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Getting Creative in Financing Regional Projects; Ballot Measures, P3s, Leveraging Properties Among Methods

Representatives of public transit agencies and businesses reported on P3s, regional programs and revenue-generating measures for infrastructure construction and system operation at an Annual Meeting session titled “Creative Funding and Finance Approaches with Public and Private ­Partners.”

The session featured two panels. The first focused on funding and financing, with presentations by Peter Rogoff, chief executive officer of Seattle’s Sound Transit; Michael Ford, chief executive officer, Regional Transit Authority of Southeast Michigan (RTA), Detroit; and Alice N. Bravo, director, Miami-Dade Department of Transportation and Public Works, and a member of the APTA Board of Directors.

Rogoff described the 25-year, $54 billion “Sound Transit 3 (ST3)” plan on the Nov. 8 ballot in the three counties served by the agency. If approved, ST3 will add 62 new miles of light rail, establish two BRT routes, expand capacity and service for Sounder commuter rail and provide for improvements in ST Express bus service, access and parking.

“We, like other megaregions, are growing faster than our transportation network can serve,” he said. “We’re seeing new and life-changing dynamics for the Pacific Northwest—what once was a 25-minute commute may now take 45 minutes on a good day.”

Funding would come from increases in motor-vehicle excise, property and sales taxes totaling $169 a year ($14 a month) per individual. The taxes would raise an estimated $27 billion, which would be combined with other state, federal and bond revenues.

Rogoff also spoke about other funding opportunities for ST3, including a P3 with BNSF regarding commuter rail and the potential for federal RRIF funds.

Ford’s agency also has a ballot issue this year, with voters in four counties considering a 1.2-mill property tax for BRT and a commuter rail line between Detroit and Ann Arbor.

He explained that the regional authority was established in 2012 and it serves four different transit operators in four counties with both urban and suburban populations. “We want to ­create synergy and connections among the four counties,” Ford said.

Ford said RTA will create a regional master plan that would fill in service gaps: developing BRT on major lines to transport workers to jobs, introducing service in areas that don’t currently have public transit, adding service to underserved regions and providing universal access with a regional farecard and paratransit.

Bravo spoke about how Miami had planned for service expansions in the 1990s that were never built, except for service to the airport. She emphasized the importance of P3, which she said can balance funding and risk between private and public sectors.

For example, she said, her agency is considering a P3 for building and operating CNG buses and garages that would generate revenue by selling fuel to certified non-transit fleets during off hours. The private partner would design, build, operate and maintain the fueling stations.

Bravo also noted that the system is considering a 30-year plan that would advance service along six corridors, including a streetcar to Miami Beach. “The strategic question is what to do first,” she said.

The second panel reported on alternative ways to generate revenues, including public transit commuter benefits, property management and private funding for station development.

Daniel Neuburger, president of ­WageWorks Inc., and Meltem Korkmazel, chief operating officer, commuter benefits solutions, for Edenred USA, reported on the “win-win-win” of public transit benefit programs. Employers who provide the benefit and employees who receive it save on taxes, and more transit use means fewer vehicles on the road and less greenhouse gases going into the environment.

Neuberger explained the concept of “price elasticity,” where changes in quantity relate to changes in price. Specifically, when the cost of public transit rises, ridership falls, and when costs decline, ridership tends to increase. Transit benefits help by reducing the effective fare price, he said.

Korkmazel called commuter benefits “an important, underused tool” that could be better promoted to commuters and, perhaps, schools.

Charles Di Maggio, chief operating officer and counsel, Greystone Management Solutions, said public transit agencies might find new revenues by rethinking the use of properties they already own. He cited the trend of transit systems working with private real estate firms for asset management and revenue development through repurposing, development or disposal.

Derrick Cheung, vice president of strategic sourcing and real estate for TransLink, New Westminster, BC, picked up on Di Maggio’s theme, saying transit agencies can work together with stakeholders to reap benefits.

For example, he said, population is growing around TransLink stations. The agency is working to facilitate TOD and transit-oriented communities, integrating development with the stations themselves and using private funds to rejuvenate public infrastructure. Developers of a privately funded station might partner with local government to build the neighborhood.

APTA board member Jeffrey D. Ensor, chair of the Public-Private Partnerships Committee and director, project delivery and finance, Maryland Transit Administration, served as moderator.

HNTB Corporation sponsored the session.

Public transit officials who presented funding and financing case studies at the session, from left: Alice Bravo, Michael Ford, Peter Rogoff and moderator Jeffrey Ensor. Reporting on alternative methods of revenue generation were, from left, Charles Di Maggio, Derrick Cheung and Meltem Korkmazel. Not shown is Daniel Neuberger, who presented with Korkmazel.

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