promoting joint development in florida · •tod: smaller agency role, such as planning or...
TRANSCRIPT
Freight, Logistics & Passenger Operations
Promoting Joint Development
in Florida
FPTA Annual Conference and EXPO
October 29, 2013 | Clearwater Beach, FL
Diane Quigley, Transit Planning Administrator
FLORIDA DEPARTMENT OF TRANSPORTATION
Presentation Map
1. What is Joint Development?
2. What are the Benefits of Joint Development?
3. Why Pursue Joint Development?
4. What Role Should We Play?
5. What is FTA’s Role?
6. Case Study Takeaways
7. Getting Started
Joint Development Includes:
– A specific real estate project or existing property
– A formal agreement or relationship between a transit
agency and a private entity
– Direct participation of the transit agency in revenue
streams and/or an ownership stake in the project
– Transit agency property, air rights, or private land that
is physically or functionally integrated with a transit
facility
– A combination of two or more characteristics listed
here
FTA Definition
Joint development may include partnerships for
public, private, and/or non-profit development
associated with fixed-guideway (rail or bus)
transit systems that are being improved through
new construction, renovation, or extension
Types of Joint Development
Parking
Residential
Commercial
Intermodal Facilities
Transit Malls
Historic Transportation Facilities
FTA Definition
– A public transportation project that is integrally related
to and often co-located with commercial, residential,
or mixed-use development
– FTA has an interest in joint development when:
• (1) FTA funds are used for a capital project related to the
development
OR
• (2) Joint development takes place on real property that was,
or will be, purchased with funds administered by FTA
How is Joint Development Different from TOD?
Similar purposes, but significant differences:
– Role
• JD: Transit agency is a partner in a specific development project
• TOD: Smaller agency role, such as planning or providing services
– Scale • JD: Often involves just a single property. It’s a subset of TOD
• TOD: Typically larger in scope, often encompassing an entire neighborhood or at least a ½ mile walk shed
– Funding • JD: Often supported by FTA dollars, triggering federal rules
• TOD: Less likely to involve FTA funds for the actual development
Joint Development – A Subset of TOD
Joint Development Example (project scale)
Morristown, NJ apartments connected via walkway
to commuter rail station. Image credit: Pictometry
TOD Example (neighborhood scale)
The Hartford, CT TOD Plan covers much of the walk shed. Image credit: Massachusetts Office of Energy & Environmental Affairs
Florida Examples
Basic Project Information
Project Year Transit Type Lease Terms Development Key Benefits
Kings Avenue Station, Jacksonville
2009 Skyway (monorail)
40-year land lease with 30 year renewal option.
2 hotels with 230 rooms
Lease and parking revenue
Brownsville, Miami
2010 Heavy Rail
50-year land lease, two 20-year options
467 housing units
Ridership up 30%
Dadeland North, Miami
1994-2005
Heavy Rail 99-year land lease
168 housing units, 395K sq. ft. retail, 127K sq. ft. office
Base lease payment and a percent of revenues
Florida Example – Brownsville
Before (Miami-Dade Transit)
Surface parking
shown in 2008.
Joint development
opportunity site.
Brownsville Station, Miami Image credit: Google Earth
Brownsville After
Private development
on former surface
parking
Existing rail station
Brownsville Station, Miami Image credit: Pictometry
Texas Example (DART)
Downtown Plano
Before Photo, Mid-1990s
Downtown Plano
After Photo, Post-2003
Sites assembled by
transit agency (DART)
Benefits
Direct
– A source of revenue for the transit agency
– A tool for the transit agency to capture value
– Cost sharing on facility construction and/or operation
– Increased ridership due to proximity/accessibility
– Improved station facilities and surrounding properties
– Better links between transit and other modes
Indirect
– Stimulate the market for TOD and demonstrates concept
– Internal capacity building and catalyst for TOD policies
– Improve interagency coordination
Role of Transit Agency
Market-Led Approach
– Jacksonville: Developer approaches transit agency
Coordinated Approach
– Miami: Joint development built into agency approach
from the beginning. Coordination with other
departments and affordable housing builders.
– Dallas (DART): Work closely with city
Project Packaging Approach
– Charlotte (CATS): Strongly intervene around stations
with less market demand
Factors in Pursuing Joint Development
Any agency considering joint development
should assess the following factors:
– Lease or purchase
– Health of the local real estate market
– Entrepreneurial capacity of the transit agency
– Working relationships with other key agencies, such
as the local planning department. Joint development
requires extensive coordination
– Revenue, ridership, and cost-sharing potential
Implementation Steps
Consistency with General Vision and Strategy
Identify Potential Sites
Market Analysis
Parking Use Analysis
Focused RFP or RFQ
Charlotte, NC Example
Joint development area near Scaleybark Station.
Property acquired with FTA and city funds.
Held for future development. Image credit: City of Charlotte
Winning proposal.
Actions
Within each approach, the agency will take different actions to create policies and close deals:
Policy Making – Create plans and regulations
– Create a framework for deal making
Deal Making – Project level negotiation on issues such as land assembly,
entitlement, infrastructure, financing, transit service, etc.
– Land ownership drives much of the deal making
– Coordination with local government is key. They hold zoning and permitting powers
FTA’s Role
FTA has 2 primary concerns in any joint
development project:
– Funding Eligibility: Is the project eligible for FTA
financial support?
– Property: Is there a federal interest in the property
being considered for joint development?
