High Capacity Transit Task Force March 8, 2018
Today’s Agenda ▪ Introductions ▪ Innovative Finance Report ▪ Service Concepts Report ▪ Economic Development Report ▪ Next Steps
Innovative Finance ▪ Draft Phase I Deliverable Document (in packet) ▪ Full List of Financing Tools ▪ Regional Governance Models
List of Financing Tools ▪ Workgroup tasked with creating a “complete list” of tools to present to HCT Task Force ▪ Some tools might not currently be available/feasible ▪ Understand difference between funding tools and financing tools
Traditional Financing Tools Public Authorization or Mechanism for Flow of funds to Limitation on Financial Tool Subsidy or Application to HCT funding/financing HCT infrastructure Usage? Support? in Texas? Directly to projects General Dedicated source or general designated via Yes – No legal Obligation Yes obligation pledge of taxing entity Entity debt capacity program or limitation Bonds (e.g. municipality) referendum Debt secured by specific revenue Directly to projects Based upon project Yes – No legal Revenue bonds Not directly stream (fares, rents, etc) designated credit, forecast, etc. limitation Yes - can be directly Financing secured by Based upon public Yes – No legal Sales Tax to designated project Yes commercial sales within selected appetite for tax and limitation Revenue (determined via entity tax borders state law referendum usually) Yes - can be directly Financing secured by property Based upon public Yes – No legal Property Tax to designated project Yes tax levies within selected entity appetite for tax and limitation Revenue (determined via tax borders county law referendum usually)
Traditional Financing Tools Public Authorization or Mechanism for Flow of funds to Limitation on Financial Tool Subsidy or Application to HCT funding/financing HCT infrastructure Usage? Support? in Texas? Grant Limited by the State grants cannot Debt secured by anticipated Directly to projects or Anticipation Yes value/parameters of be applied to HCT future federal grants program via grant Notes federal grant projects State Loan and Credit enhancements Yes - to sponsors Limited by project Limited to highway- Infrastructure Yes to sponsors of particular capital private and public type related projects only Bank projects Financing secured by property Directly to Increase in tax base Tax Increment Yes – No legal Not directly tax revenues increases within infrastructure within according to Financing limitation specified area or district designated area ordinance Funding programs designed to provide direct, designated State Sources: Limited by state-level investments from state DoTs to Directly to programs Limited to highway- SDFs and Yes determination on transit projects and programs. and projects related projects only STOAs funding Usually outside of metropolitan transit agencies.
Traditional Financing Tools Public Authorization or Flow of funds to HCT Limitation on Financial Tool Subsidy or Mechanism for funding/financing Application to infrastructure Usage? Support? HCT in Texas? Currently being discussed Charges applied to passengers by the Passenger by the FAA and Federal Currently limited No - User airport agencies. Capped at $4.50 Facility Charges government to allow PFCs to direct airport To be determined charge per flight segment and with a (PFCs) to be applied towards facilities maximum of $18 per round trip flight. HCT related to airports Similar to TIFs, TRZs require the municipality to designate a zone in Transportation which it will promote the Directly to the identified No legal Yes – No legal Reinvestment Not directly transportation project and enable and qualified project limitation limitation Zone (TRZ) incremental increases in funding to be applied to a specific transportation project with the designated one. Program enabling state and local Limited to social Community governments to transform a small infrastructure Redevelopment portion of their Community Flow to ancillary Limited to social No - User projects capable Act and Grants Development Block Grant (CDBG) infrastructure to HCT, but infrastructure, not charge of spurring (HUD Federal funds into federally guaranteed loans not HCT directly including transit private Program) large enough to pursue physical and investment economic revitalization projects.
