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Can Southwest light rail overcome a lawsuit and the Republican blockade?

Two lawsuits and tens of millions of dollars in operating costs still stand in the way of the $2 billion line between Minneapolis and Eden Prairie.

Two lawsuits and tens of millions of dollars in operating costs still stand in the way of the $2 billion line between Minneapolis and Eden Prairie.

All's quiet along the Kenilworth Corridor, save for a posse of squawking black birds in a leafless oak tree.

A similar atmosphere hangs over Southwest Light Rail Transit, the $2 billion, 14.5-mile line that's penciled in to slice through this area between Lake of the Isles and Cedar Lake starting circa 2021. But the calm is unsustainable. The fate of the project is anything but certain.

Unresolved legal challenges pose the greatest threat to derailing it. Uncertain funding also clouds the narrative about what would be the most expensive public works undertaking in Minnesota history.  

Catastrophe averted was the theme just 12 weeks ago. With the threat of losing $900 million in federal funding that would go toward construction costs, Gov. Mark Dayton saved the project. For months, Minnesota's DFL chief exec implored GOP lawmakers in the Legislature to approve $135 million in necessary state funding.

Bugger off, House Speaker Kurt Daudt (R-Crown) repeatedly said. But Dayton outmaneuvered the partisan misers, convincing the Met Council, Counties Transit Improvement Board, and Hennepin County to agree to cover the funding gap. 

"I'm still not entirely clear on how they pulled it off, but the governor's roundabout appears to have worked," Rep. Nick Zerwas (R-Elk River) says. "My question is how can the Met Council go about doing this by itself, without the Legislature behind it, when they're still going to have to need state money to cover the operating costs? I mean operating losses."

They'll have one last swing. It'll come during 2017's legislative session. If backers still can't convince lawmakers to approve funding, the local entities, largely made up of political appointees, not elected officials, will be relegated to finance the funding gap via issuance of certificates of participation.

The certificates are much like bonds, except with higher interest rates of about 3.25 percent.

Also resigned in stopping the project is Rep. John Petersburg (R-Waseca), vice chair of the House transportation committee. As Petersburg asks, who's going to pay to operate the line once it's built?

"After the monies from fare boxes and whatever other funding sources you have, the state is responsible for 50 percent of the remaining operations," he says. "My understanding is that both buses and trains operate at a 65 to 75 percent loss. I would like to know if they're already committing extra dollars to building it, where's the additional funding going to come from to keep it going? There's only so much money to go around. To me, it seems like poor planning."     

According to Met Council spokesperson Kate Brickman, the Counties Improvement Transit Board will shoulder the other 50 percent for operations. She didn't say what would happen if revenues from motor vehicle fees and a quarter of a percent Twin Cities area transit tax were exhausted.      

Still, the greatest threat to Southwest LRT isn't potential deficits. It's the Lakes and Parks Alliance's pending lawsuit.  

The case, which is scheduled for trial on September 17, 2017, charges the Met Council with shirking the National Environmental Protection Act. The Alliance alleges that the Council chose to route the line through the sensitive Kenilworth Corridor, without analyzing less environmentally delicate alternatives.

The plaintiffs would appear to have a sympathetic audience in U.S. District Court Judge John Tunheim.

In green-lighting the case in August 2015, Tunheim wrote, "[The public record] shows that, throughout much of this process, the Met Council has had a clear favorite route for the SWLRT. While the agency in charge can state a subjective preference… the significant drumbeat of support the Met Council assembled for a single route, certainly comes close to having the practical effect of limiting the available options, such that the remaining federal environmental review is meaningless."

The suit is already causing the Met Council problems. According to past media reports, Council Chair Adam Duininck admitted to Governor Dayton in a letter that the Federal Transportation Administration has delayed signing off on the final funding agreement because of the LPA lawsuit.

Brickman disputes this, saying, "The FTA is not withholding federal funding until the LPA litigation is heard. We expect to receive the Full Funding Grant Agreement next summer."  

If LPA should ultimately prevail in court, it could well prove a fatal blow. That decision would set the project back years and tens of millions of dollars by forcing the Council to conduct environmental impact studies on alternatives to the Kenilworth route.

It all adds up to a project that should have been junked long ago, according to Rep. Petersburg.

"I think when people see what kind of environmental damages this will bring, they're going to have real trouble supporting it," he says. "Even more concerning is the way this has happened. It's as if the people of Minnesota are being bullied into doing it whether it's only a small group that wants it."