Triangle Regional Transit

[monsoon]

^Actually local governments are not so willing to use TIFs to fund transit, because there is considerable risk in assuming that development will be generated along these transit lines. If it fails to materialize in the amounts that are projected, the local governments are left with having to raise property taxes to pay for these considerable expenses. It's an especially difficult sell now that we are in an America where real estate prices are actually falling.

Case in point, TIFs have been proposed to build the North CR line that will connect Charlotte to Lake Norman. One of the city councils on that line, Huntersville, has pretty much said they will not sign up for a TIF to help fund the line as it poses a considerable risk to the finances of the city. Most likely the other towns are going to follow suit.

[Jones_]

I had assumed that using TIFF for transit meant building the developments first, then using the revenue to build out the transit, but its really the other way? Not only would the actuaries have to assume new TIFF-able development would come after the line is built but they would have to assume it would be a certain size, or valued at a certain amount anyway. Hmm. I probably have not read enough of the previous posts so apologize for all I am not getting.

[monsoon]

^It is the other way around.

TIFFs that have been proposed to build transit operate like this. Municipality borrows the money to build the transit system. The money is paid back by using the additional property tax revenue that is generated by the new development that is projected to occur from having built the transit line. In theory it sounds good, but if that development does not get built then the new property tax revenue is not there, but the debt still exists. What happens then is the municipality has to pay back the debt out of general revenues. NC gives the city and county governments very few options for this so it most likely means a property tax increase.

This is why when asked to sign up for TIFF funding for transit, and given this is uncharted territory in NC and considered risky, there are not going to be many cities and county governments willing to take on that risk. The problem is the rosy projections of developers and transit planners come with no guarantees.

[orulz]

Sometimes, though not always, you can very easily "predict" the increase in tax revenue from development, when at least some of the development is already proposed before construction of the TIF's infrastructure begins. This might apply to Bryton, etc in Charlotte. Construction of the infrastructure is made conditional on the construction of the development, and the development's construction is made conditional on the construction of the transit line.

[monsoon]

^In Bryton's case that was true. However you can't do that with a transit line. There is no way to make any of it conditional. The government either borrows the money to build it, or it doesn't get built.

[urbanvb]

Thinking about TIFFS (this is a bit off topic) but as in CLT's case has the property near the rail line noticably increased in value (yet) ?

[ncwebguy]

This may be off topic, but the potetntial TTA transit network's biggest stumbling block to this point seems to have been financing.

Why can't TIFs be *a* source of funding, not *the* source? For TTA, the rental car tax and vehicle registration fees aren't going away, but won't be the be all-end all. Some kind of property and or sales tax will be needed to raise funds. The TIF would be another stream, based on a "zone" of property near stations.

There would be a baseline valuation on all property near the stations. Projects ready to go at the start of rail line construction (Cherokee as master planner for TTA's land, combined with other partners willing to build once the line gets under construction) would be used as a baseline for the TIF. This, in addition to "TIFing" existing developments -- baseline or below? all taxes go to general obligations; above baseline? taxes above go specifically to transit.

This TIF baselilne (small source that gets bigger as transit gains ridership) + ongoing rental car tax/registration fees (medium source) + city/county (wake, durham, orange, maybe johnston, fraklin, chatam) property tax ($.01 per $100) and sales tax ($.0025) (largeish sources that declines when possible) + state funding (smallish) + federal funding (small to nothing) = total cost of money borrowed for the initial line.

The taxes generated by increased valuations could work as seed capital for other pieces of the transit network once bonds for the initial line is paid off. The obligation of the property taxes from the rest of the counties not in the TIF zones would go down accordingly.

So property taxes would be higher to start with and go down in the event of a (likely) windfall, as opposed to an initial raise followed by a secondary raise to cover a potential shortfall.

It sounds like the land from QueensPark going south has its best days ahead of it. Land values along the line between QP and CTC had risen before rail construction started, and has continued to rise since (I belive). I haven't seen any "property values decrease as the rail's grand opening approaches" stories, but I may have missed them.

[Jones_]

Then, as Urbanvb made obvious to me finally, always at least in the beginning, there is only a small TIFF revenue stream which grows over time. Well, how is teh repayment structured? Even if it was interest only in the beginning the TIFF stream would not cover it.....so there is a general fund or other source needs tapped regardless. It seems that at best, TIFF's can only replace a more predictable revenue stream?? I am getting this correctly?

