Are Street Cars a Good Use of Transit Dollars? A Look at The Hop After One Year in Milwaukee

Desire for development drives Milwaukee’s year-old streetcars.

Illustration by Daniel Downey
On a sunny July weekend, The Hop was the hottest thing in town. Standing-room-only crowds filled Milwaukee’s streetcars and packed the Cathedral Square platform on their way to and from Bastille Days. Almost 9,000 people rode The Hop that Saturday, more than four times the average daily ridership of the first seven months of this year. Mayor Tom Barrett, who proposed the streetcar and pushed it through to completion, trumpeted the new high. After decades of debate, it seemed as if Milwaukee finally had a modern rail transit system.

And yet, as The Hop nears its first anniversary Nov. 2, questions remain whether streetcars – here and nationwide – are a good use of transit dollars, particularly as the city plans to keep fares free in year two. That critique isn’t coming only from the usual suspects in the no-rail, no-way, no-how crowd, but from transit advocates and scholars who contend light rail and buses better serve commuters and others who rely on public transportation. By contrast, conservatives attack the cost and inflexible routes of both light rail and streetcars.

Joel Rast, director of UW-Milwaukee’s Center for Economic Development, calls light rail “a clearly superior way to get to different parts of the city.” He questions the wisdom of spending transit money on a system that mainly serves tourists and Downtown employees instead of helping urban workers without cars reach suburban jobs, an issue he has studied extensively.

Why, then, have Milwaukee, Kenosha and 30 other U.S. cities built streetcar lines, with almost half opening in the last 10 years and more planned? It’s because supporters see streetcars not just as transit vehicles but as economic development engines, attracting new construction, tourists and conventioneers by making it easier to get around their downtowns.

Streetcars often are “more oriented around spurring growth” than serving commuters, says Chris McCahill, deputy director of the State Smart Transportation Initiative at UW-Madison. Like other transportation infrastructure, streetcars don’t directly cause development, but support it by improving access, says Kevin Muhs, executive director of the Southeastern Wisconsin Regional Planning Commission. And the rails that conservatives deride for their inflexibility assure developers that access won’t evaporate as easily as a bus could be rerouted, supporters say.

Financing for The Hop reflects its purpose. Milwaukee is the only city paying the local share of streetcar construction ($59 million of the initial $128.1 million) entirely through tax-incremental financing districts designed to aid development, a Wisconsin Policy Forum study found. However, state law rules out most revenue sources used elsewhere, the study added, and GOP lawmakers have even restricted TIF use for the streetcar.

The Hop’s development ties also show in its planned lakefront hub at the much-delayed Couture building and in an expansion debate in which the key words have been neighborhood growth and gentrification.

If development is the mission, is The Hop accomplishing it? Supporters say it’s too early to tell. City officials report above-average property value growth on the route but can’t say how much is from The Hop and how much is from a booming Downtown. City development staffer Dan Casanova points to new buildings on a previously stagnant stretch of Broadway, where developers have called the streetcar a factor.

Barrett remains optimistic. “I’ve always promoted economic development as a big part of this,” he says. “There’s no question [the benefits] are tangible and long term.”

Fast Lane

THE HOP ISN’T Milwaukee’s only public transit innovation. Milwaukee County officials are planning a $53.4 million bus rapid transit line that could share transfer points with the streetcar.

Bus rapid transit (BRT) is designed to mimic light rail, with buses in dedicated lanes, stoplights that favor them and train-like platforms where passengers pay in advance. The 9-mile line would run from the lakefront to the Milwaukee Regional Medical Center in Wauwatosa.

Milwaukee and Wauwatosa officials will allow dedicated lanes on only half the route. But Milwaukee County Transit System spokesman Matt Sliker, the Southeastern Wisconsin Regional Planning Commission’s Kevin Muhs and the Wisconsin Policy Forum’s Rob Henken say the BRT line still would be effective.

If federal and local officials approve, the BRT line would start in 2021. Riders could transfer to the The Hop at the proposed Vel Phillips Plaza by the Wisconsin Center and at the planned Couture on the lakefront, city Public Works Commissioner Jeff Polenske says.

