In a gathering that was part tutorial, strategy session and pep rally, business leaders and local officials from Montgomery and Prince George’s counties crowded into a small auditorium at the University of Maryland in College Park on Wednesday for a hurriedly organized meeting designed to gin up lobbying efforts on behalf of the proposed light rail Purple Line.
Montgomery County Executive Ike Leggett and Prince George’s County Executive Rushern Baker and their staffs pulled the event together over the past week, in the wake of new Gov. Larry Hogan’s recent announcement that his administration would conduct a “thorough review” of both the $2.45 billion Purple Line—which would run for 16 miles from Bethesda to New Carrollton in Prince George’s County—as well as the proposed light rail Red Line through downtown Baltimore.
The session took place just hours before the Republican governor’s first “State of the State” address, during which Hogan – while proposing additional funding for road improvements — made no mention of the Purple Line. Hogan did propose repeal of automatic gas tax increases passed in 2013 that were aimed in large part at financing mass transit projects such as the Purple Line and Red Line. Meanwhile, at the College Park gathering, there were both public and private concerns expressed about process by which the new administration’s review of the Purple Line and Red Line would be conducted.
The Baltimore business community has been extremely active in pushing for the $2.9 billion Red Line in a campaign that has included newspaper ads, and Wednesday’s session was organized with goal of eliciting a similar effort from Washington, D.C., area business leaders on behalf of the Purple Line. James Dinegar, president of the Greater Washington Board of Trade, served as an informal master of ceremonies, noting his group’s strong support for construction of the recently opened Silver Line in Northern Virginia’s Tysons Corner area. Characterizing the Purple Line as “the Silver Line for Maryland,” Dinegar declared, “I think it’s time that we start to put more and more of the spotlight on that…This is an economic engine way beyond what we’ve heard about in the past.”
As Leggett and Baker—along with Montgomery County Council President George Leventhal and Prince George’s County Council President Mel Franklin—appeared before the assembled business leaders, they were joined by University of Maryland President Wallace Loh, who vowed to press Hogan to move ahead with the Purple Line.
“This will be transformative for the future of the University of Maryland,” Loh declared. Five of the planned 21 stops on the Purple Line will be located in or near the campus.
“If we want the flagship university [in College Park] to ascend in the ranks of the great public universities of this country, to attract the best faculty and the best students, to continue doing the research that spawns jobs, we need the Purple Line," said Loh, who assumed his post four years ago and has taken a stance in contrast to that of his predecessor, C.D. Mote, who did not support the project.
Leggett—while urging the local business community to lobby on behalf of the project—also sought to turn up the heat on Hogan.
Noting Hogan’s campaign emphasis on creating jobs in the state, Leggett reiterated past contentions that the Washington suburbs are one of two regions in the state—the Baltimore area being the other—capable of producing jobs on a large scale, but that creating transit is an integral part of the equation.
“Our newest governor…does not come in with a history of the project [and] may not understand how this is interrelated to his own vision,” Leggett told the audience. “We need you to help us carry that message.”
Alluding to the near life or death power that Hogan has over the project under Maryland’s constitutional system, Leggett added: “This is a very simple, straightforward process. We’re not asking [you] to convince the rest of Maryland of the worthiness of this project. We’re not asking that we have to go and convince every editorial board around the state. We’re basically asking to convince one person to follow what he has outlined for the state of Maryland—that is our governor.”
Economic Partners of the Purple Line, a coalition of Washington area developers and business leaders, is planning a day of lobbying in Annapolis on March 9, according to Miti Figueredo, a vice president of the Chevy Chase Land Co. Figueredo’s firm is redeveloping the Chevy Chase Lake area, the site of a planned Purple Line station. She also said the coalition is trying to schedule a meeting with the state’s new transportation secretary, Pete Rahn, whom Hogan has tasked with conducting the Purple Line evaluation.
Rahn twice in the past week has told a state Senate committee that he will try to complete his review of the Purple Line and Red Line projects prior to the adjournment of this year’s General Assembly session in mid-April. In addition, in a statement earlier this week, the Maryland Department of Transportation said March 12 remains the due date for bids from private partnerships—so-called concessionaires—interested in building and operating the Purple Line. “That date is the date we’re watching now, and I think there’s certainly a chance that it might slip a little bit,” David Iannucci, a senior economic development adviser to Baker, told Wednesday’s gathering.
Even as the Hogan administration evaluates whether to go ahead with the Purple Line, some pre-construction activities—such engineering work and appraisals of land needed for the route—are moving ahead, although major right-of-way acquisitions are likely to be delayed until the project’s status is clarified. If the Hogan administration ultimately gives the project the green light, such activity would presumably enable the Purple Line to begin construction in late summer, as had been planned under the administration of former Gov. Martin O’Malley.
But sources indicated that if the March 12 bid deadline—which already has been pushed back from a date in early January—is postponed further, it would delay the construction schedule. In the past, state officials have warned that each month of delay in beginning construction translates into several million dollars in cost escalation.
There has been speculation that the state may allow the bidding to go ahead on March 12 as part of the overall Purple Line evaluation process to see precisely how much financing private partnerships are willing to come up with. That, in turn, could determine how much state financing would be required, which could then be a key factor in deciding whether to go ahead with the project.
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Pending receipt of the bids, estimates have put private financing for the project in the $600 million to $1 billion range, with the required state share being anywhere from $300 million to $700 million. However, because the state already has spent nearly $110 million toward pre-construction activities for the Purple Line, the remaining state share would likely fall in the $200 million to $600 million category. The remainder of the project would be financed by $900 million that the federal government is moving to provide, along with about $120 million each from Montgomery and Prince George’s counties.
However, the strategy of soliciting bids from the four interested concessionaires and then deciding not to go ahead with the Purple Line has risks: Several sources suggested that the move could produce complaints from the bidding firms that the state had acted in bad faith, and discourage private partnerships from submitting bids for future Maryland projects.
Meanwhile, Iannucci, who was the state’s secretary of business and economic development under former Gov. Parris Glendening, expressed concern about recent comments by Rahn. According to the Maryland Reporter, the new transportation secretary told the Senate Budget and Taxation Committee last week that his evaluation would consider the costs of operating the Purple Line and Red Line, and whether these costs are desirable as compared to revenue.
“This idea of weighing costs versus revenues…frankly makes me nervous,” Iannucci told the business leaders. “There is not, to my knowledge, a mass transit system in the world that breaks even from the farebox perspective. So, the question is, what level of support does he expect?”
As a rule, the Maryland Transit Administration, which would operate the Purple Line, recovers about 30 percent of operating costs from fare revenues.
Pie chart breakdown of funding sources posted above from Maryland Transit Administration's presentation to the 2015 General Assembly on Jan. 28.
