reston funding plan

County of Fairfax, Virginia

Reston Funding PlanReston Network Analysis & Funding Plan Advisory Group

June 20, 2016

Tom Biesiadny, Ray Johnson, Janet Nguyen, Ken KanownikFairfax County Department of Transportation

Department of Transportation 1

Funding Scenarios


Outline• Updates

– Meeting with Advisory Group Developers, June 6– Project Costs

• Follow-up from April 11, 2016 meeting– Tax Increment Financing (TIF)– Herndon Projects Associated with Silver Line Phase II– Herndon Metrorail Station Access Management Study

(HMSAMS)– Reston Metrorail Access Group (RMAG)– Land Value Analysis

• Discussion of funding scenarios



Estimate - Updates


Reston Funding Plan Projects Updated Est. Previous Est. Change

Roadway Projects DTR Crossing at Soapstone Overpass – Sunrise Valley Dr to Sunset Hills Rd $170,000,000 $160,000,000 $10,000,000 DTR Crossing at Rock Hill Road Overpass – Sunrise Valley Dr to Loudoun Co $80,000,000 $80,000,000 $0 DTR Town Center Parkway Underpass – Sunrise Valley Dr to Sunset Hills Rd $170,000,000 $170,000,000 $0 South Lakes Drive Overpass – Sunrise Valley Drive to Sunset Hills Rd $90,000,000 $90,000,000 $0 Route 286 - DTR to West Ox Widening $80,000,000 $80,000,000 $0 Route 286 at Sunrise Valley Drive (Interchange) $400,000,000 $400,000,000 $0 Reston Parkway Widening – South Lakes Drive to DTR $25,000,000 $25,000,000 $0 Fox Mill Road Widening – Reston Parkway to Monroe Street $60,000,000 $60,000,000 $0 West Ox Road Widening – Lawyers Road to Centreville Road $100,000,000 $100,000,000 $0 Monroe Street Widening – West Ox Road to Town of Herndon $80,000,000 $80,000,000 $0 Pinecrest Road Extension – South Lakes Dr to Sunrise Valley Dr $25,000,000 $25,000,000 $0 McNair Farms Drive Extension/Widening $10,000,000 $10,000,000 $0

Total Roadway Projects $1,290,000,000 $1,280,000,000 $10,000,000 Intersection Projects Centreville Road at Sunrise Valley Drive $10,000,000 $10,000,000 $0 Centreville Road/DTR EB on/off Ramps $1,500,000 $1,500,000 $0 Reston Parkway/Sunrise Valley Drive $15,000,000 $15,000,000 $0 Reston Parkway/DTR WB on/off Ramps $5,000,000 $5,000,000 $0 Reston Parkway/Bluemont Way $4,000,000 $4,000,000 $0 Reston Parkway/New Dominion Parkway $5,000,000 $5,000,000 $0 Wiehle Avenue/DTR EB on/off Ramps $600,000 $600,000 $0 Hunter Mill Road/Sunset Hills Road $3,500,000 $3,500,000 $0

Total Intersection Projects $44,600,000 $44,600,000 $0 Grid Network* $1,021,000,000 $1,244,000,000 ($223,000,000) Total $2,356,000,000 $2,569,000,000 ($213,000,000)

*Current grid network estimate is based on preliminary results from the Network Analysis Study and may be subject to adjustment.


Reston Funding Plan Allocation FrameworkThis cost split was chosen by staff as basis for funding scenarios. Staff is still seeking comments on this proposal.

In this example, public and private revenues* will share costs, approximately equally.

Reston Roadway projects would be paid for with public revenues.

Most Intersections and the Grid would be paid for with private revenues.


Please note that the information provided in this presentation is not final and is for discussion purposes only.

Option 5: Project Category

Project Estimate Allocation ($) Reston Roadways $1,290,000,000 Public Share 100% $1,290,000,000Private Share 0% $0 Reston Intersections $45,000,000 Public Share 0% $0Private Share 100% $45,000,000 Grid $1,021,000,000 Public Share 0% $0Private Share 100% $1,021,000,000 Total $2,356,000,000 Public Share 55% $1,290,000,000Private Share 45% $1,066,000,000

Previously $1.289

Previously $1.244B

Previously $1.280B

Public/Private share in Tysons is 56/44

*Public revenues are those revenues allocated by the County for use on Countywide projects.*Private revenues are generated in Reston and used exclusively for Reston projects. Includes: road fund, TIF, service and tax districts, etc.


Tentative Allocation of Grid of StreetsIn-Kind vs. Road Fund (Cash Proffers)



Tax Increment FinancingTax Increment Financing (TIF) – A funding mechanism that captures net new tax revenues within a defined geographic area (TIF district) to fund public projects in the TIF district to promote economic development or redevelopment.

