Traverse City-Ann Arbor Train Service Could Generate $100M Annually, Report Finds

Reestablishing train service between Traverse City and Ann Arbor could attract 1.5 million riders and generate nearly $100 million in revenue annually by 2040, according to a report being released today (Monday) by the Groundwork Center for Resilient Communities.

The report is the result of a six-month study spearheaded by a steering committee that includes the Groundwork Center, Bay Area Transportation Authority (BATA), the Michigan Department of Transportation (MDOT), and the Michigan Association of Railroad Passengers. Funding for the A2TC project, as it’s called, comes from a federal transportation planning grant and local matching funds from MDOT, the City of Alma, City of Traverse City, Petoskey Area Visitors Bureau, Petoskey Downtown, Traverse City Tourism, and Washtenaw County. Reestablishing a passenger line to northern Michigan has been identified as a goal in Michigan’s State Rail Plan, with existing tracks already in place between Traverse City and Ann Arbor (as well as a further leg north to Petoskey).

The report, prepared by consulting firm Transportation Economics & Management Systems (TEMS), estimates that 6 million visitors come to the Traverse City-Petoskey region annually now and predicts that rate will grow by 4 percent each year, eventually doubling to nearly 12 million visitors by 2040. “Nearly half of the trips to the Traverse City and Petoskey region are coming from the metro Detroit area,” a Groundwork Center summary states, “so the existing visitors could be a good test market. In other words, what if a percentage of those existing visitors could leave their cars at home?”

Providing continuous rail service from Detroit to Traverse City or beyond will require significant investment, the study shows. But the ridership potential is high enough to offset those costs, TEMS believes. The firm’s report looks at three scenarios: establishing a 60mph “special event” train, a 90mph train, and a 110mph train.

A 60mph train would require approximately $40 million in track repairs and would provide a five-hour trip between Traverse City and Ann Arbor. Even at this speed – slower than a car trip, which takes an average of four hours – the train would attract an estimated 336,000 riders and generate $14.6 million in annual revenue by 2040, estimates show. But as investment increases to allow for faster trains, so does the estimated number of riders and revenue.

A 90mph train could make the trip in 4.5 hours and would require an additional $611 million in repairs, but would attract an estimated 966,000 riders and generate $51.1 million annually by 2040. Meanwhile, a 110mph train – which would require completely replacing the tracks, a cost that could reach up to $1 billion – would cut the trip time to just 3.5 hours. Such a trip would be significantly more favorable to travelers, increasing the predicted annual ridership to 1.5 million and revenue to nearly $100 million by 2040.

“It can be seen that revenues increase strongly as both travel speed and frequency increase,” TEMS reports. “In addition, as the socioeconomics, highway congestion, and gas prices increase, rail revenues are anticipated to increase by some 40-50 percent for all options over the 20-year period (from) 2020 through 2040. This increases the ability to pay for operating costs in the future as market conditions become increasingly favorable to rail.”

Other key findings from the report encourage exploring a connection between Williamsburg and Kalkaska – in addition to the extension to Detroit – and emphasizing that the line will not only connect multiple Michigan cities but several major colleges and universities as well. An estimated 90,000 students live along the route, which would connect the University of Michigan, Central Michigan University, Baker College, Alma College, Northwestern Michigan College, and North Central Michigan College. Both TEMS and Groundwork Center believe the best approach is to make 110mph train service “a long-term goal,” making near-term investments into the corridor’s infrastructure that will both allow for slower train service now and eventually high-speed rail in the future. “I thought 110mph trains were out of the question and basically crazy at first, but you’re getting so much ridership and revenue that it will more than cover the operating costs,” says Groundwork Center Deputy Director Jim Bruckbauer. “(TEMS) really changed my opinion based on this study.”

The first step in reestablishing rail could take place as soon as 2019, when MDOT plans to repair a section of track near Traverse City that will allow trains to come all the way into the city. “Almost all of the corridor does allow for special event trains right now, but because of the condition of the tracks, they have to stop south of Traverse City and can’t carry passengers in,” says Bruckbauer. “Once they repair the tracks, the train can come right into town.”

The study recommends launching “excursion” or special-event trains by 2020 that would test the market and allow riders to experience rail at the 60mph level. Such trains could include a National Cherry Festival or Traverse City Film Festival train, or a weekend outing to a University of Michigan football game. In three to five years, the report recommends creating a nonprofit management company that would be responsible for developing an operating plan and schedule for the corridor and fundraising for further investment into track repairs. Over the next decade, the study recommends gradually expanding into regular 60mph service and then 90mph service, with high-speed 110mph rail achievable in 15-20 years.

Bruckbauer says the consulting team will present the report findings in a series of community meetings and public events planned for November (schedule to be announced). TEMS is also completing an additional phase of study right now that will evaluate “the economic benefits in each of the communities that the train would stop in and where the stations should be located within those towns,” Bruckbauer says. Those details could potentially be ready to be shared in November. The Groundwork Center is excited to support the potential return of rail between northern Michigan and downstate, Bruckbauer says, a project that could “take thousands of cars off the roads and provide people with a direct, downtown-to-downtown connection between Michigan’s cities.”

“The passenger rail project will be valuable in attracting the next generation workforce that wants to live and thrive in Michigan without always depending on a car to get around,” Bruckbauer says.