said her organization has been priming the LRT pump for months. 

McCarthy said most Minneapolis tourists are from smaller towns and are often intimidated by the prospect of driving in the city core. Tourists account for 40 percent of Mall of America sales, and many of shoppers arrive by air from destinations around the country and the world. Having a rail link to the airport will increase the mega-mall’s appeal to upscale shoppers. Likewise, she said, marketing to conventioneers focuses both on the convenience of an added transit mode and the prestige conferred on cities that have rail transit. 

Setzer said Metro Transit is developing LRT promotional packages with the area’s major venues. These will roll out in the coming months.

LRT vs. other types of transit
Do local busway backers or even PRT advocates have anything to fear from light rail?

Setzer calls competition between transit modes a political condition rather than a reflection of system planning. He says multiple modes of transit geared toward specific needs provides the best service, as can be seen in other cities such as Portland, St. Louis, and Chicago.

“Single occupancy cars are the opposition, period,” he said.

And while Setzer said he expects light rail to prove itself and change the nature of local transportation planning, he predicted that the bus will remain transit’s workhorse for the next 50 years.

“Today the Metro Transit system is 900 buses and 24 rail cars. The proportions are not going to change radically any time soon.”

Mike Setzer: A Look Back, a Look Ahead

A Look Back, a Look Ahead

Mike Setzer, Metro Transit's outgoing general manager, sees "great potential" in public-private partnerships for community building around transit.

“I only wish I could package the broad understanding of transit's role
in the regional economy that I find in the Twin Cities, especially among private sector thought leaders . . . ”

Mike Setzer leaves Metro Transit with 2,600 employees, 132 bus routes delivering 67 million trips per year and, soon, one commuter rail line. He will, for the second time in 11 years, take over the SORTA Metro system, which in all respects is about a third as large. Here he reflects on his experience in Minneapolis and the task ahead. 

“There are monumental differences between the Cincinnati situation and the Twin Cities'. SORTA is essentially a city transit system whose funding structure requires that suburban service pay for itself. Cincinnati Metro thus is virtually unconnected to State government. No state appropriations, but then no state legislature to deal with either.

“My take from Metro Transit is that a success in transit needs to have two things, a dependable source of operating funds and a superb daily operation. Metro Transit puts the most courteous, professional group of operators on the street each day behind the wheel of one of the best fleets anywhere. It was that way when I got here—I take no credit for that. But nonetheless, ridership has fallen, service has been cut and fares have been increased. Now, about those appropriations . . . .

"Moving on, I am convinced that public-private partnerships have great potential. In Cincinnati, we are just beginning to look at some opportunities to partner. When a significant element of the transportation market understands its stake in the transit system's design and performance and wants to get actively involved, you can get some dynamic interplay that rises above routine. 

“For instance, in Cincinnati there is a sprawling suburb that now wants to grow into a real ‘place’ by developing a unifying identity, some community building amenities, and some logic in how people move into and within the township. Their first big investment? A transit center and park-ride facility. But it is also integrated into new retail investment as well as other public infrastructure investment.

“I only wish I could package the broad understanding of transit's role
in the regional economy that I find in the Twin Cities, especially among private sector thought leaders, and splice it into the public policy debate in Ohio. Maybe soon.”

Special Series "Happy Rails": LRT Debuts

On June 26, Hiawatha light rail will debut in the Twin Cities, and the man in charge of putting the line in place will take his curtain call. 

Mike Setzer at the Lake Street LRT station, May 2004. Setzer will leave Metro Transit soon after the debut of Hiawatha light rail.

June 2004—Mike Setzer, Metro Transit’s general manager since 2002, will head to Cincinnati to run the Southwest Ohio Regional Transit Authority, a position he previously held from 1987 to 1993. Setzer’s family has lived in Cincinnati during the years he has held his post with Metro Transit in Minneapolis.

"This is a very difficult decision," Setzer said in a statement announcing the move in May. "Metro Transit is the finest agency I have served in my 30 years in this profession. Nevertheless, my 13-year-old daughter and wife, Kathy, deserve a full-time dad and husband. This new position affords that opportunity."

On schedule, on budget

Managing the return of commuter rail to the Twin Cities after a 50-year hiatus will no doubt rank as Setzer’s signature achievement with Metro Transit. Hiawatha LRT will be delivered on budget at $715 million and, in terms of construction, on schedule. 

But Setzer’s tenure has been marked with other major events, including the 2004 bus operators’ strike. The 46-day walkout was the longest in a major city in 20 years, said Setzer. Metro Transit reports that it recovered 90 percent of lost ridership in the six weeks following the strike, though Setzer noted that a year might be needed to close the gap fully. 