Innovative Financing Tools Public Authorization or Mechanism for Flow of funds to Limitation on Financial Tool Subsidy or Application to HCT funding/financing HCT infrastructure Usage? Support? in Texas? Directly to Tax-exempt debt issued by state State debt capacity for Private Activity In some project/private entity Yes – No legal or agency to provide financing PABs as designated by Bonds (PABs) cases for which bonds are limitation for a private entitiy federal law underwritten Transportation Infrastructure Subordinate loan (up to 49% of Federal Directly to projects Based upon project Yes – No legal Finance project) secured by the federal Subsidy designated credit, forecast, etc. limitation Innovation Act government (TIFIA) FRA Railroad Subordinate loan (up to 100% Rehabilitation Federal of project) secured by the Directly to project Based upon project Yes – No Legal and Subsidy federal government. Specifically designated credit, forecast, etc. Limitation Improvement for rail infrastructure Financing (RRIF) Public-Private Private Investment combined None financially, legal In some Directly to project Yes – No Legal Partnerships with public investment if limitations dependent cases designated Limitation (P3s) applicable upon public agency
Innovative Financing Tools Public Authorization or Mechanism for Flow of funds to Limitation on Financial Tool Subsidy or Application to HCT funding/financing HCT infrastructure Usage? Support? in Texas? Value Capture (Includes Naming Rights, Station Directly to project Revenues, Joint Usually Private investment, existing or Yes – No legal designated Private sector interest Development, private planning infrastructure limitation Parking Revenues, Advertising, etc.) Transportation Federal credits for local/state Distributed per Yes – No legal Development Public Per state/MPO policy investment in toll facilities state/MPO policy limitation Credits (TDCs) Based on Congestion and private and Pricing can be driven by facility Variable, based on Utilization of facility ??? Toll Pricing commercial or geography program or policy or geography utilization
Projects from Example Regions Example Region Project Name Project Type Financing Tool(s) Used Cleveland Healthline/CSU Bus Rapid Transit Value Capture (Naming Rights) Sales Tax Revenues, TIFIA Loan, Denver Eagle Line Light Rail Value Capture (TIF District around Union Station), PPP All Aboard Private Investment, Value Capture Miami Intercity Rail Florida (station-area development) Confederation Tax revenues, federal and provincial Ottawa Light Rail Line grants, PPP Tax Revenues, TIFIA Loans, Bond Light Rail, HOV Lane Seattle East Link Proceeds, Grant Revenues, Local Expansion Contributions Virginia I-95/I-395 Bus Rapid Transit, HOV Lane PAB, TIFIA Loan, PPP Washington DC Purple Line Light Rail TIFIA Loans, Private Activity Bonds
Projects from Example Regions
Governance Structures ▪ Single Regional/Local Transit Provider ▪ Jurisdictionally-Based Multiple Transit Provider ▪ Market-Based Multiple Transit Provider
Single Regional/Local Transit Provider ▪ Regional transit service delivered through single decision-making body ▪ Benefits: Ability to apply uniform service standards/fare policy and deliver a more coordinated regional transit network ▪ Drawbacks: Lack of control at local/community level, potential for uneven distribution of transit services and facilities based on jurisdictional contribution to the system
Jurisdictionally-based Multiple Transit Provider ▪ Regional transit service delivered through multiple agencies, based on jurisdiction ▪ Benefit: Local control over transit decision making ▪ Drawbacks: Non-uniform service standards, uncoordinated services and fare policies, potential difficulty in using transit for cross-regional travel The transit service governance structure in the Houston-Galveston region is most closely related to this model.
Market-based Multiple Transit Provider ▪ Responsibilities for local and regional services are allocated to different agencies ▪ Benefits: Ability to apply uniform service standards for regional services, while providing local control over local services; local transit providers freed from potential burden of regional service operations ▪ Drawbacks: Potential for non-uniform service standards and differing fare policies between local transit providers and regional transit provider
Example Regions Governance Structure Countr ntry City y or R Region Singl gle e Regional nal/Local cal Jurisdi dictionall ctionally-based based Mark rket-based based Pro rovider er Multi tiple ple Pro rovide der Multi tiple ple Pro rovide der Atlanta R Austin R Cleveland R Dallas/Fort Worth R Denver R Los Angeles R Miami R Seattle R Washington, DC R Ottawa R Vancouver R Dubai R
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