Charlotte’s streetcar cost rises by $24 million

The cost of Charlotte’s proposed streetcar extension has risen from $126 million to $150 million and could go even higher if the city chooses to purchase trolleys that can partially run on batteries.

The city is also mulling whether to create a new taxing district along the route to help pay for operating costs. Property owners along the line could be required to pay more in property taxes, according to a city memo.

The owner of a property worth $500,000 would pay an extra $100 a year to support the streetcar, according to city estimates.

The City Council is scheduled to vote on Monday on formally applying for a grant with the U.S. Department of Transportation for half of the project’s costs. The 2.5-mile extension would expand the starter streetcar line that’s under construction from Time Warner Cable Arena to Novant Health Presbyterian Medical Center. The extension would run to Johnson C. Smith University to the west and to Sunnyside Avenue and Hawthorne Lane in the Elizabeth neighborhood in the east.

The streetcar is one of the city’s most controversial projects, and council members narrowly approved advancing it in May 2013.

City Manager Ron Carlee created a plan in which the city’s local match – then expected to be $63 million – wouldn’t rely on sources of city money that are funded with property taxes. At the time, not using property taxes was a sticking point for then-council member Patrick Cannon, who has since resigned and pleaded guilty to federal corruption charges.

The city now has to come up with an additional $12 million. Carlee’s plan to get the extra money would not use property taxes.

Much of the extra cost – $15.3 million – is due to inflation. The city also says it would have to replace the Hawthorne Lane bridge over Independence Boulevard at a cost of $6.8 million and spend an additional $1.9 million on miscellaneous items, such as paving.

The streetcar line under construction will use replica trolleys that were used in the late 1990s on the city’s South End streetcar line, which was replaced by the Lynx Blue Line. Those cars are powered by overhead wires.

If the second phase of the streetcar is built, the city plans to replace those replica trolleys with new modern streetcars.

Charlotte has researched whether it could buy hybrid streetcars that run on electricity and also batteries. That would mean the city wouldn’t have to build overhead wires at the intersection of Trade Street and Tryon Street, which some have said would be ugly.

The city said hybrid streetcars cost an additional $500,000 per vehicle.

The starter streetcar line is scheduled to open early next year. The extension would open in 2017.

The city estimates the first two phases of the streetcar will cost $6.2 million each year to operate.

Some of that money could be collected from fare revenue of at least $2.20 per trip ($1.5 million); creating a new taxing district along the line ($1.2 million); using motor vehicle license fee revenue ($3.2 million); and selling naming rights and advertising ($293,000).