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Denver FasTracks system to cost $6.7 billion

Massive transit expansion project could be completed by 2017.


The Denver RTD (Regional Transportation District) now says it will cost $6.7 billion to build all of FasTracks, but without a doubling of the existing tax this year, the agency will be short about $2.5 billion in revenues needed to complete the massive transit expansion by 2017.

Details of the 2010 FasTracks financial plan, released by Regional Transportation District officials today, show the agency expects cost savings for the project of about $300 million, compared with last year's cost forecast of $7 billion.

But RTD also is using a lower forecast for sales-tax collections, which are a key component of the revenue stream that will pay for FasTracks, the nation's most ambitious mass-transit expansion program.

The agency now is forecasting that it will have about $4.2 billion available from tax collections, federal funds and other sources to build the project by 2017 unless metro Denver voters approve a doubling of the existing 0.4 percent FasTracks sales tax in November.

Last year's revenue forecast was $4.8 billion.

Passing the tax increase this year would produce enough additional revenue to construct the entire project by 2017, and operate and maintain the expanded transit system in the coming decades, said Tim Romer, a Goldman, Sachs & Co. investment banker who is RTD's financial advisor on FasTracks.

The full project includes six new train lines, extensions to three existing light-rail lines and other transit elements.

In a briefing this afternoon, Romer and RTD General Manager Phil Washington said RTD's new lower sales and use tax forecast means the agency now expects to collect only a little more than half the tax revenues projected when the original 0.4 percent FasTracks tax was presented to voters in 2004.

Six years ago, RTD predicted it would collect $13.7 billion in sales and use taxes through 2035; now, the agency estimates tax collections will total $7.8 billion over that same multi-decade period.

The anticipated tax revenues dropped $1.3 billion from last year's forecast of $9.1 billion, officials said.

"We're fully committed to completing the entire investment," Washington said of the FasTracks project.

RTD's board of directors is expected to decide in March or April whether to ask voters this year to hike the FasTracks sales tax.

The agency's advisors have suggested that 2012 might be a better year to go to voters, but Washington said delaying the vote -- and thereby delaying the FasTracks construction schedule -- would likely add at least $200 million to the project's cost.

Washington presented other potential scenarios for FasTracks, including:

* If voters approve the additional 0.4 percent sales tax this year, but RTD does not get a hoped-for $1 billion from the federal government to construct the train to DIA and the Gold Line to Arvada/Wheat Ridge, then buildout of the full FasTracks program would stretch until 2025.

* If RTD waits until 2012 to take a tax hike to voters, and they approve the increase, then the entire project can be completed by 2019, assuming receipt of the $1 billion in federal funds

Source: The Denver Post

 

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