ULI Washington News

Release: New Report Asserts Transit Oriented Development Provides Fiscal Benefits for Local Governments

TOD Not Only “Pays its Own Way” but Subsidized nonTOD Development

ULI Washington in conjunction with ULI Baltimore and the Baltimore-Washington, D.C. Transit-Oriented Development Product Council today released a new report, Fiscal Impacts of Transit-Oriented Development Projects.

The study of nearly 10,000 TOD and nonTOD apartment units within the Baltimore-Washington, D.C. metropolitan region concluded that transit-oriented development (TOD) is a responsible fiscal choice for local governments and can save them money.

A deeper fiscal impact analysis of four selected TODs found that these developments generated between S1.13 and $2.20 in tax and non-tax revenues for every $1 in public services provided to residents and employees.

These findings stand in stark contrast to oft-stated opposition in the Baltimore-Washington, D.C. metro region to the development of multifamily apartment and condominium projects near new metro stops. Opponents generally oppose the level of density these projects are permitted on the grounds that increased density will also place a greater burden on public services. The study found that if the same four TOD projects analyzed were not located at or near a transit rail station they would have only generated between $0.77 and $1.35 in tax and non-tax revenues for every $1 spent on public services.

Other key findings include:

  • TOD projects generate revenues at the city, county and state levels;
  • The median household income per unit for TOD projects is over 10 percent higher than nonTOD units;
  • NonTOD projects have larger average household sizes in both adult and school-age children populations, which generally pose a higher fiscal burden for cities and counties;
  • TOD development subsidizes city and county services for existing nonTOD residential development;
  • TODs do not place a greater burden on overall costs for public safety, public works and parks and recreation because average household size is generally smaller;
  • Fewer families with school-age children live in TOD apartments, lessening the need for educational services for local school systems.

“ULI’s responsible development principles encourage greater housing density in transit-oriented development to achieve a variety of environmental, health and social objectives,” Lisa Rother, Executive Director of ULI Washington stated. “This report clearly shows that transit-oriented development is not only the highest and best use of urban land and infrastructure, but is also a tax boon for municipalities, paying its own way and also subsidizing nonTOD development.”

The report encompassed data from 42 TOD and nonTOD projects comprising 9,546 apartments located in close-in urban-suburban areas in the region. Both the TOD and nonTOD apartments reflected the full range of building classes and contained at least 50 units per building.

Transit Oriented Development (TOD) is a planning approach that calls for high-density, mixed-use business/neighborhood centers to be clustered around transit stations and corridors. A TOD neighborhood typically has a center with transit access and TOD neighborhoods are located within a radius of one-quarter to one-half mile from a station or stop.

You can find a complete copy of Fiscal Impacts of Transit-Oriented Development Projects here.

About ULI Washington

ULI Washington is a district council of the Urban Land Institute (ULI), a nonprofit education and research organization supported by its members. Founded in 1936, the Institute today has over 30,000 members worldwide representing the entire spectrum of land use planning and real estate development disciplines working in private enterprise and public service. As the preeminent, multidisciplinary real estate forum, ULI facilitates the open exchange of ideas, information, and experience among local, national, and international industry leaders and policy makers dedicated to creating better communities.

 ULI’s mission is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide. ULI Washington carries out the ULI mission locally by sharing best practices, building consensus, and advancing solutions through educational programs and community outreach initiatives.

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