• Define district, usually commercial, to declare a tax increment district, which will be developed for higher and better use.

• Define a base year assessment. Tax revenue at the base year is “frozen” continuing to accrue to the normal tax funds at those assessment levels.

• Additional tax revenue (tax increment) based upon increases in assessed values over and above the base year assessment rate are allocated to a tax increment fund, and would be used to fund identified improvements.

• Financing option – Property taxes are most commonly used to fund TIFs. TIF revenues are usually pledged to support bond debt service (requires Community Development Authority (CDA)). May be used as pay as you go, rather than to support debt.

• TIF does not directly change the Real Estate Tax rate.



Tax Increment Financing (Mosaic District)Fairfax County, VA – Merrifield Town Center (Mosaic District) – District created to provide vehicle for financing public improvements to develop district in accordance with existing zoning.

In the district:• $30 million portion of public facilities would be funded through a 30 year bond

issued by the District whose debt service would be paid by a self-assessment.

• $42 million dollar portion of public facilities constructed on-site (road improvements, parks, portion of parking garage) through a 22 year bond issued through the District whose debt service is paid through incremental real estate tax revenues (TIF). Liability for the debt service is secured by the District not the County. As a result the bonds do not achieve a AA rating.



Tax Increment Financing (Mosaic District)

Mosaic District:

• 1,000 dwelling units, multi‐plex theatre, 125,000 square feet of office space, 500,000 square feet of other non‐residential uses, 150 room hotel.

• Public Improvements: 2 parks, realignment and widening of Eskridge Road, widening of Lee Highway, improvements to the Lee Highway/Gallows Road intersection and, construction of a grid of streets.



Tax Increment FinancingMosaic district was uniquely fit for Tax Increment Financing: • Fairfax County’s Office of Community Revitalization (OCR) and a consultant

team worked with one development to establish the Mosaic District CDA via petition to the Board of Supervisors.

• The petition was evaluated against the County’s “16 Principles for Public Investment in Support of Commercial Redevelopment” which was adopted by the board in 2008 to advance revitalization and reinvestment opportunities within the County.

• Evaluation determined that the project, to turn the area into the town center of Merrifield, would not occur but for the use of TIF to support funding a portion of public facilities through bond financing.


http://www.fcrevit.org/programs/download/16Principles.pdf

http://www.fcrevit.org/programs/download/16Principles.pdf


Basic TIF Model


Base Year Assessment (Existing Tax Base)Revenues continue to accrue to normal tax funds.

Total New Tax

BaseTax IncrementTo support public infrastructure or bond debt service

Life of Tax Increment Financing District

Ann

ual T

axes

Gen

erat

ed

Frozen revenue for basic services

Basic TIF Model: Future Tax Revenue – Baseline Tax Revenue = TIF Revenue

Using the basic TIF model, a TIF district over the Reston TSAs may generate up to $900k per 1% of real-estate assessed value growth on its first year.

Assessed Value Growth Revenue

1% $ 900,000 2% $ 1,800,000 5% $ 4,500,000


Baseline Growth TIF ModelBaseline Growth TIF Model: Future Tax Revenue – (Baseline Tax Revenue x Growth Factor) = TIF Revenue



TIF Diversion ModelTIF Diversion Model:(Future Tax Revenue –Baseline Tax Revenue) x Diversion Factor = TIF Revenue (This method can be a set dollar amount or a percentage of revenue)



Herndon Metro PlanningMetro related projects to be funding by the Town of Herndon.

Total of all projects is $13,947,400.

From Herndon Metro Station Area Plan: http://www.herndon-va.gov/departments/community-development/planning-policy/metrorail-planning.


http://www.herndon-va.gov/departments/community-development/planning-policy/metrorail-planning





Herndon Metrorail Stations Access Management (HMSAMS) Study Projects

Project Location Project ScopeSunrise Valley Drive/Monroe Street Improve signalized crosswalks.

Van Buren Street/Worldgate Drive Add signalized crosswalk.

Herndon Parkway/Herndon Metro Entrance North

Add mid-block signalized crosswalk.

Dulles Toll Road/Monroe Street Pedestrian/Bicycle Bridge. Fund Feasibility/Cost Estimate Study.

Innovation Center to Arrowbrook Complete walkway with lighting.

Dulles Toll Road/Centreville Road Add lighting under Dulles Toll Rd. Add signalized crosswalk at north ramps.

Herndon Parkway from W&OD Trail to Fairbrook Drive

Improve access ramp at W&OD. Widen sidewalk to shared use path. Funding for Feasibility/Cost Estimate Study.

Chandon Park to Worldgate Drive Dulles Glen Apartments to Worldgate Dr. shared use path and lighting.

Coppermine Crossing to Merrybrook Improve FCPA fair-weather crossing to pedestrian bridge.

