City-subsidized nightlife trolleys trail expectations

Kansas City’s weekend entertainment trolleys, which began running nearly two years ago, are lagging in projected ridership and in paying back a city loan.

But the program’s operators still consider it a success and say the city will get its money back as promised.

Kansas City provided a $200,000 no-interest loan in October 2009 to jumpstart the KC Strip, a trolley service that runs from Waldo to River Market on Friday and Saturday nights. The trolleys started operating in spring 2010, and the loan was to be paid back in monthly installments, beginning in May 2011, with the city receiving $50,000 annually over four years.

Operators had projected that the money would come from about 50,000 passengers per year, from a $1 ticket surcharge per passenger. They had hoped for nightly ridership of close to 500 people.

However, ridership has been closer to 500 a weekend than a night. The city has received only $18,332 in the first 10 payments, and annual ridership will likely be under 25,000.

“When we started this, it had never been done before, so we made an estimate,” said Bill George, chief executive of the Kansas City Transportation Group, which provides the five trolleys and five shuttle buses that run every Friday and Saturday from 7 p.m. to 3 a.m. “But there’s a protection in there for the city.”

George explained that the city gets its monthly payments based on actual ridership. But if at the end of the first 12 months those payments haven’t reached $50,000, his company will make a catch-up payment. It will do so each year until the loan is paid off.

The city acted as an incubator to help the service get off the ground, George said.

“Their payments have always been secured,” he said. “And it’s a great addition to the city.”

Oscar McGaskey, director of Kansas City’s convention and entertainment facilities, agreed.

“It’s been good for the city to have that type of asset, taking people to different destinations,” said McGaskey, who oversees the loan repayments. “As long as we’re paid back and as long as it’s providing a service, it’s a good thing.”

In addition to the loan, the trolley has received $220,000 in various city tourism grants since 2009.

George says that for that investment, the city got a transit service that takes customers to bars and restaurants in Waldo, Brookside, the Plaza, Westport, Martini Corner (31st and Oak streets), 18th and Vine, the Crossroads and downtown.

People pay $10 for unlimited stops along the route. Saturdays have been twice as busy as Friday nights. Almost half the riders come from outside Kansas City, with most of those from Johnson County.

Interestingly, ridership is lower this winter than last, even though last winter’s weather was much worse.

“We get more people when it’s nasty outside because they don’t want to drive,” George said.

Some bar owners said it’s made a positive difference. They see the influx of patrons spill into their businesses when a trolley pulls up.

“We have more traffic as a result of the Strip,” said Vince Rook, owner of the Velvet Dog, 400 E. 31st St.

Despite this winter’s disappointing numbers, George said the trolleys served more than 1,300 people on New Year’s Eve. The service is in negotiations to expand this spring to Zona Rosa in the Northland. It may also add extra nights when Kansas City hosts baseball’s All-Star Game events in early July.

George and Westport entrepreneur Bill Nigro, who greets passengers and helps coordinate the drivers every weekend, are committed to keeping it going.

“We’re extremely pleased with it,” George said.

This story was originally published February 19, 2012 at 5:00 AM with the headline "City-subsidized nightlife trolleys trail expectations."