Friday, December 09, 2005

The Virginia Chamber Weighs in

The Virginia Chamber of Commerce board of directors has issued a position statement on transportation reform in 2006 that endorses tolls, public-private partnerships, cash infusions from the General Fund and institutional reform. While stressing the urgency of the transportation "crisis," the Chamber did not advocate an increase in the motor fuels tax, and it endorsed Gov.-elect Tim Kaine's idea of passing a Constitutional Amendment to secure the Transportation Trust Fund from diversion to other uses.

Stated the Chamber: "Virginia’s transportation funding challenges have now reached crisis proportions and it is imperative that the 2006 General Assembly take effective action to create additional long term, sustainable revenue for all modes of transportation."

The Chamber called for "improved business practices for Virginia’s transportation agencies and the adoption of those private market solutions that hold real promise." It also stated that the Commonwealth "should not shrink" from re-engineering the Virginia Department of Transportation, the Commonwealth Transportation Board, and other institutions "to provide more flexibility and autonomy to regional leaders in a 21st century environment."

The Chamber backed "establishment of a financial foundation for the highway maintenance program. This foundation eliminates the need to divert ever-increasing funds from highway construction, mass transit and other programs, to expand mobility. Reallocating current sources of revenue from obsolete or ineffective programs to transportation needs may be desirable."

All options should be on the table, the Chamber statement said, including tolls, public-private transportation partnerships, congestion pricing, HOT lanes and "a thorough examination of thoughtful private industry solutions for maintenance, procurement, project management, traffic management and asset ownership in the transportation field."

But the Chamber also noted that Virginia's motor fuel tax is one of the lowest in the U.S. and "a great boon to Virginians and the many motorists from other states who use our highways. We should look first to other sources of revenue before considering raising this or other forms of taxation in the Commonwealth."

Pointedly, the statement made no mention of tying transportation to land use reform, one of Gov.-elect Kaine's other signature transportation initiatives.

See the full statement.


At 11:36 AM, Blogger Toomanytaxes said...

A quick read leads me to believe that the Chamber of Commerce still wants to have development be a win-lose situation since its statement ignores Tim Kaine's obvious inclusion of land use as a key component of the transportation program. Tim Kaine put the development issue on the table. Voters, especially in suburban areas, reacted very positively to Kaine's proposal. Those very same voters expect land use to be addressed as a part of any new legislation.
Doesn't this business as usual approach encourage many other groups to oppose the Chamber? Business as usual encourages those concerned with the impacts of development to fight for strong anti-growth restrictions, rather than work towards some more reasonable compromise.

At 12:33 PM, Blogger Bob Burke said...

Yeah, toomanytaxes, good question. Somebody - presumably our new governor - needs to lead these disparate groups to the table and make them deal.

At 8:24 PM, Blogger Ray Hyde said...

There is no likliehood whatsoever that an initiative as vague as tying land use to transportation will have any measurable effect on our current problems.

If that vague statement is ever translated into meaningful AND MEASURABLE goals, then maybe in fifty years we can accomplish something - if we can find a fair way to implement those goals and if we are willing to raise the money to fund the necessary incentives.

But don't expect to accomplish very much in any measurable lifetime. Is this worth doing over the long haul? Probably, but it needs a lot better slogan. And a lot more thought.

We know we are going to have two million more people, so anti-growth activists are doomed to fail - somewhere. Now the question is where,and under what circumstances. TMT doesn't want it to be in Fairfax, and PEC doesn't wan't it to be in Fauquier. If someone doesn't get the claimed stakeholders to the table and deal, then we all lose. If everyone goes to the table and fights to the death for their own silver bullet, we are doomed.

At 8:38 AM, Blogger Toomanytaxes said...

Ray Hyde: I don't think the tie between land use and transportation is that complicated. As I understand Tim Kaine's proposal, any application for rezoning or proposed amendment to a local Comprehensive Plan would first be required to have an analysis of its impact on existing transportation facilities. Projects that would have a significant negative impact on those facilities would not be approved. Presumably, however, the developer could elect to build by right (which would definitionally have a lesser impact on transportation) or proffer sufficient cash or improvements to mitigate the impacts.

For example, the owners of the Tysons Corner shopping center have previously filed for rezoning to build a number of high-rise condos and assorted office buildings. They have also submitted studies demonstrating that the project, when completed, would increase local traffic somewhere in the range of 4-5%+. (My recollection of the exact figures may not be correct.) Assuming the completeness and accuracy of the study, Fairfax County would not allow the project to go forward (that's still an awful lot more traffic). However, the developers could likely proffer sufficient cash and/or traffic improvements to return the local roads to the same condition of service that they would have been at without the new projects. Alternatively, Tysons Center's owners could build by right.

This concept seems to create the win-win situation that some of us, including you and me, are seeking. Developers can still build, while the public is held harmless. It also strikes me that this approach provides incentives for more efficient use of resources in the overall economy. Projects that contain sufficient protections for the rest of the community and can still be built profitably will be constructed. Those that cannot, will not.

At 6:56 PM, Blogger Ray Hyde said...

Part of the problem is revealed in your comment about local traffic and whether the study is accurate.

For the most part people are willing to travel up to around 45 minutes to go to work although there are many that drive much farther.

The link between land use and development is not one development and one location, necessarily. Queuing therory tells us that the queue goes to infinity if the service interval is longer than the arrival interval.

A 4 to 5% increase in traffic doesn't mean anything if the roads are currently operating at 80%. But a 1% increase means gridlock if you are operating at 99%.

