Overview

The streetcar project will be a major undertaking for Huntington. It may well be as significant to the Southern West Virginia region - in terms of tourism, and the ability to absorb additional visitors - as the new Regional airport, US 52 four lane completion, and other transportation venues come on line. Because of this far-reaching influence, it is important to consider not only traditional sources of funding for transit capital projects, but also creative and innovative resources and partnerships.

This section of the site does not give a definitive funding program. Rather, it provides an overview of funding sources which have been used on other similar projects, and suggests some possible sources which may be available to Huntington. The purpose is twofold:

• First, to allow HETA to begin the dialogue with community leaders in both the public and private sectors to assess the viability of various funding options as component parts of overall project funding, and
• To start the creative "juices" flowing so that other possibilities may be forthcoming.

Capital Funding Sources

Federal

The primary source of capital funding for the Huntington streetcar system will be Federal dollars, most of which will come from the recently-enacted Transportation Equity Act for the 21st Century (TEA-21). There are two significant sections of this legislation which may be used. The "new starts" section of the previous legislation has provided funds for several projects. For example, the Congress appropriated $1,988,046 for fiscal 1997 to help the Little Rock River Rail project get underway. Additional appropriations were made for fiscal year 1998, and are expected to be approved for 1999 and subsequent years to help fund this project. A rough rule is that 80% of the capital cost may be provided through this source.

Within the provisions of the TEA 21 legislation is a second Federal source of capital funding - the Congestion and Air Quality Improvement Program (CMAQ). Since 1992, this program has provided almost $2 billion nationally for public transit purposes, including assistance on vintage trolley projects.

While TEA 21 is in large measure a continuance of the former transportation funding legislation, it does have several new features. Specific guidelines for the use of program funds are currently being finalized, and should be obtained by HETA as they become available. In the meantime, it is important to work with the West Virginia Congressional Delegation and with the Federal Transit Administration to assure that the Huntington project is properly presented in accordance with these guidelines.

A town somewhat similar to Huntington is Harper's Ferry, West Virginia, where a Civil War vintage community's downtown is preserved, and is accessible to visitors only by a shuttle bus. This bus service and the remote parking lot is operated by the Parks Service. Although Huntington is not a National Park venue, it is a Historic District. This suggests that the applicability of both Federal preservation and tourism funding should be explored.

State and Local Public Funds

Most Federal transportation funding flows through the West Virginia State Highway and Transportation Department. Thus, it is important that this agency be closely involved in funding discussions. Several elements of the Huntington streetcar project may fall within the eligibility parameters of State funding for transportation. It is beyond the scope of this report to provide a detailed review of all of the State transportation funding assistance programs, but this review should be undertaken as the project moves forward.

The Huntington streetcar project enhances tourism and assists historic preservation. Thus it is appropriate that State programs for assistance in these areas be explored also.

Local capital funding assistance may take several forms. A fairly common one is to allow in-kind services or donations to be used for Federal match. HETA and the Huntington City Council should jointly explore these possibilities.

Several systems have enlisted to participation of the private sector for funding assistance in vintage trolley projects. In both Memphis and San Jose, private contributions have provided funding for vehicles. There are also many examples around the country where the private sector has provided funding for passenger stop amenities.

Finally, local funding can be provided through various fees and taxes. Some examples from other cities include:

• An increase in sales tax.
• Lodging tax.
• Parking fees.
• Creation of special Business Improvement Districts which allow for raising revenues through tax increment assessments within the District.

The determination of the exact mix of capital funding sources for the project will require considerable cooperative discussions within the community. The most likely scenario will be a combination of several mechanisms.

Operating Funding Sources

As shown in the Operating Costs portion of this site, the operating cost of the system can be substantially recovered through the farebox. However, since the possibility of an operating deficit exists, a discussion of non-farebox operating funding sources is included in this section.

Other non-traditional local sources may be available, if needed. Interior and exterior advertising space is provided on the streetcars, and this could be sold. Similarly, provisions for advertisements could be made at certain passenger stops. On certain weekends, where special events are undertaken by the community, the cost of running special service can be partially offset by event sponsors. In Galveston, for example, a local department store agreed to underwrite the operating deficit for the initial period of operation. Some transit systems have had the cost of service reimbursed by a local retail establishment or consortium of businesses for a day, in return for recognition.

One idea harking back to the days of the Citizens Electric Railway is the "party car", described in the Historical Precedent area of the site. Such a vehicle could be chartered by individuals, or hoteliers for their guests.

If an interpretive museum is developed as part of the maintenance facility, a gift shop can be included, where postcards and perhaps a small history book of the Huntington streetcar can be made available.

Other cost-sharing ideas are also feasible. These include volunteers for such tasks as staffing the gift shop, maintaining passenger stops, or cleaning the cars. Administrative functions such as payroll and accounting can be undertaken by the City, the TTA, or another body. Marketing and advertising expenses could be partially undertaken by others. Indeed, the promotion efforts currently in place to attract visitors to Huntington will undoubtedly prominently feature the streetcar!

The specific non-farebox contributions required will be determined after the actual operating plan has been further developed. This will be done as part of the next phase, and will be subject to refinement as actual service experience dictates.