Innovation Avenue/Rock Hill Road Add shared use path and lighting.

Van Buren Street from W&OD to Monroe St Bridge

Reconstruct w/ on-road bike lanes, sidewalk(s), drainage, urban. Funding for feasibility/cost estimate study.

Monroe Street from Dulles Toll Road to Monroe Manor Drive Missing Links

Shared use path Dulles Toll Rd. to East Lake Dr., Fox Mill Rd. to Sunrise Valley Dr., Monroe Manor Dr. to Dwight St.

Sunrise Valley Drive from Fairfax County Parkway to Innovation Station

Reconstruct with on-road bike lanes. Reduce median width. Restripe with narrow lane widths.

Innovation Station North Side Neighborhood Access

Add Shared use path and lighting. Fund Feasibility/Cost Estimate Study.

Bicycle and pedestrian facility projects to improve access to the future Herndon and Innovation Center Metrorail Station: http://www.fairfaxcounty.gov/fcdot/hmsams/

These projects are funded separate from the Reston Funding Plan, mostly with public sources.


http://www.fairfaxcounty.gov/fcdot/hmsams/




Reston Metrorail Access Group (RMAG) and Wiehle Ave/Reston Pkwy Station Access Management Study Projects

Recommended station access management and traffic improvements at the Wiehle-Reston East Metrorail station.

More RMAG improvements can also be found here: http://www.fairfaxcounty.gov/fcdot/silverline/restonimp.htm

These projects are funded separate from the Reston Funding Plan, mostly with public sources.Department of Transportation

15

Project Location Project ScopeBluemont Way & Discovery Street/Explorer Street/Library Street

Improve crosswalks, bike facilities.

Sunset Hills Road/Old Reston Avenue Add signalized crosswalks.

Explorer Street/New Dominion Parkway Improve crosswalk.

Sunrise Valley Drive from Reston Parkway to Soapstone Drive Missing Links

Complete shared use path north side. Add signalized crosswalk at Colts Neck Rd.

Sunrise Valley Drive/Edmund Halley Drive Add signalized crosswalks.

Sunset Hills Road/Discovery Street Pedestrian Bridge Walkway Extended

Add signalized crosswalk.

Reston Parkway/Dulles Toll Road Westbound On-Ramp

Add signalized crosswalk. Remove southbound free-flow right turn.

Reston Parkway/Dulles Toll Road Eastbound Off-Ramp and On-Ramp

Add signalized crosswalks. Remove northbound free-flow right turn.

Dulles Toll Road Eastbound Off-Ramp/Fairfax County Parkway Trail

Realign trail to barrier-separated on shoulder. Realign trail crossing. Add signalized crosswalk.

Sunset Hills Road Eastbound Off-Ramp/Fairfax County Pkwy Trail

Realign trail crossing. Add signalized crosswalk.

Bluemont Way from Discovery Street Pedestrian Bridge Walkway to Reston Parkway

Add sidewalk south side.

Sunset Hills Road from Town Center Parkway to Reston Town Center Station Entrance

Complete shared use path north side.

New Dominion Parkway from Reston Parkway to Fairfax County Parkway


Town Center Parkway/W&OD Trail Add access ramp at W&OD trail west side.

Town Center Parkway from Sunset Hills Road to Baron Cameron Avenue


Sunrise Valley Drive from Reston Parkway to Fairfax County Parkway


Sunrise Valley Drive/Reston Association Entrance Add signalized crosswalks.

Reston Bikeshare Phase 2 Bikeshare Expansion for Phase 2 Silver Line Metrorail.

http://www.fairfaxcounty.gov/fcdot/silverline/restonimp.htm




Land Value Analysis


Comparison – Reston TSAs to Tysons Assessed Values Reston 2015 Tysons 2015 Dollar PercentResidential Value/DU $ 260,129 $ 220,362 $ 39,766 15%Commercial Value/Sqft $ 239 $ 284 $ -45 -19%Residential Value/Sqft $ 221 $ 188 $ 32 15%Average Value/Sqft* $ 235 $ 261 $ -26 -11%

* Assessed value for a given sq. ft. regardless of zoning


Scenarios – April AG Meeting


Contribution Rates to meet $480M

Residential/DU Commercial/SF Funding Shortfall

Scenario 1: Tysons residential rates $2,571 $27.80 $0Scenario 2: Tysons commercial rates $8,036 $12.63 $0Scenario 3: Rates proportional to Reston development $9,680 $8.07 $0Scenario 4: Tysons rates and service district over Reston TSA $2,571 $12.63 $208.43MScenario 5: Tysons rates and tax district over Reston TSAs $2,571 $12.63 $208.43MScenario 6: Tysons Rates and Service District over Reston &TSAs $2,571 $12.63 $206.01MScenario 7: Tysons Rates and Service District over Sp. TD5 $2,571 $12.63 $190.9M



