Value capture is the public recovery of a portion of increased property and other value created as a result of public infrastructure investment. Capturing a portion of that value to fund transit projects is an increasingly viable and desirable option. TCRP Research Report 190: Guide to Value Capture Financing for Public Transportation Projects is a resource for transit agencies, local governments, developers, and others interested in value capture as a strategy for funding and financing public transportation projects.
The guide will be relevant to many public transportation modes, including bus rapid transit, light rail, heavy rail, commuter rail, and intercity passenger rail.
TCRP Research Report 190 identifies the requirements necessary for
(1) successful value creation through transportation infrastructure investment and
(2) capturing a portion of that value through specific value capture mechanisms.
It emphasizes that value capture opportunities and strategies vary significantly due to context and addresses the conditions necessary for value capture, including:
- Real estate market vitality;
- Accommodative zoning, regulations, and land use entitlements;
- Statutory authority enabling use of value capture mechanisms;
- Articulation of compelling business cases of value capture to public and private partners and to the financial markets on which they depend;
- Development of project- and context-specific financial strategies that are feasible and that incentivize and reinforce value creation; and
- Institutional capacity on the part of transit agencies, local governments, developers, and other partners, working together to maximize value creation and value capture.
The guide conveys the importance of articulating the business case of value capture to a broad array of transit, public, and private stakeholders. The cornerstone of successful value capture implementation is the clear identification of the broader economic opportunity associated with
(1) transit projects and
(2) embracing a value capture strategy that optimizes benefits both for public and private partners.
The guide stresses the importance of building relationships with stakeholders and partnerships to help implement value capture strategies. From the perspective of local government, the business case for value capture rests on its ability to fund or finance elements of a transit project, municipal infrastructure, or other public needs. TCRP Research Report 190 includes six case studies that provide practical examples of successful value capture from public transportation investments and illustrate the principles presented in the guide.