Yonah Freemark has this article in the Next American City about the role of transit in encouraging economic development:
By building new transit lines that hit areas that can be redeveloped and places that are inhabited by low-income, transit-dependent people, cities can develop systems that fulfill both needs.
Cincinnati’s streetcar, which received funding from the local city council this week, is an example of how this can be done. The line, which is planned for operations in 2012, will run from the city’s riverfront to the zoo, via downtown and the University of Cincinnati. At the river, it will encourage the further growth of a huge redevelopment scheme called The Banks; downtown, it will run past dozens of vacant or under-used blocks primed for investment; passing through the Over the Rhine neighborhood, it will serve a number of low-income inhabitants; at the University of Cincinnati, it will hit a highly transit-dependent population.
This approach gives municipalities greater control over where to promote higher-density growth. Though this may benefit certain developers owning land in the right places, it ensures public involvement in determining where to place new transit lines and the buildings that will follow them, rather than passing that power—and federal dollars—over to the private sector.
By taking the reins of the streetcar’s development, the city has ensured that it serves some of the area’s most transit-needy. But by directing the system’s route towards major private development sites as well, the streetcar will provide a number of opportunities for more of the urban growth so in demand today.