Edit: ^ webguy posted teh same time I did, also pointing out this detail. Again, I have not read enough in this thread, but it seems like an overlooked but important point...TIFF, by their nature, cannot be primary initial funding sources.

[RiverwoodCLT]

To make transit work you must have locations with high number of workers. I have read that 100,000 people in a location are an ideal numbers for transit to work well. Charlotte has approx. 65,000 people working uptown. With new construction of office space now, this add about 8,000 workers. That would put uptown up to approximately 73,000 workers. Uptown Charlotte is small compared to the RTP. When you get off the South Blue line you can walk to work places with out much trouble. Charlotte is looking to go from Nearly 12,000 residents to 27,000 residents by 2012. The South Blue Line is all inside the city of Charlotte and serves neighborhoods along the 9.6 miles.

Charlotte is on the low end for employment compared cities like Denver, Houston and Dallas which have LRT systems.

From the Raleigh Downtown Report

Projected Employment 2005 - 31,158

Projected Employment 2025 - 38,183

The population of the Central Planning District is expected to expand today population of 3,366 to 11,200 in 2025.

These numbers will make it hard for Raleigh to support enough riders if they were going to the triangle or people coming to downtown to work. From what I have heard from people who live in north Raleigh, they would not drive downtown to catch a train to the triangle. The Research Triangle is the biggest employer in the Triangle with workers coming from all over the region. You would need a lot of feeder buses to get the people to the line and when you get to the RTP you would have to transfer to another bus to get to work. I do not think too many people would want to do this. A better bus system with bus only lanes to the triangle would work better and service the northern neighborhoods in north Raleigh.

Raleigh may want to start an in city transit LRT & trolley system and maybe a line to the airport area.

[ChiefJoJo]

To make transit work you must have locations with high number of workers. I have read that 100,000 people in a location are an ideal numbers for transit to work well. Charlotte has approx. 65,000 people working uptown. With new construction of office space now, this add about 8,000 workers. That would put uptown up to approximately 73,000 workers. Uptown Charlotte is small compared to the RTP. When you get off the South Blue line you can walk to work places with out much trouble. Charlotte is looking to go from Nearly 12,000 residents to 27,000 residents by 2012. The South Blue Line is all inside the city of Charlotte and serves neighborhoods along the 9.6 miles.

Charlotte is on the low end for employment compared cities like Denver, Houston and Dallas which have LRT systems.

From the Raleigh Downtown Report

Projected Employment 2005 - 31,158

Projected Employment 2025 - 38,183

The population of the Central Planning District is expected to expand today population of 3,366 to 11,200 in 2025.

These numbers will make it hard for Raleigh to support enough riders if they were going to the triangle or people coming to downtown to work. From what I have heard from people who live in north Raleigh, they would not drive downtown to catch a train to the triangle. The Research Triangle is the biggest employer in the Triangle with workers coming from all over the region. You would need a lot of feeder buses to get the people to the line and when you get to the RTP you would have to transfer to another bus to get to work. I do not think too many people would want to do this. A better bus system with bus only lanes to the triangle would work better and service the northern neighborhoods in north Raleigh.

Raleigh may want to start an in city transit LRT & trolley system and maybe a line to the airport area.

[monsoon]

Keep in mind that cities and counties in NC generally can't create new taxes unless they get approval from the NC Legislature. However, I believe they are free at anytime to place a 1% sales tax on the ballot that can be voted in by the citizens that could be used for this purpose. There are a specific set of statutes that govern how it works, but it was a modification of this which allowed Mecklenburg to get it's 1/2 cent tax. It also provides the mechanism for people to place a repeal measure on the ballot.

My guess is this is the only approach that is going to general sufficient funding amounts to move the TTA rail projects forward. I think any plan that is suggested that relies on TIFFs is one that probably isn't going to get off the ground.

[RiverwoodCLT]

I thought the numbers were too low, but that what was on the report I saw. If you had all the 105,000 workers in one location, I think you would have a rail system by now.