These questions are key because federal
funding and a “federal interest” in the property
will trigger FTA oversight and rules
FTA Legal and Policy Framework
FTA’s support for joint development
strengthened through SAFETEA-LU & MAP-21:
– SAFETEA-LU stated that a capital project may include
transit improvements that “incorporate private investment,
including commercial and residential development”
– MAP-21 is the first federal transportation law to explicitly
include “joint development” under the definition of a transit
capital project
• Emphasizes Public-Private Partnerships (PPPs)
FTA’s Joint Development Policy
Federal support for joint development is growing. FTA released its official policy in 2013: – “FTA’s policy is to maximize the utility of FTA-funded
projects and encourage transit agencies to generate program income through joint development. The benefits of joint development include revenue generation for the transit system through “value capture” mechanisms, such as income derived from rental or lease payments, and private sector contributions to public infrastructure. Other benefits include shared costs, efficient land use, reduced distance between transportation and other activities, economic development, increased transit ridership, and improved transit connectivity”
Joint Development in New Starts
Also, FTA’s proposed New Starts policy from
January 2013 supports joint development:
– Activity Line Item (ALI) 20.05 Joint Development
• “All costs on this line item may be removed from the cost
effectiveness calculation.”
– “FTA hopes that the credit will encourage sponsors to
undertake joint development efforts as part of New
and Small Starts projects; few to date have included
joint development-related costs.”
Federal Funding Criteria
• Does the project enhance economic development OR incorporate private investment?
Economic Benefit
• Does the project enhance public transportation and relate physically or functionally to that public transportation project, OR does the project establish new or enhanced coordination between transit and other transportation?
Public Transportation Benefit
• Does the project provide a fair share of revenue for public transportation?
Fair Share of Revenue
• Do entities occupying space in a facility constructed with FTA funds pay a fair share of the costs of the facility through rental payments or other means?
Fair Share of Costs
Eligible Activities
Once you have determined that you have an eligible project, what can you use federal funds for?
– The list is not exhaustive, but includes items such as:
• Property acquisition
• Demolition of structures
• Site preparation
• Utility relocation and construction
• Building foundations
• Walkways and bike lanes connecting to station
• Construction of space for commercial use
– Only 2 ineligible activities are listed: • Outfitting a commercial space
• Construction of a public facility not related to public transportation
www.pedbikeimages.org / Burden
FTA’s Interest in Property
One of FTA’s big concerns is protecting the
transit purpose of any property acquired through
its funding programs. The grantee must maintain
“satisfactory continuing control” until the property
is no longer needed for its original purpose
The grantee can “encumber title to, or interest in,
real property acquired with FTA assistance” for
the purpose of joint development
Other Federal Requirements - NEPA
Common Scenarios Requires Environmental
Review?
1. FTA is financially assisting a joint development as part of a fixed guideway capital investment or other large project
Yes
2. FTA is financially assisting joint development as a separate standalone project
Yes
3. FTA has a financial interest in the property on
which the joint development will be located, but FTA is not financially assisting the implementation of the joint development
Yes if the land was acquired for the purpose of a joint development. Probably not if the land were acquired for a different reason. In that case the proponent can request a “lack of objection” from FTA.
Other Federal Requirements
Other requirements that may apply include:
– Metropolitan planning (the project must appear in the TIP if
using federal funds)
– Civil rights
– Historic preservation
– Procurement
– Labor protection
– Buy America
– Lobbying
– See the Federal Circular for additional information
Federal Rules – Key Takeaways
FTA’s joint development policy supports TOD, but the main objective is to create new avenues for funding transit services
FTA-supported joint development projects must provide a fair share of revenue for the agency
“Fair share” is not clearly defined. However, FTA may not view increased ridership as a sufficient source of revenue
Crosscutting federal requirements add complexity and cost for developers
Case Study Communities
Key Takeaways
Ridership Benefits vs. Revenue Benefits
Be Proactive
Be Realistic
Be Patient
Don’t be Overly Prescriptive
Key Takeaways
Selling Land vs. Ground Lease
Discounted Land or Lease often Necessary
Agencies Need More JD/TOD Support
Seek Assistance
FTA Wants to Work with You
Case Study Lessons - FTA
Communicate Early and Often
FTA can be Flexible
Understand FTA’s Requirements
Getting Started
Evaluate the Potential
Policy-Making Level 1. Create an inventory of agency-owned land and air rights
that could be used for development
2. Determine which sites have opportunities based on factors
such as size, transit service, and market demand
3. Assess agency powers and staff capabilities to make deals
and decide what type of assistance/expertise is needed
4. Conduct TOD planning, set objectives, and identify tools.
5. Decide whether or not to acquire land for joint development
6. Decide whether or not to offer financial incentives to
developers
Evaluate the Potential
Deal-Making Level 1. Decide how to partner with developers and local
government
2. Decide how land will be conveyed. Developers may be
wary of a ground lease arrangement.
3. Decide what price to ask considering market demand and
agency requirements such as affordable housing or
structure parking
4. Determine if FTA will be involved
Implementing a Project
1. Create a vision for the property and set parameters on desired development mix (use, density, etc.) • Work with the local government(s)
2. Prepare and release a RFQ or RFP
3. Negotiate a revenue and/or cost-sharing agreement, and the means of land conveyance, with the selected developer
4. Negotiate means of maintaining transit service/access during construction period
5. Negotiate maintenance and operations agreements
6. Obtain FTA approval (the timing of this step will vary) • Start with the checklist, but stay in close contact throughout
Getting Started with FTA
– Complete checklist and submit to regional office
FTA & FDOT Contacts
Region 4 – Atlanta – Regional Administrator reviews the joint development
checklist and approves projects in Florida
– (404) 865-5600
FDOT – Central Office Diane Quigley, Transit Planning Administrator
(850) 414-4520
Nina Verzosa
(850) 414-4217
Resources
Federal Circular
March 2013 FTA Webinar
Reconnecting America Joint Development
Resources
Wrap Up
Questions and Discussion
Dadeland South, Miami Image credit: Pictometry