In 2003, Setzer managed to close an $11.4 million state funding gap for the agency. He had to raise fares and implement a five-percent service cut, but the overall impacts were broadly thought to be minimal considering the size of the budget shortfall.

New services and innovation
Setzer’s administration created new and improved bus service for south Minneapolis, Bloomington, Edina and Richfield through a comprehensive community outreach process. 

And Setzer is being praised as a technological innovator, boosting the performance of Metro Transit’s 900-bus system by introducing rechargeable “smart cards” for fares, installing satellite tracking systems on buses, and experimenting with hybrid electric buses.

The Phillips Partnership would like to thank Mike Setzer for his work on sustainable development in the Twin Cities and in south Minneapolis in particular.

Midtown Exchange Fills New Housing Gap

Midtown Exchange to Fill New Housing Gap

Apartments, condos and townhomes will be marketed to a range of incomes

June 2004—For decades the Sears center at Chicago and Lake supplied household goods to the Minneapolis region. Now the site's redevelopment is relying on housing to support its mix of uses. Starting in 2006, the Midtown Exchange will offer approximately 350 units of new housing geared toward a range of incomes from 50-percent area median income (AMI) to market rate. 

These include rental apartments and for-sale condominiums within the original 1928 former Sears building as well as for-sale townhomes to be developed in a new building immediately to the east. 

Throughout the comeback of the Phillips neighborhoods, renovation has far outpaced new construction in housing. But as housing values continue to rise for the older stock of homes in Phillips West, Midtown Phillips and East Phillips, the market for new housing has opened, particularly for multi-unit developments catering to singles and small families. 

This development trend, begun in the Uptown neighborhood, has moved eastward along the Lake Street-Midtown Greenway corridor into Phillips.

Sherman Associates, Inc., an award-winning local developer that has been active in the Uptown boom, will put around 300 one- and two-bedroom units into the historic 1928 former Sears building. Eighty-eight of the units will be condominiums with an average sale price of $220,000.  The balance will rent for 50-percent AMI, 60-percent AMI and market rate.

Elizabeth Flannery, the project manager for Sherman Associates, said, "We believe the diversity of price points and will lead to enormous success because they reflect the diversity of the market. All will be modern, loft-like and located in the heart of an exciting urban area."

The location between Lake Street and the Midtown Greenway, Flannery said, is perhaps the strongest amenity. In addition, the proximity and access to transit, services, and employment will be major attractions.

Sherman Associates is currently marketing two other projects located adjacent to the Greenway at 29th and Bloomington and 29th and Bryant. One is affordable rental and one is high-end condominiums. Both are renting and selling at well above initial expectations, Flannery said. 

Across 10th Ave. from the 1928 building will rise a new, 1,425-stall parking ramp wrapped by for-sale townhomes. Project for Pride in Living, Inc., will develop the housing portion of the new structure, calling it "The Greenway at Midtown." Units will face 11th Avenue and the Midtown Greenway, softening the appearance of the six-level parking ramp.

Margaret Dondelinger of PPL says the average price of the one-and two-bedroom townhomes will be in the $185,000 range. As “workforce housing”, at least 25 percent of the units will be marketed to households with incomes at or below 80 percent of AMI. 

Although still in the market analysis phase, the concept plan calls for 21 two-story townhouses, with street access, and 32 one-level condominiums range in size from 800 to 1400 square feet. 

Median Housing Values in Phillips

Single Family Housing Values in Phillips

Median value shown

Anti-Crime Initiatives Lead to New Investments at Chicago-Lake

Building on Success: 

Anti-Crime Initiatives Lead to New Investments at Chicago-Lake

October 2003—"Chicago-Lake has long been an 'if only' intersection," said John Wolf, owner of Chicago-Lake Liquors. "People would say, 'With so much traffic, this would be a great location to invest if only the crime wasn't so bad. Now crime is down and we have the right conditions to make those investments." 

Wolf should know. A member of the Chicago-Lake Business Association, he became part the Chicago-Lake Crime Workgroup, one of most successful neighborhood-level anti-crime efforts in the city. And he is the investor behind one of two ongoing redevelopments of storefront businesses at Chicago-Lake that total more than $1 million. 

Wolf is backing the construction of a Mexican eatery, Carne Asada, to be operated by Ernesto Reyes, whose Me Gusta restaurants are among the best-known on East Lake Street. Across the street, on the intersection's northeast corner, Peter Boosalis is remodeling for a Foot Locker shoe store and other new retail tenants. 

"My family has owned this building since 1909," said Boosalis. "They were the first Greek immigrants in the city. So this corner is in my blood. It feels great to be expanding rather than waiting out the bad times, as we've had to do for many years. The corner is more stable, and that gave me the confidence to move ahead." 

