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Federal agency threatens to pull back $37M in funds if Loop Trolley isn't in operation by June

The $52 million, 2.2-mile trolley debuted in November 2018, offering service from Delmar Boulevard entertainment district to Forest Park.

ST. LOUIS — The Federal Transit Administration on Monday threatened a clawback of more than $37 million in grants used to fund the idled Delmar Loop streetcar system unless local authorities in the next two months can present a plan that restarts the trolley by June 1.

In a letter to St. Louis Mayor Tishaura Jones, Mokhtee Ahmad, the FTA's regional administrator, said the Loop Trolley Transportation Development District by Feb. 1 must submit a plan that resumes trolley service for at least four days a week, using three vehicles. If it fails to do so, the FTA may seek to recover the $37.45 million in funding it awarded to the project between 2011 and 2015. Jones is chair of the Loop Trolley TDD, which collects a 1% sales tax in the Loop.

The threat won't come as a surprise to Jones, St. Louis County Executive Sam Page, or regional leaders who, for months, have warned of wide-ranging implications should they fail to restart the dormant trolley system.

"In the letter, the FTA reemphasizes what Mayor Jones and County Executive Page have warned our region about over and over again; failure to fix the Loop Trolley problem will result in a federal clawback of tens of millions of dollars while imperiling our entire region’s ability to receive federal grants in the future — including from the Bipartisan Infrastructure Plan," Nick Dunne, a spokesman for Jones, said in a statement Monday.

The $52 million, 2.2-mile trolley debuted in November 2018, offering service from Delmar Boulevard entertainment district to Forest Park. But it fell far short of expectations and within less than a year in service, its operators were seeking additional funds to avoid insolvency.  

Read the full story on the St. Louis Business Journal website.