Wow! DC Streetcar could add $10-15 billion in value
|September 16, 2013||Posted by Staff under Archive, Book Reviews|
If a private person or firm gets the rent for land, nobody’s upset, it seems. Yet let government get the revenue on behalf of society, and suddenly it becomes controversial? Why is that? We trim, blend, and append three 2011 articles from: (1) New Urban Network, Apr 7, on DC, posted by Drew; (2) Haveeru Daily, Apr 16, on Male (Maldives); (3) and Shepheard-Walwyn Publishers, a book review by Anthony Werner.
by New Urban Network, by Haveeru Daily, and by Anthony Werner
Wow! Study says DC Streetcar could add $10-15 billion in value
The Washington DC streetcar, the first corridor of which is under construction, will be a 37-mile system. Expected to be completed by 2012, the streetcar would put 50% of households in DC near rail transit — from the 16% currently.
With an estimated cost of $1.5 billion, that looks like a good deal. It is expected to increase the value of nearby locations by $5-7 billion, according to a study by Goody Clancy & Associates of Boston.
Add to that an estimated $5-8 billion of new development over 10 years attracted by the streetcar, and the total increased property value is $10-15 billion. The tax portion from that total could pay off $600-$900 million in bonds for streetcar capital costs and related development.
Such figures are based on the increases in property value and development generated by smaller streetcar projects in Portland and Tampa, and light rail lines in Denver, Minneapolis-St. Paul, and Charlotte.,
In terms of taxpayers dollars, the streetcar offers a better ratio of benefits to costs compared to Bus Rapid Transit (BRT) or Light Transit. While BRT is less expensive to implement, it does not generate the real estate investments to the same degree that streetcars can. While light rail can produce similar benefits to streetcars, implementation costs are many times more than that of streetcar.
To see the whole article, click here.
JJS: While some talk about making some transportation infrastructure self-financing, another form elsewhere already is.
GMR hikes airport land rent by 50%
GMR, which won the bid to manage Male International Airport for 25 years last June 29, is to increase the rent they charge for the land they lease from the airport by 50%, commencing from next month.
In a statement, the company said the current rate of US$6 per square metre (about Rf77) would rise to US$9 per square metre (about Rf116) commencing from next month.
“The rate of US$6 per square metre was set 10 years ago and there have been no revision since. The proposed rate of US$9 per square metre will be applicable for all land leases,” the statement read.
Island Aviation Services Limited (IAS), which earlier provided many services at the airport, has to pay Rf8.4 million annually for the land leased from the airport. However, with the change in the rate, the rent has increased by Rf4.2 million to Rf12.6 million annually.
The GMR-MAHB consortium proposed to pay the airport US$78 million (almost Rf1 billion) upfront, one percent of the total profit in the first year (until 2014), and 10 percent of the profit from 2015 to 2035. It also agreed to pay 15 percent of fuel trade revenues in the first four years and 27 percent from 2015 to 2035.
JJS: If a private firm can recover socially-generated rents, why can’t society recover its own socially-generated rents? Ask the following author. He’s the guy who did the first study of Washington DC mass transit, which showed that the metro subway could have also paid for itself more than once. He has a new book out about making all social programs self-financing.
Land: Key Element in Treating Economic Issues
Re-solving the Economic Puzzle by Walter Rybeck points to land speculation as a prime cause of booms that inevitably lead to collapse. He writes that shifting taxes off production onto socially-created land values can take the profit out of speculation. This in turn will engender other beneficial results — abundant job opportunity, affordable housing, healthier and more compact cities, environmental protection through reduction of sprawl, and a more robust market system.
In this non-technical work, Rybeck takes readers on the intellectual journey that led to his focus on land issues. In Appalachia and as a Latin American correspondent, he saw grinding poverty amidst rich resources. In Dayton, Ohio, his editor, Walter Locke, said, “Nobody should be allowed to write about city problems until they’ve digested Progress and Poverty.” [by Henry George]
When Senator Paul H. Douglas of Illinois (known as “a winner of lost causes”) was named chair of a National Commission on Urban Problems, he chose Rybeck as his assistant director. Within a few weeks on the job, Rybeck learned that Douglas — a former professor and former president of the American Economics Association — was a devotee of Henry George.
Themes familiar to followers of Henry George, but all too unfamiliar to many mainstream economists, political leaders, and the general public, are developed in the book:
• The so-called housing bubble was not a housing bubble but a land price bubble.
• Infrastructure could be self-financing by recapturing the higher land values it creates.
• Cities and states, while crying poverty, are sitting on a treasure that is literally under their feet.
The looks to a brighter future. His success stories — descriptions of places in the United States and elsewhere that have adopted a degree of land value taxation — lend credence to the reform program he sets out in the conclusion of the book.
Order from Robert Schalkenbach Foundation, 90 John St., Ste. 501, New York NY 10038, 800-269-9555, info at schalkenbach.org or Amazon for $29.95.