Private Contributions


Estimate of Private Contributions Needed – Updated from Previous AG Meeting

April JuneReston Grid Estimate Percent Estimate PercentGrid estimate $1,244,000,000 100% $1,021,000,000 100%Less: Expected in-kind contributions $809,000,000 65% $711,000,000 70%Funding gap for Grid $435,000,000 35% $310,000,000 30%

Private Cash Contributions Needed (Rounded) Estimate EstimateFunding gap for Grid $435,000,000 $310,000,000 Intersections $45,000,000 $45,000,000 Total other private contributions needed $480,000,000 $355,000,000

Add: In-kind contributions $809,000,000 $711,000,000 Total private share of entire plan $1,289,000,000 $1,066,000,000



New Funding ScenariosNew Scenario 6 and 7 were developed in response to analysis of land values in Reston and Tysons.


• New Scenario 6: Makes a general adjustment of 11 percent to the combined Tysons residential and commercial rates.

• New Scenario 7: Makes a specific adjustment of 15 percent to the combined Tysons residential rate and -19 percent to the combined Tysons commercial rate.

Comparison – Reston TSAs to Tysons Assessed Values Reston 2015 Tysons 2015 Dollar PercentResidential Value/DU $ 260,129 $ 220,362 $ 39,766 15%Commercial Value/Sqft $ 239 $ 284 $ -45 -19%Residential Value/Sqft $ 221 $ 188 $ 32 15%Average Sqft* $ 235 $ 261 $ -26 -11%*Assessed value for a given sq. ft. regardless of zoning


New Funding Scenarios


New Scenario 6: Makes a general adjustment of 11 percent to the combined Tysons residential and commercial rates and leaves a funding shortfall of $111.20 million.

New Scenario 7: Makes a specific adjustment of 15 percent to the combined Tysons residential rate and -19 percent to the combined Tysons commercial rate and leaves a funding shortfall of $85.22 million.


Scenarios - Update


Contribution Rates to meet $355M

Residential/DU Commercial/SF Funding Shortfall

Scenario 1: Tysons residential rates $2,571 $18.70 $0Scenario 2: Tysons commercial rates $4,759 $12.63 $0Scenario 3: Rates proportional to Reston development $7,159 $5.97 $0Scenario 4: Tysons rates and service district over Reston TSA $2,571 $12.63 $83.43MScenario 5: Tysons rates and tax district over Reston TSAs $2,571 $12.63 $83.43MNew Scenario 6: General adjustment from Tysons rates $2,288 $11.24 $111.20New Scenario 7: Specific adjustments from Tysons rates $2,957 $10.23 $85.22



Funding GapThe various funding gaps can potentially be funded through the following mechanisms:• Tax District: $0.03/$100 of assessed values for commercial and industrial

properties in Reston TSAs.*• Service District: $0.015/$100 of assessed values for all properties in

Reston TSAs.* Service District Rate in Tysons FY17 is $0.05/$100 assessed value.



Contribution Rates to meet $355MResidential/DU Commercial/SF Funding Shortfall

Scenario 4: Tysons rates and service district over Reston TSA $2,571 $12.63 $83.43MScenario 5: Tysons rates and tax district over Reston TSAs $2,571 $12.63 $83.43MNew Scenario 6: General adjustment from Tysons rates $2,288 $11.24 $111.20New Scenario 7: Specific adjustments from Tysons rates $2,957 $10.23 $85.22*These are average annual rates that do not reflect actual cash flow needs. New Scenario 6 would need an additional $0.005 added to each rate to meet the shortfall.


Average Annual Cost to Property Owner


AssessedValue

Service District Rate

$0.015 $0.020 $0.025 $0.030 $0.035

$300,000 $45.00 $60.00 $75.00 $90.00 $105.00

$400,000 $60.00 $80.00 $100.00 $120.00 $140.00

$500,000 $75.00 $100.00 $125.00 $150.00 $175.00

$600,000 $90.00 $120.00 $150.00 $180.00 $210.00

$700,000 $105.00 $140.00 $175.00 $210.00 $245.00

$800,000 $120.00 $160.00 $200.00 $240.00 $280.00

$900,000 $135.00 $180.00 $225.00 $270.00 $315.00


Reston Funding Plan Next Steps• Seek feedback for cost allocation plan and funding scenarios.• Public meeting 6/27.• Advisory group feedback. • Board Transportation Committee (BTC) meeting, July or Fall.• Development of final recommendations.• Board of Supervisors approval by end of 2016.



Advisory Group Feedback on…• Do any of these scenarios work?• What features do you like? What features don’t you like?• Are you comfortable with a road fund at an appropriate rate?• What other options should staff be considering?



Comments/Questions/Discussion


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