Thursday, June 30, 2005

Summer Vacations from Hell

Attention beach vacationers, you might want to avoid Interstate 64 between Williamsburg and Norfolk this weekend. The section of I-64 near the Williamsburg area has been named the second worst summer traffic bottleneck in America, according to a study by The Road Information Program (TRIP), American Automobile Association and the American Highway Users Alliance. The study ranked the Oregon Coast as the worst bottleneck in the country, with the Maryland/Delaware Shore and North Carolina's Outer Banks also falling in the Top 5.

“This is not a top 10 list that Virginia wants to be on this upcoming July 4 holiday and especially when we are planning a major celebration centered on the Jamestown settlement for 2007,” said Steve Haner, vice president of the Virginia Chamber of Commerce and steering committee coordinator of Virginians for Better Transportation (VBT). “And with no long-term funding available to help remedy Virginia’s transportation crisis, the situation will only get worse. It’s time to address these problems to better our quality of life and enhance Virginia’s reputation as a vacation destination.”

Public-Private Partnerships and Assumption of Risk

Finally, a transportation editorial in the (Newport News) Daily Press that I can agree with. The anonymous editorial reviews a series of mega-projects where cost estimates are escalating out of control, undermining the original justification for the projects. Two cases in point:
  • The Coalfields Expressway in Southwest Virginia: from $1.6 billion to $3.8 billion in four-and-a-half years.
  • The Northern Virginia Metrorail Extension to Tysons Corner: from $1.5 billion to $2.4 billion.

And, as a reminder of what can happen once these projects are built, the Daily Press takes note of the proposal by Australia-based Transurban to take over operation of the Pocahontas Parkway southeast of Richmond. Parkway bonds are looking shaky thanks to traffic projections that came in below forecasts. Transurban might be willing to bail out the project.

Common denominator: Each of these projects were initiated as a public-private partnership. (Thankfully, the Coalfields Expressway and Tysons Metro Extension have yet to be built.) Anyone who thinks that public-private partnerships are an easy way out of Virginia's transportation dilemma (as I once did) has to reconsider their position. Private companies pitching mega-transportation projects always use the most optimistic possible forecasts as a way to induce government into giving them huge consulting contracts to flesh out the project or, ultimately, to build and finance it. The trick is: Do they really believe the forecasts? There's an easy way to find out: Are they willing to invest their own money into the project and assume the risk that their projections might not pan out?

Public-private partnerships can be a part of the solution to Virginia's transportation woes -- but only if private investors are willing to shoulder a significant portion of the risk of the projects. State government cannot allow itself to play the patsy -- or taxpayers could be saddled with billions in debts.

Wednesday, June 29, 2005

Excess Capacity on the Woodrow Wilson Bridge

Maryland and Virginia have not figured out what to do with two of the 12 lanes planned for the new Woodrow Wilson Bridge now rising in the Potomac River. Under the deal that launched the project, the lanes must be used for carpools, trains or another form of transit, but the Washington Post says that state leaders have not talked about which to choose.

The lanes will serve as shoulders until a use is decided. Adds the Post: "The delay in deliberation has frustrated transit supporters, who fought to add the lanes and ensure that the bridge was strong enough to sustain trains, the type of transit they would like to see."

Let me get this straight. Virginia and Maryland are spending billions of dollars to build a bridge with "excess capacity"? This capacity will sit there under-utilized for... for how long?

HOT Lanes on Interstate 95

The Road to Ruin project has distributed an article about the proposal to convert HOV lanes in Northern Virginia to HOT lanes and extend them to Fredericksburg. Headline: Proposed I-95 HOT Lanes A Mixed Bag: They'd Pay Their Own Way but Inspire More Sprawl.

See the article here.

Tuesday, June 28, 2005

The Pocahontas Parkway Pickle

According to the Richmond Times-Dispatch, an Aussie conglomerate and Irish bank are interested in purchasing long-term rights to operate the 8.8-mile Pocahontas Parkway that runs around the southeastern quadrant of the Richmond metro region. Selling off the operating rights to Transurban (USA) Inc., of Australia, and DEPFA Bank Plc., based in Ireland, would allow the Pocahontas Parkway Association, the nonprofit corporation that operates the three-year-old highway, to pay off about $400 million in bonds and other debt.

Traffic projections have not met expectations. Although the Parkway has met its bond payments so far, there is sufficient uncertainty about the future that the investment rating of the bonds has been downgraded. I would be interested to know how Transurban proposed to make money from the project. By stimulating development in eastern Henrico, perhaps?

