U.S. Transportation Secretary Ray LaHood on Monday formally awarded Charlotte $25 million for its starter streetcar line, and said in a campaign-style speech that congressional passage of President Barack Obama's American Jobs Act would lead to similar projects and jobs.

The city plans to build a 1.5-mile streetcar line from Time Warner Cable Arena to Presbyterian Hospital. The city's goal is to extend it to create a 10-mile line from Beatties Ford Road to the site of the old Eastland Mall. It doesn't yet have a way to pay for it.

Construction will begin in December 2012, after the Democratic National Convention. The city hopes to begin service in 2015.

The line is expected to cost $37 million, with the city paying $12 million. The city hasn't said how it will pay for an estimated $1.5 million in operating costs.

The $25 million grant from the Federal Transit Administration wasn't a surprise; it was announced in spring 2010.

But with Obama urging Congress to pass his jobs plan, LaHood held a press conference at Central Piedmont Community College, located on the streetcar line.

"This rail line will become an economic engine," LaHood said.

LaHood said Obama's jobs proposal would fund additional highway and transit projects, and said there would be an additional $4 billion for high-speed rail.

The city said it estimates the streetcar will produce 385 jobs, using an FTA formula.

The N.C. Republican Party said Monday that President Obama "has been wrong all along."

"The rhetoric doesn't match the reality," said Rob Lockwood of the N.C. Republican Party. "If these programs worked as magically as they said would, we wouldn't have 9.1 percent unemployment."

The streetcar line has been controversial.

It will replace a Gold Rush shuttle line, and won't go any faster than a bus, unlike the 4-year-old Lynx Blue Line light-rail project.

Streetcar supporters say it will produce economic development, as businesses will want to locate along the rail line.