A Decision-support Framework for Using Value Capture to Fund Public Transit: Lessons from Project-specific Analyses
economics - value capture, economics - benefits, land use - impacts, place - north america
Land value capture, Joint development, Impact fees, Tax increment financing; Special assessment districts
Local and state governments provide 75 percent of transit funds in the United States. With all levels of governments under significant fiscal stress, any new transit funding mechanism is welcome. Value capture (VC) is one such mechanism. Based on the “benefits received” principle, VC involves the identification and capture of public infrastructure-led increase in land value. While the literature has extensively demonstrated the property-value impacts of transit investments and has empirically simulated the potential magnitude of VC revenues for financing transit facilities, very little research has examined the suitability of VC mechanisms for specific transit projects. This report aims to fill this research gap by examining five VC mechanisms in depth: tax-increment financing (TIF), special assessment districts (SADs), transit impact fees, joint developments, and air rights. The report is intended to assist practitioners in gauging the legal, financial, and administrative suitability of VC mechanisms for meeting project-specific funding requirements.
Permission to publish the abstract and link to the report has been given by Mineta Transportation Institute, copyright remains with them.
Mathur, S., & Smith, A. (2012). A Decision-support Framework for Using Value Capture to Fund Public Transit: Lessons from Project-specific Analyses. Report No. MTI 11-14, published by Mineta Transportation Institute, 216pp.