Milwaukee County Executive Scott Walker said he was caught by surprise this morning by Milwaukee Mayor Tom Barrett's announcement that the federal Omnibus Budget bill includes a provision to spend $91.5 million in long unused federal funds for mass transportation in Milwaukee.

The provision dedicates spending $54.9 million for a proposed downtown streetcar system and $36.6 million for Milwaukee County electric buses.

The funds were originally part of a $291 million federal appropriation in 1991 for Milwaukee area mass transit.

When the federal transit funds for Milwaukee were originally allocated, they could only be spent on projects that the mayor, county executive and governor agreed upon. However, Walker and Barrett never came to an agreement on how to use the money.

To break the stalemate, Barrett said he worked with Sen. Herb Kohl (D-Wis.), Rep. Gwen Moore (D-Milwaukee) and Rep. David Obey (D-Wausau) to change the terms of the transit allocation to bypass Walker's objections.

"It's just an end-around," Walker said. "And it's not just an end-around me, it's an end-around the County Board. The board has gone on record supporting bus rapid transit. The fact that the mayor on his own is doing this just seems to me to be an end-around the whole process. It is what it is. There's nothing we can do."

Patrick Curley, Barrett's chief of staff, said the mayor had no other choice but to go to Congress to break the funding gridlock, because Walker refused to negotiate how to spend the funds.

"It had to happen," Curley said. "There was no other way for this to move. I think the mayor's frustration was shared by members of the congressional delegation. The county executive made it clear from day one he wanted to part of rail. That has never been the city's position. Something had to happen."

Additional funds needed

The funds for the streetcar will "probably not" be enough to establish the system, said Curley. However, the federal funds should cover most of the costs, and additional federal and state funds should be available, Curley said. State and federal funds will also be available for operating expenses, in addition to fare box receipts, he said.

Local funding may be necessary for the streetcar system, which could come from a variety of sources including tax incremental financing (TIF) or parking surcharges, Curley said.

Barrett hopes the system will be operated by a regional transportation authority.

"We would prefer that buses and rail be operated by a regional transit authority," Curley said.

Local officials are trying to decide how an RTA for Kenosha County, eastern Racine County and Milwaukee County could be funded.

"It is absolutely vital that we remain focused on the long-term needs of this region's transportation system and ensure that we have a dedicated funding source secured for the operation of these systems, not just the federal capital dollars to build them," said Karl Ostby, chairman of the Southeastern Wisconsin Regional Transit Authority (RTA).

"These funds (for the streetcar and electric buses) will address some capital needs but will not serve to fund the operating or maintenance costs that will coincide with such projects. In light of this development, a dedicated funding source for transit remains crucial to providing ongoing, integrated, appropriately funded transit services to the residents of our region."

The next step for the Downtown streetcar project is to conduct preliminary engineering, Curley said. Currently the plans for the project are little more than lines on a map. The Downtown streetcar route will run along St. Paul Avenue, North 4th Street, Juneau Avenue and Jackson / Van Buren streets.

Travelers arriving in Milwaukee via train or bus at the downtown intermodal station would be able to use the streetcar to get to within a few blocks of almost any Downtown destination.

The streetcar route is adjacent to the U.S. Bank Center, the Northwestern Mutual Life Insurance Co. headquarters, the Bradley Center, the U.S. Cellular Arena, the Midwest Airlines Center, MSOE, the Hyatt hotel, the Shops of Grand Avenue and the Milwaukee Public Market. Other destinations including the Manpower Inc. headquarters, Milwaukee Art Museum, Milwaukee Public Museum, Milwaukee Area Technical College, the Milwaukee County Courthouse and the Hilton hotel are between one and five blocks from the streetcar route.

The Marquette University campus is seven blocks from the streetcar route.

Walker's plan

The $36.6 million that will be provided to Milwaukee County will most likely be used to create a bus rapid transit line from the Milwaukee County Regional Medical Center complex in Wauwatosa through Downtown Milwaukee to the University of Wisconsin-Milwaukee campus on the east side, Walker said.

