Financing Urban Transport Through Value Capture - Highway and Urban Environment - page 15

It is convenient to comment that in some cases negative externalities are
produced around the buildings close to the transport lines. It is important to differen-
tiate between the externalities produced by being close to a station and the ones
produced by being close to the transport line, especially when the line is at ground
level. The negative externalities are produced principally by noise, vibrations and
landscape affection, but nowadays due to new materials and new technology, these
negative effects can be minimized and are topics taken into account when designing
the infrastructure.
If the benefits produced by the infrastructure exist and can be accounted, it is
necessary to question to whom theses benefits belong to. It is true that a new trans-
port line provide a general benefit to the neighborhood but especially to the closest
buildings. This value capture could be used to fund part of the transport infrastruc-
ture construction, operation or maintenance in order to diminish the contribution of
public resources.
In the following part, some mechanisms used in different places are presented,
that contribute to transport infrastructure funding.
Case Studies
There are many examples of value-capture due to a transport infrastructure. We
discuss some of them in the following sections.
Los Angeles, California
To repay construction costs of the Los Angeles Metro Red Line, private businesses
located half or one third mile close to the station, contribute by an assessment rate.
This rate takes into account the benefited area, plus the last 3 years' delinquency
rates. Furthermore, the price is fixed, therefore properties, independently of the
type of business, pay the same for each square meter. It was a very long process to
establish this mechanism, faced a lot of resistance but nowadays this rate is equal
to the 9% total investment cost of this line [1] .
France
This country has established a public transport funding system known as “ Versement
Transport (VT) ”. It is a specific tax paid by public or private companies with more
than nine workers, located within a 10,000 habitant's urban transport perimeter.
This tax is used to fund either operational costs or new transport infrastructure. The
Urban Transport Authorities (AOTU) are in charge of establishing this tax as well
as the rate, with a maximum contemplated by the law [2] .