Category: Funding & Finance

Value Capture: Financing sustainable transportation

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Portions of the North/Clybourn Red Line station were completely rebuilt using funds contributed by Apple in an example of joint development – a value capture financing tool. Photo by Kevin Zolkiewicz.

Ed. note: Jason Saavedra was a fellow student at the University of Illinois at Chicago College of Urban Planning and Public Affairs. He is now a planning, policy and communications consultant and writes for a blog called the Terre Haute Project in Terre Haute, Indiana. -Steven

As a nation, we are not investing enough money in our transportation infrastructure. We pay for transit, sidewalks, roads, and trails using a set per-gallon fuel tax – an unsustainable revenue source (see note 1) – and the recently proposed MAP-21 surface transportation bill does not propose any new fees or tax increases to ensure that federal money will be available to pay the cost of maintaining our transportation system.

The unsustainable nature of our current transportation funding system is not really news,  and Grid Chicago readers are particularly well-informed: we discussed the shortfalls of “traditional” transportation funding in a recent series of posts. But what may be news to you is that forward-thinking local communities are choosing to go the DIY route: they are looking for innovative ways to pay for needed infrastructure investment themselves.

This is where Value Capture (VC) comes into play. Continue reading Value Capture: Financing sustainable transportation

What is attainment? How Chicagoland may lose $90 million in federal funding annually

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Transit and road improvement projects that increase efficiency and reduce emissions are at risk. Photo of Red Line and Dan Ryan traffic, looking north to the Chicago Loop. 

Chicago is currently a non-attainment area.

That means we don’t meet National Ambient Air Quality Standards (NAAQS) “for pollutants considered harmful to public health and the environment” (read more), standards which are regulated by the United States Environmental Protection Agency (EPA). Six pollutants are measured across the country (note 1).  We currently don’t attain standards for particle pollution, specifically Particulate Matter 2.5; they’re particles smaller than 2.5 micrometers and “referred to as ‘fine’ particles and are believed to pose the greatest health risks”. Additionally, we’re a maintenance area for the 8-hour ozone standard. It is this designation that puts a large portion of the region’s transportation funding risk. Continue reading What is attainment? How Chicagoland may lose $90 million in federal funding annually

Ray LaHood stops in Logan Square, announces $20 million in stimulus funds for Blue Line repairs, bike share

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U.S. Transportation Secretary Ray LaHood swung through Chicago this afternoon as part of a national tour to publicize federal stimulus funding for transportation projects. Joining Governor Pat Quinn and Mayor Rahm Emanuel for a press conference outside at the CTA’s Logan Square stop in frigid, blustery weather, LaHood heralded a $20 million TIGER III (Transportation Investment Generating Economic Recovery) grant for Chicago.

According to the Chicago Department of Transportation (CDOT), $16 million will go towards fixing slow zones on the Blue Line between Belmont and Damen, in combination with money for the project from a CTA operating surplus. This work will allow trains to travel more than twice as fast in some locations, cutting the travel time from the Loop to O’Hare by several minutes.

The remaining $4 million of the grant will go towards Chicago’s new bike sharing system, slated to launch next summer. Added to the project’s existing $18 million Congestion Mitigation and Air Quality Improvement (CMAQ) funding that will pay for the first 3,000 bikes and 300 docking stations, the TIGER money will allow the city to eventually add 1,000 additional bikes and 100 more stations.

Chicago originally applied for a total of $50 million in TIGER III funds, $40 million for the Blue Line and $10 million for the bike share system, according to CDOT. Here’s a transcript of LaHood’s remarks at the press conference.

Continue reading Ray LaHood stops in Logan Square, announces $20 million in stimulus funds for Blue Line repairs, bike share

Parking meter lease: 72 years more to go

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Bike Walk Lincoln Park in their latest post gives a summary of how the parking meter lease was devised and approved in 2008. Then they point out how a majority if the revenue has been spent, including over half of a “rainy day fund” (as former Mayor Daley called it). But Bike Walk Lincoln Park mentions a report issued by the same company the Daley administration hired to advise it through the parking meter privatization process: Continue reading Parking meter lease: 72 years more to go

Replacing the gas tax with distance-based charging

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In the future, you may receive a bill that shows you a map of where you drove and how much you owe. The map above shows an actual, circuitous route I took from Avondale to the Loop, and was generated by a GPS device I carry. 

This is part two of two about a seminar in October about infrastructure funding and financing held by the Metropolitan Planning Council at their office at 140 S Dearborn. The first article talked about innovative ways to fund construction of highways, airports, transit, and other capital-intensive projects. The final speaker, Dr. Paul Hanley from the University of Iowa, talked about charging drivers based not on how much gas they use, but the distance they drive. This is known under several names but here I’ll be using “mileage charge” (see note 1).

A mileage charge can make up for the loss of gas tax revenues that’s happening because of an improvement in cars’ fuel efficiency, and that Americans as a whole are driving less. It would also charge those who drive electric cars; the current gas tax system, in essence, has those who drive the least efficient automobiles pay more for 100 miles of driving on roads than those with the most efficient automobiles. Each jurisdiction you drive through could have a different charge, similar to how each state, county, and city can charge a different rate for gas taxes (see note 2). Continue reading Replacing the gas tax with distance-based charging

Innovative financing for transportation infrastructure, notes from a seminar

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The Metropolitan Planning Council graciously provided me with a free entry to a seminar in October about infrastructure funding and financing at their office at 140 S Dearborn. The seminar featured Rob Puentes of the Brookings Institution, Illinois Senator Heather Stearns, and Dr. Paul Hanley a professor at the University of Iowa. They talked about three innovative ways to fund construction of highways, airports, transit, and other capital-intensive projects: the surface transportation bill (Puentes), public-private partnerships (Stearns), and distance-based taxing (Hanley).

This article will be presented in two parts: presentations from Puentes and Stearns today, and Hanley on Friday. It is my intention that by presenting that discussion to readers, you can learn about some of the ways infrastructure in the United States is paid for.

Continue reading Innovative financing for transportation infrastructure, notes from a seminar