These significant reinvestments come only a year after a neighborhood group approached the Phillips Partnership seeking leadership in addressing a particularly disturbing spike in crime. When the partnership formed the Chicago-Lake Crime Workgroup in March 2002, the crime rates were twice what they are today.   

Chicago-Lake Intervention

By building strategies to fight quality-of-life issues like corner drug dealing and litter, the Chicago-Lake Crime Workgroup created a model for targeted enforcement. The workgroup focused intensely on coordinating the efforts of several law-enforcement jurisdictions and neighborhood initiatives. The major results were constant patrolling, stepped-up parole monitoring and a near-daily schedule of street cleaning. 

"The corner is mostly calm. It's as clean as I've ever seen it," said Ted Muller, executive director of the Lake Street Council and a member of the Chicago-Lake Crime Workgroup. "We did a lot of good by making our presence felt." 

Ten months after its creation, the Chicago-Lake workgroup issued a final report in February that proposed the formation of a law-enforcement partnership that would apply the crime-reduction strategies of the Chicago-Lake intervention throughout the Lake Street corridor in Phillips. 

"We set up the crime workgroup and the crime rate fell," said Hennepin County Commissioner Peter McLaughlin. "Now we need to see this happen all along Lake." 

That mission has been entrusted to the Phillips Police Probation Partnership, or P4, a new alliance of enforcement officers from Minneapolis police, county probation and Metro Transit. The 11-member group also includes city and county attorneys and neighborhood representatives. The Phillips Partnership provides a staff member to convene and support the group. 

At P4's core is a probation-based strategy--considered the central accomplishment of the Chicago-Lake workgroup--that targets repeat offenders who return to a regular hangout after serving short jail sentences for misdemeanors. 

"We expect this new crime fighting partnership to continue with a sense of urgency," said McLaughlin. He said P4's initial operational focus is Lake Street between Chicago and Bloomington Avenues. 

Cooperation Finds Answers, Raises Questions 
When the intervention began, the Crime Workgroup's goal was to explore cooperative solutions for improving public safety at the intersection. 

First, the Minneapolis Police Department and Metro Transit Police aligned their schedules, ensuring the intersection would have continual patrolling from 2 pm to 2 am. This measure stayed in effect from April to October, 2002. 

The workgroup analyzed crime at the intersection and found that misdemeanors committed by repeat offenders already on probation accounted for the bulk of the activity. This finding became the central element in the workgroup's response. 

McLaughlin and Commissioner Mark Stenglein sponsored a resolution authorizing $5 million dollars for neighborhood-based enforcement. The county board then earmarked a portion of this funding for the addition of two probation officers stationed in the Phillips neighborhood. 

The workgroup tied stepped-up law enforcement to other methods of crime deterrence. One step was to coordinate a regular schedule for litter removal with the city, county, Metro Transit, Sentence to Serve and neighborhood volunteer groups, including the Chicago-Lake Business Association. Another was gaining a pledge by the Greater Minneapolis Council of Churches to visit all identified arrestees in the workhouse. 

And the workgroup raised awareness of the need for better reporting and analysis of crime statistics for misdemeanors. 

Police records show that "quality of life" crime accounts for approximately 60 arrests per month at the Chicago-Lake intersection. Roughly half of those arrested are on probation. The workgroup advocated for a better system of tracking misdemeanors that would be modeled on the Minneapolis Police Department's CODEFOR database, which has published violent crime statistics broken down by neighborhood since 1998. 

Budget Cuts Threaten Progress 
The handful of city and county law enforcement personnel whose informal coordination drives the P4 group have expressed guarded optimism that they can realize the workgroup's mandate.

"Any time you put resources together and form partnerships, you have success," said Minneapolis Police Lieutenant Kris Arneson of the Third Precinct. "With Chicago-Lake, community police and business came together and worked out what they wanted to see happen. It's the cooperation that brings lasting results. No one group can achieve them alone." 

At issue, said Arneson, isn't will power but budget. 

"We saw the value of six months of scheduled enforcement at Chicago-Lake. The problem is, overtime paid for those patrols, and authorizations for overtime are getting less and less frequent."

McLaughlin expressed concern to the workgroup at its final meeting that state budget cuts to public policing--$5 million in the 2003 budget--has created a struggle for resources that could forestall his efforts to move more probation monitoring into the community. He urged concerned people and organizations to write Governor Pawlenty to communicate the importance of special enforcement programs in targeted neighborhoods. 

The current cuts will "draw down" 12 probation officers in adult supervision, said Craig Vos of Hennepin County Probation, but they will not immediately affect staff in south Minneapolis. The likeliest impact, he said, would be felt at the level of city and county attorneys who make the inter-agency coordination possible. "If we're squeezed at the top, it's uncertain how well our efforts will translate into prosecutions." 

