By CHRISTINA RITCHIE ROGERS
DavidsonNews.net

CHARLOTTE - The Red Line Task Force is looking to extend the deadline it set for reviewing plans for a commuter rail line north of Charlotte to give local governments, the state, Charlotte Area Transit System and Norfolk Southern Corp. more time to analyze financial and operational assumptions.

The task force had hoped to get feedback from the seven local governments along the line, CATS and the N.C. Department of Transportation by the end of March. The plan then would be revised and sent to back local governments for approval in June. But recent feedback from Norfolk Southern Corp., which owns the tracks between Charlotte and Mooresville, has thrown a wrench in the original plans.

In a letter sent Tuesday to the N.C. Department of Transportation, Norfolk Southern’s general director for passenger policy John Edwards said that while the rail company “stands ready to study” the project, it believes the current plan to bring commuter rail to the Lake Norman area is “fatally flawed” and based on outdated assumptions. The letter was the second in two months in which the rail company expressed concerns about the project.

The Red Line Task Force developed the proposed plan based on old assumptions about the technical and operational needs for the rail line, Norfolk Southern said.

On Wednesday, the N.C. DOT official working on the project said Norfolk Southern’s objections have changed the picture. “They very clearly said their assumptions have changed, therefore we need to start over,” NC DOT Deputy Secretary of Transportation Paul Morris said at the Red Line Task Force meeting at Charlotte Mecklenburg Government Center. But the problem is with the technical assumptions, and not with the financial model, Mr. Morris said.

Based on the letter and his subsequent conversations with Mr. Edwards, Mr. Morris is optimistic and believes that the railroad is willing to work to identify its technical and operational needs and to update its previous assumptions.

Bobbie Shields, a general manager in the Mecklenburg County manager’s office, asked whether the results of Norfolk Southern’s new analysis could mean an increase in project costs, citing a line in Tuesday’s Norfolk Southern letter that reads: “It will be an expensive process for NCDOT.”

“I take that at face value and will meet with them and try to figure out what they mean by that,” Mr. Morris replied. Without knowing what the new assumptions will be, it is hard to say whether estimated costs will increase, he said.

The current business plan caps project costs at $452 million in 2018 dollars, and a significant amount of that relates to rail improvements, Mr. Morris said. The Red Line plan envisions the costs being shared. The state and CATS would pay $113 million each and local governments would be asked to raise the remaining half, or $226 million.

The local share wouldn’t come through an increase in the tax rate, officials say. Instead towns and county governments are being asked to adopt two financing tactics: Tax Increment Financing (TIF) districts, which would dedicate a portion of future increases in tax revenues from properties along to the rail line; and Special Assessment Districts (SAD), where commercial property owners would be given a chance to vote on whether to assess themselves special fees to help pay for the project.

The local financing plans depend on full participation by local governments and, consultants say, on conservative projections about anticipated growth in property values along the line. Red Line officials say if any government opts out, the project can’t go forward. Iredell County Commissioners already have said they don’t support the financing plan in its current form.

MORE TIME NEEDED

Red Line task force officials had said they hoped to have local government comments by the end of March. But allowing time for Norfolk Southern’s review means the task force must extend that deadline, Mr. Morris said Wednesday.

“The whole planning process built in some cushion,” Mr. Morris said, “to allow for the unexpected.” And the Norfolk Southern letters were unexpected, he said.

Red Line officials said while a lengthier review is feasible, too long a delay could imperil the project. While there may be some flexibility in the plan’s “soft” deadlines – those set for the review and analysis period and for the time at which special assessments are implemented – two key deadlines remain “hard”:

• Dec. 31, 2012, the last day tax increment financing (TIF) districts could be established based on 2012 property values. The TIF values would set the financial base for the project. By establishing the TIF districts before then, local governments would lock in the 2012 property values and assess taxes according to those numbers for the duration of the project. If the towns miss that deadline, property values would not be locked in until Dec. 31 2013 (or later), allowing for a year of appreciation in a recovering economy.
• June 30, 2013: State legislation allowing Special Assessment Districts will expire.

“I would suggest to you, do nothing to jeopardize those two dates,” Task Force Chair and Davidson Mayor John Woods said at Wednesday’s meeting.

He and the other task force members agreed that the financial plan analysis and review deadlines should be extended to allow Norfolk Southern ample time for its technical review – through the spring and summer – and Mr. Morris recommended the task force again invite Norfolk Southern to meet as a group. In recent months town leaders have questioned why the task force did not discuss plans with Norfolk Southern sooner, and Norfolk Southern representatives only recently have started attending Red Line meetings. No one from Norfolk Southern attended the meeting Wednesday night.

But Mr. Morris, Mayor Woods and the other task force members see the recent letter as both acknowledgement of a problem and a willingness to work together to solve it.

“This is not a negotiation (with Norfolk Southern) yet but this is standard business process,” Mr. Morris said. “This is really a technical discussion more than anything else.”

RELATED LINKS

See previous coverage of the Red Line Regional Rail Project on DavidsonNews.net.

Find more information, project documents and a Q&A on the project website, RedLineRegionalRail.org.

AUDIO

Listen to an audio replay of Wednesday afternoon’s Red Line Task Force meeting at Charlotte Mecklenburg Government Center. Chair John Woods opens the meeting, and is followed by reports led by consultants Katherine Henderson and Mark Briggs, with local officials. Click the play button to start. Can’t see the player or hear the audio? CLICK HERE>

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(MP3, 1 hour, 5 mins.)