Orange County’s $649 million Trolley to Nowhere
California’s bullet-train may be the state’s most high-profile transportation money-sink, consuming a projected $135 billion with no clear path to the finish line. However, taxpayers shouldn’t overlook the other transit boondoggles torching public funds. Chief among them is Orange County’s 4.15-mile OC Streetcar: proof that you can pour high-speed-rail-style money into a monument to tunnel vision.
The streetcar line from Santa Ana to Garden Grove was sold as a transformative link to connect neighborhoods, employment hubs, and transit centers. Yet as the project moves toward its delayed 2026 opening, its ballooning costs, questionable utility, and adverse impact on local businesses make it a case study in bureaucratic mismanagement and fiscal irresponsibility.
Last month, the 2024-25 Orange County Grand Jury report released its scathing assessment of the OC Streetcar project’s operational and financial mismanagement. Initially projected to cost $250 million in 2015, the project cost has now reached $649 million, a 2.6-fold increase that could climb even further. That’s a staggering $156 million per mile, almost twice the cost of the next highest streetcar project: the (Washington) DC Streetcar at $83 million.
Because the OC Streetcar was funded partly by Orange County’s Measure M2 (OC Go) half-cent sales tax, it placed an extra burden on local taxpayers. And every future overrun will be 100 percent funded by local money. The Grand Jury report warns that the Measure M fund is already overextended with its project list adding up to 104.5 percent of revenue allocations.
And while Covid-19 has been a convenient excuse, the report is highly critical of Orange County Transportation Authority’s (OCTA) failure to anticipate issues like contaminated soil, Native American remains, and aging utilities that have contributed to delays and cost overruns.
OCTA’s pre-Covid projections of 6,000 to 7,500 daily streetcar riders, already modest for a $649 million investment, now seem highly optimistic. Santa Ana, the streetcar’s primary service area, has seen its population decline over the past decade — from 326,626 in 2015 to 315,325 in 2025. Further, Metrolink, the regional rail system that the streetcar is designed to complement, has itself seen a significant decline in ridership. The combined average weekday ridership on the Orange County Line and Inland-Empire Orange County Line has fallen over 50 percent from pre-Covid levels of 14,892 in Q2 of 2019-20 to just 7,121 in Q2 of 2024-25. This massive decline in rail usage undermines the project’s foundational assumptions.
Even at its peak projected ridership of 7,500 daily passengers, the streetcar would drive a mere 0.015% reduction in Orange County’s annual vehicle miles traveled. At full build-out: ten stations stretched across 4.15 miles, the streetcar will carry about as many people per day as a single arterial bus line in neighboring Los Angeles County. As the Grand Jury report rightly states: “this is an extraordinary amount of money for a project that will serve a tiny fraction (less than ¼ of 1%) of the 3.2 million Orange County residents.”
The streetcar’s impact on Santa Ana’s downtown businesses has been catastrophic. The Grand Jury’s report describes the construction as “devastating,” with “confusing street closures” and a “hopscotch method” of road work that has choked off access to the commercial corridor. Santa Ana’s city council was forced to allocate $1.5 million in 2022 to bail out struggling merchants, a cost ultimately borne by local taxpayers.
OCTA’s broader financial picture doesn’t inspire much confidence either. The agency’s last two budgets have had to rely on an annual draw-down of $300-350 million of accumulated reserves.
OCTA may tout the streetcar as a “zero-emission transit option,” but its environmental benefits are negligible compared to its costs, and its impact on congestion will be minimal — if it’s felt at all.
As the streetcar’s opening looms in spring 2026, Orange County taxpayers are left holding the bag for a project that’s over budget, behind schedule, and out of touch with reality.
Athan Joshi is a visiting research assistant for California Policy Center’s summer 2025 term.