Today the LA Streetcar released the findings from its economic impact report, and the results are excellent.  The study by AECOM projects the 4.75 mile streetcar loop will induce $1.1 billion in economic development to Downtown LA by 2035, including 2,100 permanent jobs, 2,600 new housing units, $24.5 million in annual spending, $1.9 million in annual city revenue, and 7,200 construction jobs (versus a baseline growth alternative).  The results are no surprise, judging by the tremendous economic benefits in Portland and Seattle.  What's most interesting about this study, however, is that it separates and directly quantifies the additional benefits that a streetcar will bring to Downtown LA—something that the Oakland Streetcar Plan could not do.  I highly recommend looking through the resources that the LA Streetcar has put together; they are the best out there.

In yet another blow to Oakland's struggling economy, the BayCitizen reports that Emeryville appears poised to lure a new Macy's store, albeit with some opposition.  Oakland already loses over $1 billion in retail sales to its suburbs annually, which translates to over $10 million in lost sales tax revenue and 10,000 lost jobs.  Oakland's solution to this retail leakage was supposed to be the Upper Broadway Specific Plan to create the East Bay's largest retail district just north of Downtown.  However, this project appears stalled, with no web updates posted since February even though the plan was supposed to be completed by late Fall 2010.  Macy's was supposed to be one of the major retail anchors for the district, along with Target, JCPenney, and others. 

The success of Oakland's economy, as well as the effectiveness of its city government, rests upon its ability to reduce its retail sales and job losses to its suburbs.  Oakland must increase its sales tax revenue to help prevent further budget crises and cuts to schools, police, and city services.  The Oakland Streetcar would be a much-needed catalyst to bring the Upper Broadway Retail District into fruition.

UPDATE 2/8/2011: For an excellent, detailed analysis of the specific economic benefits derived from a streetcar, see the Los Angeles Streetcar's economic impact study.

With dozens of cities as diverse as Los Angeles, Washington D.C., Dallas, Atlanta, and Cincinnati pursuing streetcars as engines of economic revitalization and smart growth, the 2010s could (once again) be the decade of streetcars in America.  The impetus for America’s renewed interest in streetcars lies in the overwhelming success of the Portland and Seattle Streetcars in serving as development-oriented transit.  This short essay will synthesize the quantitative results of the streetcars in stimulating new development, generating new jobs, and creating new retail destinations.

Streetcars serve as a powerful marketing tool for stimulating development and revitalizing previously economically-depressed neighborhoods.  Unlike buses, streetcars have had a measurable impact on property values due to their permanence, connectivity, and marketability.  In Portland, property values have increased ten-fold in many previously depressed areas along the line as properties along the streetcar become more desirable to build upon.[i]  Because of this significant financial return, property owners in Portland paid 25% of the costs of constructing the Portland Streetcar, while property owners in Seattle paid 50% of total capital costs.[ii],[iii]