VTA Connections

Study projects significant economic benefits associated with BART Extension

Dear Friends of VTA:

Over the years, there has been much discussion about how the BART extension to Silicon Valley will benefit our county, in terms of reducing congestion, creating a connected rail system around the bay, and increasing accessibility to neighboring counties for work and recreational activities.  Two weeks ago, a comprehensive study of the short and long-term economic benefits associated with this project was presented to VTA’s Technical and Policy Advisory Committees; this report quantifies many of the benefits that have been discussed. 

This Economic Impact Analysis of the BART extension project was initiated by VTA to satisfy one of the evaluation criteria in the federal New Starts Program. VTA retained Wilbur Smith Associates, one of few consultants in the country familiar with the FTA criteria, to conduct the analysis, which included a Return on Investment (ROI) analysis.

Highlights from the Economic Impact Analysis of the BART extension project, based on the first 15 years of BART operations include:

• Jobs: It is estimated that an average of 2,300 annual temporary jobs will be created, associated with construction of the project, and up to 2,400-7,400 permanent jobs to be created annually as a result of the project.

• Affordable Mobility: Better access to higher paying jobs for targeted public transportation users in Santa Clara County would result in up to $500 million additional income annually.  Approximately 68% of this additional income is expected to be spent within Santa Clara County on retail items, thereby increasing the tax base.

• Return on Investment: For every dollar spent on the project approximately $4-$10 would be returned to the study region over the extension’s initial 50 years.

• Highway User Benefits: Reduced highway traffic would save $3 billion in Santa Clara County and $6 billion in the study region.

• Vehicle Hours Traveled: In 2030, the daily Vehicle Hours Traveled would be reduced by 166,000 hours for Santa Clara County.

• Vehicle Miles Traveled: In 2030, the daily Vehicle Miles Traveled would be reduced by 587,000 miles for Santa Clara County.

• Sensitivity tests were conducted to gauge the impacts to benefits and savings that would occur based on changes in input assumptions, resulting in a range in benefits.  As an example, the low range of Highway User Benefits included a two-hour morning peak commute period and auto fuel prices ranging from $2.34 to $3.88 between 2005 and 2030, based on the 2005 average market fuel price for California. The high range of Highway User Benefits tested a three and four-hour morning peak commute period, and utilized updated fuel prices from the Metropolitan Transportation Commission of $2.73 to $6.28 during the study period.

The Economic Impact Analysis Executive Summary and Return on Investment Technical memorandum are available at:

http://www.vta.org/bart/documents/reports/bart_eco_efcts_eval_exec_sum.pdf

and

http://www.vta.org/bart/documents/reports/rtrn_on_invstmt_of_svrt_bart__ext.pdf

There is a lot of very useful information in this report and I hope that you will feel free to share it with friends and colleagues who may have questions about the BART extension project.  Clearly, a project of this size is a major investment in the Bay Area, and this report provides an overview of the many economic benefits that will continue to accrue to the county, not just in the short term, but, for many years to come. The projected return on investment, even on the lowest end, demonstrates that the investment made by county residents to build the BART extension project will pay for itself several times over the life of the project.

Michael T. Burns

General Manager

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About VTA
Santa Clara Valley Transportation Authority (VTA) is an independent special district responsible for bus, light rail and paratransit operations; congestion management; specific highway improvement projects; and countywide transportation planning. As such, VTA is both an accessible transit provider and multi-modal transportation planning organization involved with transit, highways and roadways, bikeways and pedestrian facilities.