[ChiefJoJo]

Keep in mind that cities and counties in NC generally can't create new taxes unless they get approval from the NC Legislature. However, I believe they are free at anytime to place a 1% sales tax on the ballot that can be voted in by the citizens that could be used for this purpose. There are a specific set of statutes that govern how it works, but it was a modification of this which allowed Mecklenburg to get it's 1/2 cent tax. It also provides the mechanism for people to place a repeal measure on the ballot.

My guess is this is the only approach that is going to general sufficient funding amounts to move the TTA rail projects forward. I think any plan that is suggested that relies on TIFFs is one that probably isn't going to get off the ground.

[JDC]

^Indeed on the federal tightening up. The Blue Line in Charlotte would not have been approved for federal funding under the rules that exist now. I am not optimistic this is going to change anytime soon, even with a change in administration, because of the massive debt the government has run up in the last 6-7 years.

[monsoon]

^I don't think that changes anything I have said. The federal government is spending money at unsustainable levels and unless there are huge cutbacks and/or tax increases, there isn't going to be more money for transit projects no matter what campaign promises are made. When a politician such as that makes such suggestions what should be asked next is where are you going to get the money to pay for it? I am not saying it shouldn't be done, but the reality of the situation is the Federal government is not going the be the source for significant transit funding for quite some time.

Any project that does get approved is going to have to have a significant local funding component before it has any hopes of getting off the ground. Until that problem is solved then attempts of getting the money out of the federal government are pretty much wishful thinking. This is especially true in a state where the two senators are not exactly fans of transit.

[vitaviatic]

I tend to agree with you on the ridership thing, although I have to make a few comments, since it is an area that I am familiar with... "Sentinels" (IIRC as you put it ) like PB have become the gateway to New Starts, rightly or wrongly, because they know how the FTA wants models done, which is to say there are strict standards for these projections. There are some amazingly sophisticated $multi-million models out there that are more behavior or simulation-based, but most areas are not to the level where it makes sense to them... ie, the tremendous expense isn't worth the additional accuracy, especially for projecting alternate modes or HOVs, etc.

Unfortunately, our current admin in Washington has clamped down on funding, so that forced the FTA's hand in trying to weed out undeserving, or not quite cream-of-the-crop projects to fit it's meager $1.4B annual New Starts budget. This is where TTA got queezed. The best thing many transitional metro areas such as the Triangle, Birmingham, Tampa, etc, can hope for is for the next Administration in DC to be pro-transit, and drastically increase federal funding for these projects. Maybe TTA/NCRR can get the basic AM/PM starter service going (on existing tracks) and then in a couple of years re-apply for FTA-grant funds to really get things going.

[orulz]

...

Having said that, my argument all along has been that, nothing will get you into the saddle quicker than a basic "starter" service, that gets rated entirely differently than a modeled-out, but still imaginary operation. And since the squeeze is on, IMHO, expenditures toward this kind of thing are so diminshed in returns that it is too ridiculous to even consider. Federal funding is basically the heroin of the transit industry. Every agency that got in under the old rules will begin to cough blood when the real squeeze hits down the road. Perhaps TTA received a blessing in disguise when they got rejected.

I still believe that you can get a workable operation off the ground on a shoestring, given the status off the rail (state-controlled), the pre-existence of passenger service (NCDOT/Amtrak), and the basic infrastructure in place (stations at DTD, DTR, Cary). It might not be everything you want it to be right off the bat, but everything evolves. Imagine all the money that has been spent in sheer futility to date, to impress the FTA. You could have already had a couple of trainsets going. Not only that, I believe that just with the state money that was earmarked for TTA would have been sufficient to at least get the trackwork done. Now, TTA versus HSR is a different matter to be solved, but nothing says that a stopgap operation can't be placed in the meantime.

[JDC]

^I don't think that changes anything I have said. The federal government is spending money at unsustainable levels and unless there are huge cutbacks and/or tax increases, there isn't going to be more money for transit projects no matter what campaign promises are made. When a politician such as that makes such suggestions what should be asked next is where are you going to get the money to pay for it? I am not saying it shouldn't be done, but the reality of the situation is the Federal government is not going the be the source for significant transit funding for quite some time.

[orulz]

A group from Hillsborough had a meeting with the NCRR about the Goldsboro-to-Greensboro commuter train study yesterday. There is an article in the Herald-Sun? and News&Observer.