Different Tracks: Streetcars vs. Light Rail

“LIGHT RAIL LIGHT” was the way then-County Executive Scott Walker and other critics dismissed Milwaukee’s streetcar when Mayor Tom Barrett proposed it in 2007.

That term summed up how much nuance was drowned out – or tuned out – in the monotony of the lengthy ideological battle. Because neither side’s arguments changed much as discussion turned from light rail to modern streetcars, which look like light rail vehicles, many people may not see a difference.

Yet understanding that difference could be the key to understanding The Hop’s first year and its future. Comparing The Hop and its streetcar siblings with their urban rail transit cousins, the nation’s 23 light rail systems (as in Minneapolis) and 14 heavy-rail subway and elevated train networks (as in Chicago), illustrates how streetcars are treated more as economic tools than as public transit.

Where They Go: 

Every urban rail transit system connects a city’s downtown with outlying neighborhoods. They usually run on rails separate from street traffic, and many reach airports and close-in suburbs. By contrast, most streetcars stay downtown and in nearby neighborhoods. No streetcars serve airports.

The Hop’s 2.1-mile starter line runs from the Milwaukee Intermodal Station to Downtown’s northeastern corner, with a 0.4-mile second line under construction to the lakefront. Proposed extensions would bring it to the Wisconsin Center and then Fiserv Forum, Bronzeville and Walker’s Point.

As long as they operate in traffic, streetcars work best for relatively short trips, says Kevin Muhs of the Southeastern Wisconsin Regional Planning Commission. They’re not fast enough or long enough to accommodate the demands of airport runs, he says.

Who Rides Them: 

Commuters use light rail and heavy rail lines, as do students, visitors and others. People who live near downtown might commute on streetcars. But in about a dozen cities, including Kenosha, streetcar schedules skip morning rush hours, bypassing commuters to target tourists and residents visiting local attractions.

The Hop is among 20 streetcar lines with frequent, all-day, year-round service. Of the nine newest streetcar lines with comparable service and vehicles, The Hop’s average daily ridership of 2,061 for the first seven months of this year is roughly in the middle.

Who Runs Them: 

Every urban rail transit system is operated by a transportation agency, usually the same one that runs local buses. But bus authorities operate only about half of streetcar systems, including Kenosha’s 19-year-old line. Cities and nonprofit groups run the rest.

In Milwaukee, the city owns The Hop and contracts with French-owned Transdev to run it. The Milwaukee County Transit System lost a late bid to operate the line but is in talks to add real-time tracking of The Hop to its app and website, say Public Works Commissioner Jeff Polenske and bus system spokesman Matt Sliker.

Who Pays For Them: 

Federal, state and local taxes, supplemented by fares, pay for running urban rail transit systems. Some streetcars are financed the same way, but business sponsorships and advertising often underwrite operations.

A federal grant and a Potawatomi Bingo Casino sponsorship pay most of The Hop’s $4.4 million annual operating cost. Riding The Hop has been free for its first year, and city officials surprised the Common Council by scrapping plans to start charging fares in November. Polenske says the idea is to give people more time to try The Hop and see its value.

At least seven other streetcar systems are free, and at least six others saw ridership drop when fares started. Still, riders value convenience and safety over cost, says Chris McCahill of UW-Madison’s State Smart Transportation Initiative: “Even if they’re free, people won’t use them if they aren’t serving a need.”

“A Hopping Downtown” appears in the November 2019 issue of Milwaukee Magazine.

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Larry Sandler has been writing about Milwaukee-area news for more than 30 years. He covered City Hall and transportation for the Milwaukee Journal Sentinel, after reporting on county government, business and education for the former Milwaukee Sentinel. At the Journal Sentinel, he won a Milwaukee Press Club award for his investigation of airline security. He's been freelancing since late 2012, with a focus on local government, politics and transportation. His contributions to Milwaukee Magazine have included in-depth articles about our lively local politics, prized cultural assets and evolving transportation options. Larry grew up in Chicago and now lives in Glendale.