The county is also working on creating a bus rapid transit line from the far northwest side of Milwaukee down Fond du Lac Avenue, through Downtown Milwaukee south to National Avenue and then west to the State Fair Park area in West Allis. The county is seeking federal funds for that project.

If both projects come together, Milwaukee County could have two bus rapid transit lines operating by 2011, Walker said.

"We all along have said (federal transit funds) should go toward improving and upgrading the bus system," Walker said.

The move means that the $54.9 million for the Downtown streetcar will not be spent to improve the county bus system, and the state will probably cut transit funding to the county by about $3 million a year to provide funds for the city's new streetcar system, Walker said.

Local transit systems typically rely on significant state funding contributions, he said.

"Funding should not be siphoned off to benefit a small number of Downtown riders," Walker said.

Walker said that he hopes the Milwaukee Common Council will put the brakes on the streetcar plans when they examine the details, including operating expenses.

Enthusiastic supporters

However, Ald. Robert Bauman, who represents the Downtown area and is a major rail advocate, said he was elated with today's news about the federal transit funding.

"Outstanding news," Bauman said. "The impasse has been broken after 17 years. It is not only possible but very likely that action will be taken. We have moved very far towards establishing a rail-based transit system in the city of Milwaukee. The exact details are not crystal clear yet in terms of what can be built for the amount of money we have. But with the public share we will be able to build a $64 million rail project in the city of Milwaukee I'd say within the next three to five years.

"This puts us into the modern age, into the 21st century. There are dozens and dozens of cities, many of which are smaller and with less population density than Milwaukee, which have experienced great success in terms of ridership and public acceptance (with rail systems). Right now we are behind the curve. This means that we will be able to catch up to our peers."

However, Walker said the Downtown streetcar will be little more than a "tourist trolley," that will attract few riders and will do nothing to serve low-income residents who rely on mass transit to get to work every day.

Others today hailed the news that the deadlock over the federal transportation funds is finally broken and plans for the downtown streetcar can move forward.

"Great tourism destinations, with few exceptions, have a great transportation infrastructure, whether it's buses, trains, subways, light rail or a combination," said David Fantle, vice president of public relations for Visit Milwaukee. "Public transit is essential for providing access to jobs, transporting people to and from art and cultural events and promoting tourism in general. An improved transportation infrastructure will be yet another positive selling point in promoting Milwaukee as a tourism destination."

"I think anytime that we can get the public transit moving is a good thing," said Dean Amhaus, president of Spirit of Milwaukee. "The notion of a type of connector service has always been well received by our board and if this leads in that direction things are very encouraging. From what I have experienced in other cities, a transit like this is a magnet for young people, and it is certainly something that I, and others like me, would use in my own service of getting around town because it is very simple and convenient. Something like this is a big draw to get more people Downtown."

At least one local business could benefit directly from the streetcar project. However, Super Steel Corp., a Milwaukee-based manufacturer of rail cars and related products, has not yet learned if it will be able to bid on the streetcar project, said Jim Schmelzer, president and chief executive officer. Super Steel is a subcontractor for rail projects and is hired by general contractors such as General Motors Corp. and General Electric Co.

"We are going to be digging to find out who is making them and get our foot in the door," Schmelzer said. "We'd love to help produce those."

Downtown business owners contacted by BizTimes Milwaukee today expressed interest in the potential a streetcar system would have on the city.

Bob Welke, president of The Welke Group in Downtown Milwaukee, said, "I'm in favor of the Downtown streetcar system. It's been proven in other cities, both here in the U.S. and abroad. When the price of gas goes up again -- and it will -- we're going to wish we had it. And that's not to mention the problems of pollution, parking and the fact that the city's grim revenue picture puts us years behind in road repair and upkeep. While I think that a rapid bus transit system for the county is probably a good thing short-term, I believe that the whole notion of 'Milwaukee County' is out-of-date. We need to think on a much broader regional basis. We need to link Chicago to Milwaukee and Madison. The county, and the county government as it currently exists, has little or anything to do with the reality of the way our business and cultural trends are taking us."