At today’s debate on conservative support for transit, developer Chris
Leinberger had a modest proposal for lawmakers who are desperately
seeking new transportation financing strategies in an era of diminishing gas tax returns: Ask real-estate developers to pay for projects that will increase their profits.
concept is often referred to by the wonkish term "value capture,"
evaluated by the University of Minnesota in a groundbreaking study last fall. But Leinberger, an active player
on land-use issues who founded the group Locus to help make urban
planners part of the federal transportation debate, kept his case
simple and accessible.
Many developers are willing to "share part of our financial
upside" to ensure continued local investment in transit and mixed-use
development, Leinberger said. "We in the private sector need to be at
the table because, a) we need these systems, and b) we have the
financial means to pay for it."
Leinberger’s approach, which
attracted vocal interest today from House transportation committee
chairman Jim Oberstar (D-MN), would not solve the problem of uneven
federal support for roads — which are funded through an 80-20 split
between Washington and local governments — and transit, which tends to
receive a lower 50-50 federal match.
"If we need to lower the
federal match, that’s fine," Leinberger said, as long as private-sector
buy-in could be counted as part of a locality’s contribution to transit.
despite value capture’s increasing presence in transportation financing
debates, it has a long way to go before members of Congress could
consider enshrining it in legislation. Increased property taxes are one
established method of requiring land owners to contribute to transit
construction, but cities such as Portland have attempted a largely
opposite approach by offering property-tax exemptions to developers who build up in walkable areas.