Bonds part of a mass transit expansion plan eyed in Oklahoma

Oklahoma City streetcar
The 4.8-mile Oklahoma City Streetcar line would be joined by additional transit alternatives under a plan supported by Oklahoma City Mayor David Holt.
Bloomberg News

Commuter rail and expanded bus rapid transit could come to central Oklahoma under a plan to seek voter approval next year for a dedicated sales tax that would be used to pay off bonds. 

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The plan, estimated to cost about $1.8 billion for a rail system connecting downtown Oklahoma City to Edmond and Norman and $730 million for bus transit, is being formulated by ONE Transit, the new name for the Regional Transportation Authority of Central Oklahoma. 

In his July 15 State of the City address, Oklahoma City Mayor David Holt pushed for more public transit to accommodate a population he predicted could reach 1 million by 2050 or 2055.

"Collectively, this plan will preserve our quality of life by alleviating traffic congestion, it will preserve the mobility necessary to keep our economy strong and growing, and it will spur commercial development, among other benefits," he said. 

A coordinated sales tax election among ONE Transit's member cities — Oklahoma City, Norman, and Edmond — would need approval initially by the transit agency's seven member board of directors and then by the city councils, according to Suzanne Wickenkamp, ONE Transit's director of strategic initiatives.

Edmond and Norman are about 30 miles apart, with Oklahoma City in the middle.

"Three quarters of that approximate one-cent sales tax would go to funding the construction of high capacity transit, it would fund the operating costs of that high-capacity transit, and it would allow us to put additional funding into existing transit to improve the service," Jason Ferbrache, ONE Transit's interim executive director, said. "The other 25% of the tax levy would actually go to the member cities for street maintenance and improvements."

Federal funding would be sought for approximately half of the rail "marquee project" with the remainder financed with bonds backed by sales tax revenue, he added.

ONE Transit at present is a development organization — the Central Oklahoma Transportation and Parking Authority, operating as EMBARK, runs city bus services in Oklahoma City, the 4.8 mile Oklahoma City Streetcar downtown, a seasonal Oklahoma River ferry, Oklahoma City public parking, and city bus services in Norman under an agreement with that city's government.

At present, regional transit amounts to four weekday round trip buses between Norman and Oklahoma City and one between Edmond and Oklahoma City.

Other Southwest transit agencies are also seeking to broaden mass transit options with the aid of new revenue sources and bond financing. 

"It's a questionable time to be expanding transit…because most transit agencies still haven't recovered from the pandemic, and many of them probably will not in terms of ridership," said Baruch Feigenbaum, senior managing director of transportation policy at Reason Foundation. "Typically, when you do capital projects for new service, you might be able to fund the construction of those, but you also have to fund the operations and maintenance, and oftentimes that is not taken fully into account."

As for federal transit funding, the Trump administration has "some political calculations that are taken into account when deciding which projects to fund," according to Feigenbaum, adding the Federal Transit Administration is looking to fund projects with the most local funding and support.

Mass transit funding and bond financing in Utah will increase in the future under bills passed by the legislature this year.

Starting in fiscal 2029, 5% of the incremental growth in state sales tax revenue above a fiscal 2028 baseline will be allocated to the state's Transit Transportation Investment Fund, which is projected to grow from $109.2 million in fiscal 2028 to nearly $200 million by fiscal 2035. 

The measure also created a transit commission effective July 1 to oversee the Salt Lake City-based Utah Transit Authority, including its bond issuance.

David Holt, Oklahoma City mayor
Oklahoma City Mayor David Holt says more public transit is needed to accommodate a population he predicted could reach 1 million by 2050 or 2055.
Bloomberg News

Another bill that became law taps the investment fund to help pay off up to $530 million of bonds for the FrontRunner commuter rail system.

UTA and the state's transportation department are working to expand FrontRunner service to accommodate population and economic growth along the Wasatch Front.

The Federal Transit Administration announced in August it anticipates committing $1.28 billion to the estimated $3.2 billion project, which will increase train availability, frequency, and capacity by at least 60% along an 82-mile, 16-station rail line between Ogden and  Provo and is expected to be completed in 2030 ahead of the 2034 Winter Olympics.

State Sen. Wayne Harper, who sponsored both bills, said the legislation will position UTA "to move forward and better serve growing Wasatch Front communities."

"Utah cannot build enough roads to meet its transportation needs," he said in a statement. "Transit must be reliable, timely, and responsive to every area UTA serves."

UTA, which currently gets 51% of its funding from sales taxes collected in a six-county area, had $2.148 billion of sales tax revenue bonds outstanding at the end of fiscal 2025.

In Texas, Austin's light rail Project Connect continues to slog through the state court system, which has been asked to validate an initial $150 million of bonds, while hearing challenges related to the project's property tax funding.

A May Texas Supreme Court ruling related to the bond validation case sent the matter back to Travis County District Court, where a judge last month rejected the state attorney general's dismissal request. That and other matters that dodged dismissal are currently before a state appeals court. 

The bonds would be paid off with a portion of Austin's maintenance and operations property taxes voters approved in November 2020 for what was then a $7.1 billion light rail project that was subsequently reduced in scope amid rising costs.

Despite ongoing court challenges, Austin Transit Partnership, a nonprofit corporation created by the city and its mass transit agency to oversee Project Connect's development and financing, is moving forward. So far this year, ATP has selected a company to provide light rail vehicles, a design-build contractor for an operations and maintenance facility, and a construction contractor for the system. It is also seeking federal funding.

Earlier this year, Moody's Ratings warned a significant reduction in broad-based political and public support for mass transit could lead to a negative outlook for the currently stable sector.

"The outcomes of 2026 ballot measures — such as the San Francisco Bay Area transit regional ballot measure, Oregon referendum to repeal state-approved transportation tax increases, and city-level initiatives in Texas to exit the Dallas Area Rapid Transit — will be important indicators of voter sentiment," the report said. 

DART faced a sales tax revenue hit this year with the potential exodus of as many as six of its 13 members with three subsequently placing measures to withdraw from the agency on the May 2 ballot and voters in only one — Highland Park — opting to end transit services and funding. 

In May, 83% of Oregon voters opted to repeal the tax hikes, while sales tax measures for transit in the Bay Area will be decided in the Nov. 3 election.


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