In short, the people in Hillsborough want a stop on that line.

[vitaviatic]

It depends on how "basic" your starter system is. Nashville built a line on the ultra-cheap but it has completely failed to meet expectations. They had a shoestring budget and tried to make something, anything, that actually carries revenue passengers, in the hopes that it would convince people that a system is needed and more money (local and federal) would follow. They succeeded at building their line, but that line has failed consistently to meet ridership projections, and they've suffered a loss of credibility with the public that may set them back by a few years on any attempts to build a more comprehensive rail system.

Taking the NCRR between Durham and Raleigh, and adding two more stations (say RTP and NCSU) is similar to what Nashville has done - the target market is just too narrow, and the project would probably be doomed to failure...

I wonder if we could build something very similar to TTA's plan, only rather than making it a separate railroad not connected to the mainline, we would add a similar amount of capacity to the NCRR main line (resulting in a 3-4 track mixed traffic main line between Raleigh and Durham similar in concept to the Northeast Corridor.) Modify the signals & install crossovers to allow for shorter peak headways. Don't restrict through freight trains, but move locals serving on-line industries to off hours only. This would require NS's permission of course, which might not be easy to get, but it would eliminate the need for several expensive flyovers and the hugely expensive below-grade setup in downtown Raleigh, and significantly decrease the amount of right-of-way and grading that would be needed. In addition, the money to build it could come from several different pots: NCRR, NS, TTA (or whatever agency), and SEHSR, since all of them would benefit from an improved NCRR mailnine.

[Creasy336]

A group from Hillsborough had a meeting with the NCRR about the Goldsboro-to-Greensboro commuter train study yesterday. There is an article in the Herald-Sun? and News&Observer.

In short, the people in Hillsborough want a stop on that line.

[vitaviatic]

Essentially it would be a location-based property tax hike in either a lump sum payment or recurring payments with a sunset date--similar to a Business Improvement District (BID) or HOA surcharge. Raising the tax from these TOD areas makes logical sense since they are the primary beneficiaries of the service, but you do it with out the risk and uncertainty of a TIF. Raise the tax, but only on a select few areas and not for the city at large... that's a win-win scenario as far as I'm concerned. I happen to live within the logical boundaries of one of these zones (see below), and I would gladly pay an additional few thousand dollars to fund a transit line nearby. I suspect others, if properly educated on the costs & benefits, would do so as well.

[uptownliving]

I think these type of "BID" districts are a potentially good way to fund the capital costs of a TTA Rail system...but where would the operating funds come from? Would the Rental Car Tax in place now be enough to fund the yearly costs of operating the system?

[ChiefJoJo]

I thought this was noteworthy:

Public Policy Polling: Triangle citizens support new transit funding.

According to the survey company, Orange County citizens were most supportive of transit funding, followed by Durham County residents, and then Wake County ones.

"The results of our poll show that voters in the Triangle are willing to be taxed more to fund large scale mass transit projects," explained Dean Debnam, President of Public Policy Polling.

When asked an up or down question on whether they would support a half cent sales tax for transit like the one in Charlotte, PPP said that residents of all three counties were supportive.

In Orange County 68% of those who responded to the poll said "yes" while 23% said "no."

In Durham County, 55% of those who responded to the poll said "yes" while 40% said "no".

In Wake County, only 52% of those who responded said "yes" while 38% said "no."

The full poll results are linked here.

The STAC has some more details to work out, but I am thinking that it is possible that we could see a ballot initiative in the fall of 2008 to support some kind of mass transit tax. One would think that with business community (chambers, RTP, etc) financial support, these early polling numbers show we could get it done.

[orulz]

Saw this in the minutes of the November agenda for the TTA Board of Trustees. This is from the General Manager, David King's, report to the board.

A synopsis of the STAC process and some of the discussion/thoughts being

generated: The Phase I regional rail project is seen as a failure and therefore some

feel no part of it should be considered going forward. A new project should have

scalability, which was one of the difficulties of the Phase 1 project. Bus on fixed

guideway proposals are being pushed forward as a way to scale a project.

Commuter rail is being heavily considered, although it is less effective in changing

land use. Several smaller projects would allow a better spread of resources around

the region. King then said that neither criteria for selection and prioritization nor

funding have been determined.