The Phillips Partnership has pledged continued support for the P4 in organizing community resources and issue advocacy.

Phillips Police Probation Partnership (P4) 
- Lt. Kris Arneson, Minneapolis Police
- Scott Christensen, City Attorney's office
- Sadie Facion, Hennepin County Probation
- Don Greeley, Minneapolis CCPSAFE Officer
- Karen Green, Minneapolis CCPSAFE Officer
- Denis Haven, Metro Transit
- Shirely Heyer, Midtown Phillips Neighborhood Association
- Julie Ingebretson, Ingebretson's
- Andy LeFevour, County Attorney's office
- Jana Metge, Midtown Phillips Neighborhood Association
- Michael Sandin, Hennepin County Probation
- Craig Vos, Hennepin County Probation (convenor) 
- Louis Smith, Phillips Partnership (staff) 

Chicago-Lake Crime Workgroup 
- Lt. Kris Arneson, Minneapolis Police
- Lee Cunningham, Messiah Lutheran Church
- Sadie Facion, Hennepin County Probation
- Bob Hand, Minnesota Workforce Manager
- Dennis Haven, Metro Transit Police
- Pete Huber, Abbott Northwestern Hospital
- Andrea Jenkins, Council Member Robert Lilligren's Office
- Joyce Krook, Abbott Northwestern Hospital
- Sharon Lubinski, Minneapolis Police
- Gwen McMahon, Citizen
- Jana Metge, Citizen
- Nicole Magnan, Minneapolis Police, CCP Safe
- Ted Muller, Lake Street Council
- Jack Nelson, Metro Transit Police
- Ken Palmer, Wells Fargo
- Michael Sandin, Hennepin County Probation
- Eric Shogren, Minneapolis Police
- Muriel Simmons, Phillips West neighborhood
- Lisa Vecoli, Hennepin County Commissioner McLaughlin's office
- Craig Vos, Hennepin County Probation
- John Wolf, Chicago Lake Liquors

September 2003 Newsletter

September 2003 Phillips Partnership Newsletter

Patrolling Chicago-Lake

Phillips Up Close: Patrolling Chicago-Lake 

March 2003—The day’s first call came in ten minutes after Patrolman Lucas Peterson reached his Chicago-Lake beat at 11:15 am: report of a man breaking into a panel truck. Peterson hit the siren and cut his way through traffic, crossing into the residential streets south of Lake. 

Two workmen were waiting for him on the sidewalk by the truck. From inside it came the banging and cursing of an agitated man trying to get out. 

The workmen said they’d been making repairs in a nearby house. Looking down on the curb from the window one of them saw a man climbing into the truck. They ran down from the second story and pulled down the back door, trapping the man as he foraged through their equipment. They’d also been robbed the night before, they said, a thousand dollars worth of equipment stolen.

Peterson and another officer who answered the call opened the door and found the man gagging in a cloud of spray from the fire extinguisher he’d been using as a battering ram. The officers hauled him out and arrested him, confiscating a small knife and a large bottle of schnapps. 

“I see this individual all the time,” said Peterson after the arrest as he cleaned his hands with an alcohol wipe. “A guy with a hard life who goes around making life hard for other people.”

Peterson has been on the force for nearly three of his 23 years. He has the frame of a high-school linebacker. With his crew-cut blonde hair and fair skin, he looks a bit like the rapper Eminem and said the resemblance has been noted on the streets. He has worked the day shift at Chicago-Lake since January. He thought the beat assignment was a good break from answering 911 calls on the 7 pm to 3 am “dog shift.”

The day unfolded much the same as it began. Traffic stops, a car accident, on and on. 

Most of the shift he spent rolling slowly up and down the streets, eyeing the gang members hanging out or walking by. “I give them a look, they give me a look,” Peterson said. “It’s a game we play every day.”

Yet Peterson well understands that his regular presence often must do the bulk of the work in discouraging crime. He said he and his partner made 63 arrests this January, but only between one-in-six and one-in-eight of them resulted in a prosecution. The felonies get the attention. The misdemeanors get dismissed.

“With PC (probable cause) arrests, we can hold them 48 hours. Most of these gang bangers see that as a shower, a night’s sleep and free meals. You can’t threaten them with arrest. On the street that just has no value because they know they’ll be back on the same corner in a couple days.”

Peterson knows little about the Phillips Partnership, the Chicago-Lake Crime Workgroup or the Phillips Police Probation Partnership. He said he wishes he could make better connections with the business owners and residents on his beat.

“I think outreach is great, but the way it goes out here, I stay very busy dealing with the so-called criminal community.”

December 2002 Newsletter

December 2002 Phillips Partnership Newsletter