For years advocates for light rail have been trying to convince the legislature to allow Maricopa County to extend the 1/2 cent transportation sales tax (currently set to expire in 2025) to include billions more for light rail. They know that they can’t pass light rail by itself, so they have been looking for ways to sneak it by lawmakers by tying it to other more popular transportation projects.

Their solution is SB 1147, a poorly crafted transportation omnibus bill that would eliminate the statutory spending caps on how much money can go toward light rail and other wasteful transit projects. The bill would also remove the requirements that funding go toward freeways and other regional roads, unnecessarily create duplicative and confusing new statutes for rural counties and allow new tax hikes to be considered on off-cycle election dates that are notorious for low voter turnout.

The evidence that light rail and similar fixed line transit is a bad deal for taxpayers is overwhelming. In 2017, the Free Enterprise Club published a study on the future of transportation policy in Maricopa County and the value of light rail in the Phoenix Metro Area. The conclusion was that light rail is a bad deal for taxpayers, commuters, non-politically connected landowners and anyone else that relies on the current bus transit system. Additionally, a cursory review of the wild-eyed economic development claims being made by proponents of rail are easily disproven as well.

The most critical facts when considering light rail include:

  • Light rail will NOT reduce traffic congestion–it will INCREASE traffic congestion

A common myth pushed by proponents of light rail is that it will help in getting people off the roads and into public transit. The fact is that light rail will increase traffic congestion, and there are a couple of reasons for this. First, the only way to accommodate the new rail line will be to remove street lanes currently used by automobiles. And since street lanes can move more traffic per hour than light rail, congestion will be greater along the line. Secondly, since the rail line is moving at street grade, it will have to receive priority at every traffic light. This will disrupt signal coordination systems, spreading the disruption well beyond the light rail intersections. That is why every independent traffic analysis that has been done concludes that light rail increases traffic congestion.

  • Light rail will NOT increase transit ridership and will HURT bus ridership

Another argument made by the light rail lobby is that building light rail will increase transit ridership. The fact is most light rail passengers are either individuals who already use transit or passengers who were forced onto light rail when existing bus service along the rail line was eliminated. Additionally, since rail costs substantially more to operate than buses, over time light rail will crowd out bus service and will result in a reduction of bus lines in the Phoenix metro area.

This is not speculation—this exact scenario has played out in every city that has built light rail. For proof, here is a chart showing transit ridership in the Phoenix metro area since 2000, courtesy of Valley Metro:

As can be seen by the chart, transit ridership was increasing steadily from 2000 to 2008, prior to light rail opening. After light rail opened, bus ridership began to plummet and is now at levels not seen since 2003. Even more troubling, after a decade of growth annual transit ridership has been in decline.  The 2017 figures were just released and annual transit ridership is now LOWER than when light rail opened in 2009.

  • The Economic Development Claims are False

Knowing that light rail cannot be defended for reducing congestion or increasing transit ridership, advocates usually pivot to the claim that rail should be built since it promotes economic development.  This claim is easily disproven as well. After a careful analysis of the figures provided by Valley Metro, the Club proved that most of the economic development credited to light rail was either “planned or committed” development, projects that had nothing to do with rail (like the Phoenix Convention Center) or were projects that never occurred.

After discrediting their figures in 2015, Valley Metro released a new analysis, now claiming that billions in constructed projects have occurred because of light rail. How did they reach this conclusion? Valley Metro is now assuming that light rail is responsible for ALL economic development that occurs within 1/2 mile of the rail line. Since the rail line is 26 miles long, that means they are including 26 SQUARE MILES within their analysis. The idea that light rail is responsible for all economic development in an area the size of Queen Creek is laughable.

  • SB 1147 Ignores the Blossoming Self-Driving Transportation Revolution in our own Backyard

The final nail in the coffin for light rail is that it is more likely than not that drastic advancements in autonomous vehicles will render the service useless and unused. Thanks to Governor Ducey, Arizona has become a leader in promoting and developing self-driving technology, and it is anticipated that such cars will be available to the public in the next five years. The idea that we are going to commit billions to human-operated, fixed line rail through 2045 when the technology will be beyond obsolete would be a huge mistake.

