Dallas city leaders voted to push forward a long-discussed streetcar expansion connecting the Oak Cliff and downtown line to the Uptown M-Line trolley, even as at least one council member warned that the price tag for running the existing system is already unsustainable. The council approved a $1 million agreement with engineering firm AECOM on Wednesday to finalize the route, a step that comes even though the streetcar's day-to-day operating costs have been climbing for years.
According to the Dallas Observer, the completed route would eventually link the Bishop Arts District, Klyde Warren Park, the Dallas World Aquarium, West Village and additional downtown stops, building on a connector route that was generally supported back in 2017. City Transportation and Public Works Director Gus Khankarli said finalizing the alignment will still require stakeholder and public engagement before anything is locked in, per the same outlet's reporting. The broader concept of linking the Oak Cliff streetcar to the McKinney Avenue Transit Authority's trolley line has been under study for months, as The Dallas Morning News has reported, with the city council having already settled on Elm and Commerce streets as the connecting routes back on Sept. 13, 2017, in a $92 million decision.
A System Already Straining Its Budget
The timing has drawn scrutiny because the streetcar's existing finances are shaky. Dallas Observer reports the current streetcar operating budget sits close to $2.8 million, with the city's general fund covering an estimated $2.5 million of that and DART sales-tax returns covering roughly $300,000 more. Council member Cara Mendelsohn criticized the arrangement as a poor deal for Dallas, telling the outlet that ridership is declining while costs have escalated dramatically from the roughly $1 million price tag she recalls from when she first joined the council.
Khankarli, for his part, attributed the rising costs to drying-up subsidies and inflation driving up spare-parts and operating expenses, the Observer reported. DART's proposed FY 2026 budget lists streetcar operating expenses of $2.95 million for FY 2025 and $3.01 million for FY 2026, about a 2% increase.
Ridership Slips
Streetcar ridership numbers add another wrinkle. DART's own first-quarter data show rides falling from 140,200 in FY 2025's first quarter to just 99,800 in the same period for FY 2026, according to the agency's FY 2026 first-quarter ridership and performance presentation. DART's financial standards explicitly prioritize keeping existing assets in a state of good repair over funding expansion.
The Dallas streetcar currently charges $1 per rider, the Observer reports. Dallas is set to receive more than $21 million in DART sales-tax returns in 2026 alone, part of a six-year, $211 million arrangement approved last spring as a compromise with member cities to avert exit elections, according to the same report. That money arrives as the city's general fund has faced its own pressures — a $51 million shortfall required service and department cuts in September, per the Observer's reporting.
Council Members Push Back on Priorities
Not every council member is on board with expanding before fixing the funding math. Council member Jesse Moreno said the city must reduce the streetcar's burden on a budget already squeezed by consecutive years of cuts, rising costs and declining revenue, and he argued expansion shouldn't move forward without dedicated maintenance and operating funding secured first, the Observer reported. Council member Bill Roth suggested the city examine less costly streetcar alternatives altogether, especially with the Kay Bailey Hutchison Convention Center undergoing a $3.8 billion expansion that will reshape downtown traffic patterns for years.
City officials say they're working on it. Khankarli said he expects to discuss potential streetcar contributions with DART leadership soon and is trying to expedite a council presentation focused on minimizing future general fund contributions, according to the Observer. The city is conducting a study of potential funding sources — including parking fees, advertising and sales-tax contributions, plus previously floated ideas like naming rights and property-tax assessments reported by The Dallas Morning News — aimed at stabilizing or reducing the general fund's exposure. That funding study is expected to wrap in the first quarter of 2027.
History Looms Over the Latest Push
This isn't the first time Dallas has wrestled with the streetcar's finances against the backdrop of bigger transit fights. DART removed its long-planned D2 subway project from its long-term plans in 2023, years after the Dallas City Council passed a 2022 resolution stating DART would discuss increased streetcar contributions if D2 were deferred. The original Oak Cliff-to-downtown streetcar line opened in April 2015, built in part with a $23 million federal TIGER grant, the Morning News noted in its commentary on the latest connection push.
Beyond the Uptown link, city planners have floated even more ambitious additions, including potential stops in Lower Greenville and Fair Park, per the Observer. A separate Hoodline report detailed a concept route that would run south from the downtown convention center along Botham Jean Boulevard before swinging east on Martin Luther King Jr. Boulevard into Fair Park, though that proposal remains in an early, high-level planning phase requiring further study, design and financing. City staff have floated a rough infrastructure estimate of roughly $10 million to $15 million per mile for that corridor, and officials are running a fatal-flaw evaluation on the alignment alongside a separate downtown-connection study funded through a HUD grant.