A strategy of stimulating more poll-paying traffic might help pay off Parkway bonds, but it could come back to bite Henrico County. The spread of scattered islands of development in sparsely eastern Henrico would be incredibly inefficient from the perspective of providing public services. More development would require Henrico (which builds and maintains its own secondary roads, not VDOT) to extend better roads, utilities, public safety and other public services to the area. If anyone has examined the financial implications of such growth, I have not seen it. I suspect that it will be much more expensive than encouraging in-fill development and re-development.

Monday, June 27, 2005

Community Development Authorities: The Key to Urban Redevelopment

The most under-appreciated story in Virginia today is the surge in urban redevelopment: from Arlington/Alexandria to Richmond, from Lynchburg to Hampton Roads. Developers are rediscovering the center city, and they're building or proposing an incredible range of higher-density, mixed-used developments. One reason is the increase in number of "empty nesters" who want to move from the suburbs back into the city, close to cultural amenities. Another is the increasing acceptance of the "Community Development Authority" as a financing tool.

The latest CDA proposal comes from Virginia Beach developers L.M. Sandler & Sons, who propose building New Port, a residential project of 1,600 single-family homes, townhouses and condominiums on a 208-acre on Greenwood Drive. The property needs new roads, sewers, water lines, sidewalks, streetlights and a refurbished school--something the city would be hard-pressed to finance itself.

New Port would cover the cost of installing public infrastructure by creating a CDA that issues 30-year bonds. The bonds would be repaid through a $50-a-month assessment on homeowners. That assessment will come on top of a homeowner’s association fee to pay for maintenance of the development’s public spaces and for amenities such as two pools, a fitness center and a clubhouse.

Down to the Nitty Gritty in Debate over Vienna Metro Station

As the Fairfax County board of supervisors figures how to squeeze a projected 500,000 people into a county of 1 million over the next 20 years, the debate is focusing on the Vienna metro station in Tysons Corner, surrounded by a vast commuter parking lot and relatively low-density development. If it makes sense to increase development density anywhere, it makes sense at a Metro stop. Supervisors are expected to consider a proposal by Pulte Homes this fall to build a high-density cluster of 2,250 housing units, plus offices and stores in the area.

Says this morning's Washington Post, "the county's goal is to shave by 47 percent the 1,356 rush-hour trips the project would generate if it were a traditional subdivision. For offices, the goal is 25 percent." The County is putting the onus on Pulte to achieve those objectives. The question raging now: Is that goal realistic? Can Pulte coax enough suburbanites out of their cars and onto trains, buses, ride sharing and sidewalks to cut car use nearly in half?

Pulte thinks it can meet the goals. Citizen groups are skeptical. We'll find out more later his week when transportation planners release their assessment of Pulte's plan.

Sunday, June 26, 2005

Uh, Oh, Estimates are Escalating for Metro Rail Extension

This from the Associated Press:

FAIRFAX, Va. -- Engineering companies developing the plan to extend Metrorail through Tysons Corner say the project will likely cost $2.4 million, 60 percent more than the previous estimate and far above the price reached in a carefully negotiated financing agreement. ...

Northern Virginia's government and civic leaders have made the project a top priority for the congested region. The project eventually would run 23 miles from west Falls Church through Dulles International Airport, but planners have split it into two phases, the first through Tysons.

Under the financing plan for the Tysons portion, which previously had been estimated to cost $1.5 billion, about half the money would come from the federal government, about one-quarter from Dulles Toll Road collections and other state revenue, and about one-quarter from commercial property owners along the train route, who have agreed to pay a special real estate tax.

Staunton: A City that Wants More School-Age Students

The city of Staunton is enjoying a residential revival, with 1,600 new residential units coming online. School administrators are excited because they are expecting 600 new students, bolstering the ranks of the declining school population -- only 2,610 last year.

The News Virginian quotes school superintendent Harry Lunsford: "We would actually welcome some additional students because it is difficult to budget each year for our state funding. We're anxious to see some positive growth and economic development that will hopefully attract some families with children."

Although the News Virginian doesn't say so, benefits accrue also to Augusta County, which is relieved of the pressure of accommodating those 1,600 additional units and 600 additions students. When you consider that Augusta Countyalso doesn't have to provide extra water, sewer, roads, police service, fire service, rescue service, etc., to serve these residents in scattered, low-density subdivisions, it's a win-win-win all around.

Moral of the story: It makes financial sense for public policy to encourage the infill and redevelopment of Virginia's older urban areas. Infill and redevelopment can't take all the pressure off Virginia's growth counties, but it can take off a lot.