If lawmakers believe there is a need to update our existing transportation statutes or even consider extending the Maricopa County transportation tax, policy makers should make sure that the money is used on productive transportation projects that include plenty of transparency and oversight. Without drastic changes to SB 1147, the bill will remain a train wreck for taxpayers.

If you enjoy using the internet, prepare to hide your wallet. A coalition of cities throughout Arizona have announced their intention to impose massive new tax increases on a wide array of currently untaxed digital products, targeting popular streaming services and applications such as Apple iCloud, LegalZoom and Pandora.

This outrageous plan to tax everything on the internet manifested itself from good faith legislation introduced at the Capitol earlier this year to clarify what digital products should (and should not) be taxed. Arizona law has been silent on the issue, and the Department of Revenue has struggled to develop rules to differentiate digital goods from digital services, which is an important distinction since Arizona has historically not taxed services.

HB 2479 and SB 1392 were introduced after lengthy bipartisan discussions that included input from the private sector and taxing entities, including the cities. The conclusion from those meetings was that taxing online digital services was a terrible idea that was contrary to legal precedent and would put Arizona at a competitive disadvantage, since most other states do not tax similar internet products.

Yet the allure of new revenue from internet taxation has led the League of Cities and Towns to oppose both bills. They have made it clear that no restrictions should be placed on their internet taxing powers, a radical position that could lead to digital goods and services becoming one of the MOST taxed items in Arizona. Even more stunning is that their plan is likely illegal and would violate federal law.

This is not an issue that lawmakers can remain on the sidelines. If local governments get their way, internet users will be hammered with a slew of new taxes, while digital startups and capital investment will be driven to other states much friendlier to the tech industry.

Action must be taken soon to protect taxpayers and slam the door shut on the digital internet tax. We urge everyone to contact your lawmakers to vote YES on HB 2479 and SB 1392.

The Following is a Press Release Issued by Citizens Against Prop 417, the Grassroots Committee Opposed to the Pinal County Transportation Tax Increase:

Casa Grande, AZ (October 30th)–In their effort to pass an illegal, unnecessary tax hike in Pinal County, the backers of Prop. 417 have raised $200,000 dollars from developers, lawyers, construction companies and auto dealers based in Maricopa County.  To date the special interest funded “yes” campaign has outspent the opposition 30 to 1.

“It’s not surprising that well-funded special interests from Maricopa County want to raise our taxes. Many of these companies are going to profit immensely from Prop 417 while we are stuck paying the bill.” said Harold Vangilder, Casa Grande Resident and Chairman of Citizens against Prop 417.

According to their campaign finance report filed October 15th, the “New Roads and Freeways before it’s too late” committee raised 95% of their campaign war chest from Phoenix area special interests. Another $10,000 came from Texas. Less than 1% of the money raised in support of Prop 417 came from Pinal County.

“This entire transportation plan is bought and paid for by Phoenix area developers and lawyers.” Said Richard Brinkley, SaddleBrooke resident and Treasurer of Citizens against Prop 417. “Why should we pay for a tax hike that benefits them?”

In addition to Prop 417 being a Maricopa county funded scheme, all of the vendors used for the campaign are based outside Pinal County. Not a single person living in Pinal County was utilized in their campaign spending spree.

Opposition to Prop 417 has been growing rapidly over the last several weeks as Pinal residents learn more about the $640 Million tax increase. Not only is the current transportation tax being wasted and abused, but the County has been notified by a non-profit watchdog organization that Prop 417 is illegally drafted and will be heading to court if it passes.

“The County continues to ignore the legal issues associated with Prop 417, and now we find out that the entire campaign is being funded by outside interests that won’t even have to pay the tax.” Said Peggy Knowles, Pinal County resident and former President of the Republican Women of Pinal County. “Their hypocrisy and arrogance is unbelievable.”

The campaign finance report for “New Roads and Freeways before it’s too late” can be viewed by clicking HERE.


Paid for by Citizens Against Prop 417. Not Authorized by any Candidate or Candidate Campaign Committee

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The Arizona Free Enterprise Club is a free market policy and advocacy group dedicated to promoting a strong and vibrant Arizona economy.