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Research Department ' <br />Minnesota House of Representatives <br /> <br />April 21, 2004 <br /> Page 2 <br /> <br />trips in 2025. It was assumed that ridership would rise at the rate of 92.3 daily trips per year <br />from 2008 to 2025 in order to get from 4,030 to 5,600, and at the same rate from 2026 to 2047.3 <br /> <br />Using all these estimates, it was possible to estimate the public cost per one-way trip. This was <br />derived by dividing total public costs (total capital cost including debt service on an annualized <br />basis, p. lus total operating subsidy on an annualized basis) by total one-way trips. For the 22- <br />year period the average annual public cost was $14.57 per trip, and for the 40-year period the <br />average annual public cost was $10.40 per trip. <br /> <br />Obviously there are pitfalls inherent in attempting to forecast operating costs, farebox revenue, <br />and ridership over a forty-year period for a rail line that is not yet operational. For this reason <br />the estimates should be regarded as projections based on a set of assumptions rather than as hard <br />figures based on certainties. <br /> <br />Please let me know if you have further questions. <br /> <br />31 am convinced that cost per trip is a more accurate and defensible measurement than cost per rider. The estimate <br />of 2,800 riders in 2025 (assuming each one-way trip is half of a roundtrip) is a daily estimate. Dividing that figure <br />into an estimate of annual capital and operating cost will inevitably produce an inflated figure. If it were known for <br />certain that it would be the same 2,800 people r/ding the train each day then the figure could be divided into the <br />annual cost to produce an annual "cost per rider." Since that information is not known there is no way to accurately <br />estimate the total number of individuals who will take the train. <br /> <br />Copied Attachment: <br /> <br />TOTAL PUBLIC COST OF NORTHSTAR RAIL OVER 22 AND 40 YEARS <br /> <br />Capital cost -- federal share <br />Capital cost -- state share including interest on state bonds <br />Capital cost - local share <br />Total capital cost <br />Average annual capital cost <br />Average annual operating subsidy <br />Average annual capital cost + annual operating subsidy <br />Total annual average one-way trips <br />Average annual capital cost + subsidy per one-way trip <br /> <br />Over 22-year life Over 40-year life <br />of state bonds of the project <br />$ 132,500,000 $ 132,500,000 <br />$ 132,624,830 $ 132,624,830 <br />$ 44,200,000 $ 44,200,000 <br />$ 309,324,830 $ 309,324,830 <br />$ 14,060,220 $ 7,733,121 <br />$ 6,545,399 $ 9,484,669 <br />$ 20,605,619 $ 17,217,790 <br /> 1,414,491 1,656,339 <br />$ 14.57 $ 10.40 <br /> <br />CALCULATIONS FOR THE ANNUAL PER DALLY RIDER SUBSIDY: <br /> <br />$14.57 X 2 (for round trip) = $29.14 <br />$29.14 X 5 (for one work week of single rider round trips) = $145.70 <br />$145.70 X 52 (for single rider work week round trips per year) = $7576.40 <br /> <br />Average cash assistance fora needy mother with two children is $7500 per year. <br />This figure does not include health care of child assistance. - Source: House Research <br /> <br /> <br />