NCPA - National Center for Policy Analysis


December 27, 2006

Flush with oil and gas revenues, New Mexico has joined the nationwide rush to embrace expensive rail projects, with little regard for cost and even less consideration for utility, says Paul Gessing, president of the Rio Grande Foundation.

Among the boondoggles:

  • A "Rail Runner" commuter train system connecting Albuquerque and Santa Fe with two towns with only 7,000 people each, estimated to cost more than $500 million, and 90 percent funded by taxpayer subsidies.
  • A "modern streetcar" system in Albuquerque that will cost at least $28 million per mile, but serves a population of less than 2,500 people per square mile. 

New Mexico's infatuation with costly rail projects will continue to burden the state's economy with wasteful spending into the distant future.  The reality was made clear earlier this year when $1.5 billion in federal money was secured for Washington's Metro rail system, contingent on local governments raising taxes on their citizens to create a "dedicated revenue source" for that system.

While New Mexico's Rail Runner and streetcar systems will be nowhere near the size and cost of DC's Metro, the federal government is not going to bail the state out, says Gessing.  In other words, big tax hikes will be necessary to pay for operating costs, upkeep, inevitable expansion and cost overruns. 

Source: Paul Gessing, "Richardson Railroads Taxpayers," Rio Grande Foundation, December 4, 2006.


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