Your example applies to one location. But suppose there are ten smaller developments located within 30 minutes of Tyson's and they all have a predilection for shopping there. Tyson's or some other bottleneck could see massive increases in traffic, yet none of the other developments by itself would trigger a problem.

This is the situation with Route 66. No single development is responsible for the crush of traffic that occurs around Glebe Road, instead it is a partial contribution of every development from Falls Church to Front Royal.

The question that has to be answered is what transportation facilities the project will affect. Then you have to decide what is a significant impact. Then you have to decide how large an area is affected. Then you have to decide how much secondary ripple effects will distrurb other traffic flows if one location fails. For example, if there is a problem on 66, then 50, and Braddock Road take a hit.

What you are suggesting is that builders indemnify every existing resident against negative effects. It won't be long before those affects are extended to schools, fire, parks, etc.

The effect of this will be sharply curtailed building and building occurring at much higher pricews as builders attempt to recover the costs of providing public infrastructure. And if they build infrastructure for their residents, how will we ensure that existing residents don't use it for free?

You can argue, as some do, that Tysons, Springfield Mall, Fair Lakes Mall, Montgomery Mall, etc etc are the new downtown shopping districts of burgeoning edge cities and they are responsible for a reduction of traffic in the former downtown shopping districts. Will the developers get a credit for reducing traffic elsewhere?

I don't see that this is simple at all.

Then there is the matter of building "by right". This is subject to some considerable discussion. Some land owners can build ten units to the acre "by right" and others are restricted to one unit per fifty acres. Some kind of obective value is going to have to be set on what is "by-right"

Those "by-rights" have proven to be much less of a right than say the right too worship as you please. There are plenty of examples where people had certain "by-rights" which were eliminated through down-zoning, new environmental or building regulations, or simply because someone else decided they didn't want to have to put up with the effects of more building.

When such things happen, those "by-rights" disappear without indemnification. This amounts to a new rule infavor of existing residents, whose position was gained without the negative effects that will be caused by the new rule.

If you want to hold the existing residents harmless, then you had better be willing to hold existing landowners harmless when their "by-rights" are refused, or reduced.

In my particular case, my "by-right" development at one time was one unit per two acres, and I would have had something like 200 "by-rights". Those were arbitrarily reduced to 15 or so, without compensation.

Subsequently, health problems in the family caused land to be sold. Far more land had to be sold because the by-rights had been reduced. As a result the farm is far smaller today than it might have been, and less able to compete.

At the same time the value of by-rights (and existing homes) has soared because of the scarcity induced by region wide reductions. Therefore the previous loss of the by-rights today represents what might have been an enormous sum of money.

Additionally, since then, the proposed proffers to use the remaining "by-rights" have gone from zero to some number considerably north of $30,000 apiece. All of this is so that my neighbors, near and far, can be held harmless.

Furthermore, the likeliehood is that at some point in time the large lots which were spun off earlier will be re-zoned for more density. One reason this will happen is because the value of the large properties are climbing beyond the point that anyone can afford them.

I have seen this happen before, on Martha's Vineyard. The old original landholders were restricted to selling large lots "to control development". Those lots were later allowed to be subdivided as the values soared. Today the billionaires are outbidding the millionaires, and the grandchildren of the founders are living in hovels.

I don't see this as a win-win, especially when those opposed to development gain more in property value than those that are prevented from building lose.

At 3:30 PM, Blogger Toomanytaxes said...

The "battles" between landowners and developers on one hand and many other citizens on the other can be viewed as a conflict between conflicting property rights. The former desire, not surprisingly, to obtain the best return from their property and to avoid the impositions of development restrictions or proffer demands. Many others take the opposite position: restrict development and demand & collect high proffers in order to protect their perceived value of their real properties and to avoid paying higher taxes (which clearly diminishes one's property) to pay for the infrastructure necessary to support the added development.

Is there a hierarchy of rights? If so, how are priorities determined? Does the Dillon rule somehow protect some rights (by restricting local government's powers) more than others? Is that fair? Does the Dillon rule deny equal protection of the law by restricting local government powers over land development? Does that make sense in an economy where intangible property (shares of stock, intellectual property, etc.) is more significant than real property?

I don't know the answers to these questions, but they are intriguing.

At 1:40 AM, Blogger Ray Hyde said...


At last, someone who recognizes the problem for what it is.

I own an acre and a half in Fairfax, that could easily become 15 town homes. What is now worth $1 million would be worth five to fifteen million or more.

But my neighbors, (including you) wouldn't like it. EMR would stand up and applaud.

Well, four million to fourteen million would go a long way to preserving my farm in Fauquier.

My farm in Fauquier is worth $1.5 million. Developed as five or ten acre lots it would be worth from 24 million to 17 million dollars: but my neighbors wouldn't like it.

Additionally, if i was allowed to make such a development, I would expect that my neighbors would also be allowed to make such a development. This would reduce the value of my (proposed) development considerably.

Through a matter of considerable extension, such a prospect would lower the prospective value of my home in Alexandria, and yours as well.

The lower costs for everybody's home would be offset by higher taxes for scattered infrastructure, except that people would prfer to live closer in, provide there was enough space.

What EMR and Jim Bacon prefer, would best be achieved by calling off the dogs.

Unfortunately, you would be subjected to more congestion, higher taxes, etc.......

Part of the loss might be offset by proffers. But no one knows what the proper values are, so you cannot make an argument one way or the other.


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