Whenever we build a piece of large-scale infrastructure, we should be thinking about the markets it serves today, and the market it serves over its lifetime. We are often building lines that aim to promote development. That is, they are serving non-places in the hope they become places. The evidence on this is mixed. Sometimes lines successfully promote development, sometimes they don’t. If the lines were privately built (as in times of yore), this would be much less of public policy question, as the public is not bearing the monetary risk. That is not to say there are no policy questions, the line-builder wants right-of-way, and that often requires eminent domain powers.
However the lines are now publicly built, so the public is bearing the risk so that the privately owned lands might appreciate in value, and the public might get a small share of that increment. Usually we don’t employ value capture. General tax revenues are not nearly enough to justify the line, since lines are expensive now — all the good lines, the low-hanging fruit, have been built, and most development is a transfer from one place to another.
The risk is the capital outlay will not be recovered from future revenue (from users, or non-users).
In contrast, building lines where people actually are, where demand currently exists, presents much lower risk in revenue projections.
Lines typically last upwards of 60 years with a given technology. We certainly cannot predict 60 years into the future. 60 years ago was before both the Shinkansen and the Interstate Highway System. Predictions from 60 years ago about today were not terribly accurate. Sixty years is longer than a Kondratieff Cycle.
Will today’s places have any activity in 60 years? A good test of that is whether the place had activity 60 years ago. Look at the map of 60 years ago. Where was the activity? Where is it today? The intersection of those two maps show places with proven longevity. There are no guarantees those places will have activity in 60 years of course (“past performance is no guarantee of future results”), but they are more likely to because there is an underlying cause for the stability of the place. That is, there was a cause for that place to develop in the first place (e.g. a useful waterfall, a port, or a junction between intercity rail lines), and the positive feedback structure between transportation, accessibility, and land use actively worked to reinforce the strength of that place.
Applying that to the Twin Cities, the best prediction you can make is that there will be strong demand between Downtown Minneapolis and Downtown St. Paul. We currently serve that corridor with interstate highway and transit.
Applying that again to the Twin Cities, the newest places (if we can call them that) outside the beltway are making claims for long-term investments of resources fixing them into the urban system without the evidence of long-term stability (See e.g. the SW LRT to a park and ride lot on Mitchell Road, or Highway 212, or the Bottineau Line to a cornfield, or Highway 610). It is certainly possible those destinations will become significant demand generators, but it is far from certain. If a private firm wanted to bear the risk of those prospective developments not working out, more power to them. But the public is asked to do this, while perfectly good markets go unserved or underserved for lack of capital.
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