It is not a new concept, but transit-oriented development (TOD) has become a sweeping trend, as evidenced by new projects being launched throughout the United States.
Congress has allocated billions to support the development of attractive residential and retail communities located near public transportation stations. The objective is to enhance the ease and convenience of using public transportation. Congress hopes to decrease the dependence on personal cars and foster developments that create walkable, bikeable, transit-supported communities that prioritize community well-being. This will help accomplish that goal, especially if the initiative includes affordable housing in an inviting community.
Data suggests that these types of developments, if successful, will increase public transportation ridership and make a significant contribution to reducing greenhouse gas emissions. This will help accomplish the federal government’s goal of accomplishing net-zero greenhouse emissions by 2050.
Economic development leaders see great benefits related to TOD developments because the projects attract business relocations, provide affordable housing, create jobs and immediately boost economic vitality. Funding is available for TOD developments through the Federal Transit Administration (FTA). Currently, $10.4 million is available for transit-oriented development planning efforts. Public officials have until July 22 of this year to apply for the funding.
Similar funding of $17.6 million was announced for successful applicants in 2023. The FTA will support 100% of a project’s planning cost when the project plans include affordable housing. Importantly, funding can be awarded to governmental entities or to private sector developers interested in launching TOD projects. This means that you, as a potential applicant, have the power to drive these projects forward. The only stipulation is that because the grant is for project planning work, applying entities must have land use planning authority. Applicants must also present an overview of their planning study for the proposed project, a work plan, schedule, budget, risk review and a mediation plan.
The Build America Bureau (BAB) also has new funding for transit-oriented development initiatives, which can be awarded to public officials or private entities. The Transportation Infrastructure Finance and Innovation Act (TIFIA) grants this funding as a loan. However, favorable loan conditions include low interest and a deferment period of up to five years after a project is completed. The repayment period can stretch up to 35 years. Public entities receiving a loan from this program must have a private sector partner willing to invest 20% or more in the project. The development must be physically connected to or within a half mile of a bus, rail or multimodal transit station, including passenger rail service.
TOD projects that create economic development may be awarded TIFIA funding if the developments are within walking distance of a fixed guideway transit station and the loans will cover a maximum of 33% of a project’s total cost.
The Build America Bureau (BAB) awarded its first loan for a transit-oriented development (TOD) project in May. The Mount Vernon Library Commons Project in Washington received $26.8 million from the TIFIA program and is already under construction.
Two other TOD projects are currently being considered for loans. The first is an apartment development in Boca Raton, Florida, and the second is the 2 World Trade Center project in Manhattan.
Another recipient, a transit-oriented road project planned by Placer County, California, in cooperation with Caltrans, qualifies as an upcoming opportunity. The project will be designed to provide access to public transportation, connect the community to the downtown commercial area, and improve safety. It will include a new roundabout to enhance the safety and mobility of all roadway users. Sidewalks and bike lanes will be added. When completed, the project will connect the community’s west side to the downtown core so residents can access the newly developed commercial area. Improvements will also be made to the stormwater management infrastructure to reduce pollution from runoff. The $14.2 million project is currently in the planning and design phase, and construction will launch in 2025 or early 2026.
Commissioners in Dekalb County, Georgia, have approved rezoning the Indian Creek rail station to support mixed-use transit-oriented development. This is also an upcoming opportunity that will need private-sector partners. The effort will be located on 64 acres, a high-density residential and commercial area that will prioritize affordability, parks, greenspaces and walkable areas. The objective will be to transform the area into a transit-oriented community with all residents located within a half mile of the bus transfer facility.
The development project will include a customer parking deck, a new 45,000-square-foot bus transfer facility and a Metropolitan Atlanta Rapid Transit Authority Police precinct. Other public facilities will be a 20,000-square-foot community center and 4 acres of parks. A greenspace will be designed for an expanded community farm, a walking and biking trail and multi-purpose recreation courts. Solicitation documents will be released soon after rezoning is completed.
Transit-oriented development projects will require contractors to deliver numerous types of products and services — construction, engineering, professional services, technology, landscaping, water and utility capabilities, roadwork and more. These types of transportation funding programs will undoubtedly provide attractive collaborative opportunities for public and private sector partners.
Photo courtesy of the city of Mount Vernon, Washington
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