Healy Petitions PSC for Ruling on Milwaukee Streetcar Costs

MacIver News Service | October 5, 2011

[Madison, Wisc…] The president of the MacIver Institute on Wednesday petitioned the State’s Public Service Commission, seeking a definitive answer regarding who will have to pay for the costs of relocating utilities to make way for the construction of a 2-mile streetcar in the City of Milwaukee.

“The utility rate payers of Southeastern Wisconsin deserve to know whether or not they will be on the hook for costs associated with the construction of a two-mile train that serves a tiny fraction of citizens, businesses and tourists in a tiny fraction of the city of Milwaukee,” Healy said. “I am hopeful the PSC will provide these answers before work on the project begins.”

Healy wants to know who will be paying for infrastructure costs associated with construction of a proposed a 2-mile boutique trolley route. He has requested a declaratory judgment that the City of Milwaukee will be responsible for paying for the costs associated with moving utility facilities underneath the proposed Milwaukee Streetcar route. Healy is represented in the matter by Richard M. Esenberg and Thomas C. Kamenick of the Wisconsin Institute for Law & Liberty.

Last month, in their response to queries made by State Senators Van Wanggaard and Leah Vukmir, the PSC confirmed that utility-related costs associated with the Milwaukee streetcar project could exceed $70 million.

“Although these cost estimates are likely to change, it is imperative that the public and relevant officials know who will bear them.” Healy’s petition notes.

In his petition, Healy asserts that the City, and not the utilities’ ratepayers should pay for the costs.

“There is no “adequate health, safety or public welfare justification” to require the utilities to permanently move their facilities in order to accommodate the Milwaukee Streetcar line,” according to the petition “There is nothing about the existence or location of these facilities which threatens the public health, safety or welfare. The only reason that they have to be moved is construction of the Milwaukee Streetcar line.  This cannot constitute an “adequate health, safety or public welfare justification” as a matter of law. Such a justification must involve, at minimum, an exercise of the City’s police power. Building and operating a street car is not such an exercise.”


General construction of the $64.6 million, 2.1-mile rail line would be funded by $55 million in federal transit aid (previously allocated twenty years ago) and $9.7 million in tax-incremental financing district funds. Supporters assert that rider fares, downtown parking fees and advertising revenue will cover the $2.65 million annual operating cost.  The Milwaukee Common Council has approved the project although they have withheld the release of funding for the project pending additional information.

In their response to queries made by State Senators Van Wanggaard and Leah Vukmir, the PSC confirmed that additional, utility-related, costs associated with the project could exceed $70 million.

The PSC broke down the costs:

  • WEPCO  – $45 million
  • ATC .5 to 15.4 million
  • AT&T 10 million

The PSC said the ATC costs will vary depending on the need for corrosion protection for the steel conduit holding the underground transmission lines because of the proximity to DC (direct current) lines powering the proposed streetcars. The Commission further notes that the AT&T estimate is not for costs that would be incurred by other co-located telecommunication providers.

As the letter to Wanggaard and Vukmir states “Wiscosnin Stat. 227.41 allows the Commission to issue a declaratory ruling if a petition is filed by an interested person regarding whether a utility would be obligated to pay for moving its facilities associated with the Streetcar Project. Here, an affected utility or a ratepayer would request a declaratory ruling.”

Healy has filed the petition HEALYPETITION with the PSC requesting such a ruling as an individual utility ratepayer in Southeast Wisconsin, not on behalf of or in his role as President of the MacIver Institute.