News Release

KRM Commuter Rail Plan’s Supposed Economic Benefits Aren’t Credible; System Would Require Massive Subsidies

Reason Foundation report outlines several better transit options for region

Los Angeles (December 16, 2008) – The claimed economic benefits of the proposed commuter rail line for the Kenosha-Racine-Milwaukee corridor are “not credible” and other transit options should be studied, according to a new study by Reason Foundation, a free market think tank.

The University of Wisconsin-Milwaukee analysis of the local economic benefits of the construction of the rail line wrongly assumes all expenditures, and jobs created, would be local, even though there is no local capacity to produce many of the components, such as the $48 million rail cars. And the $2.1 billion increase in property values the rail project alleges would mean that each of the 3,696 projected 2035 round-trip riders would be “worth” $568,000, a claim that “cannot be taken seriously” the Reason Foundation concludes.

Reason Foundation finds every new passenger boarding the commuter rail system would cost $28. Yet passengers would pay just $2.92 for a ticket, meaning taxpayers would subsidize over $25 for every new one-way rail passenger. By comparison, the total cost per passenger for the Milwaukee County Transit System (MCTS) in 2007 was $3.

“Amidst a recession and tough economic times, it is more important than ever to make decisions based on cost-effectiveness and benefits to citizens.” said Tom Rubin, author of the Reason Foundation analysis and a transit consultant.

The rail plan fails to identify a source of funding for the approximately $20 million Muskego Bypass and the over 50 at-grade crossings along the route will pose serious safety and traffic congestion issues, the study concludes.

The Reason Foundation report says several other flexible and affordable transit options have been ignored entirely, or “given short shrift,” and should be studied in-depth. These include:

  • I-94 Commuter Express Bus: Long-haul express bus service would make sense as a substitute for or as a supplement to commuter rail along the Lake Michigan shoreline and should be studied. Express buses are low risk and would require a much smaller upfront investment than commuter rail.
  • Bus Rapid Transit (BRT) Lite: This alternative would involve buses operating on city streets without special guideways. In Los Angeles, a similar program has increased bus route speeds by up to 25% and ridership by over 40 percent.
  • Carpools and Vanpools: The study states, “While vanpools will rarely capture a major share of the home-to-work trips, they will often provide among the greatest return on investment on taxpayer dollars that is available to governmental transportation decision-makers and staffs.”

Full Report Online

The full study, Kenosha-Racine-Milwaukee (KRM) Corridor Transit Service Options: An Investigation and Analysis, is online at

About Reason Foundation

Reason Foundation is a nonprofit think tank dedicated to advancing free minds and free markets.


Chris Mitchell, Director of Communications, Reason Foundation, (310) 367-6109