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Ladies and gentlemen, thank you, are standing by. Welcome to the private sector contributions call. At this time all participants are in a listen only mode. Later we will conduct a Question and Answer session. Instructions will be given at that time. If you should require assistance during the call please press *0. I would now like to turn the conference over to your host. Please go ahead.
Thank you and good afternoon everybody. I would like to say thank you to the virtual peer exchange on private sector contributions. My name is Pepper and I will be facilitating the event today. Just to give you a quick orientation in the top left corner of the screen you will find the audio call in information. In the lower left screen is a chat box and you can ask questions during the webinar through that. We will also give you the opportunity to ask questions by pressing *1 on your phone. We will remind you of the right time to do that. If you have any technical difficulties you may send me a private message by clicking on the button in the upper right corner of the chat pod and you can select start chat with host. The webinar will run until 3:00 p.m. Eastern time. We will first hear from Jeff Price who is a transportation specialist with the office of human environment. And he will be followed by Sasha page, the moderator. He is from the advisory firm of IMG Rebel. I will pull up pictures of the presenters.
So Jeff Price will start things off. He serves on the FHWA. He is 25 years of experience and 25 years of consulting. He has held positions over the last 14 years in transit and railway.
Sasha page is with IMG Rebel. He has over 25 years of experience in transportation and other types of infrastructure. He is focused on hot how value capture tools can create infrastructure with the every day counts program in Boston, Chicago, and Raleigh-Durham.
Joshua what do fries will be presenting. He is the director of planning and senior planner with the Department of Transportation in Osceola County, Florida. He holds a Masters degree in urban and regional planning from the University of Florida. Mr. DeVries has been active with the planning Association since 2005 and is the past president of the Metro section of the ETA.
Our next presenter is the CREAT program manager with the FHWA Illinois Division. He serves on the freight advisory committee for the Illinois Department of transportation as well as the Metropolitan agency in the Chicago area. He joined FHWA in 2008. While in New York he worked on a bridge replacement project and upgraded New York route 17 and U.S. 15 and Interstate 86 in 1999, respectively. He graduated from the Polytechnic Institute with bachelors and Masters degrees.
Our last presenter today will be Josh Wheeler. He is a city engineer with the Oregon city, Oregon. Mr. Wheeler started his career in the private sector in design and moved into the public sector in 2008. He then became the public works director in 2011. In 2014, Josh became the public works director of Benton County, Oregon. In his public experience he worked with private development to make improvements to the public ways through a variety of methods through public and private partnerships and looking at how projects impact property owners. So we have great present or with varied experience a different aspects on the topic today.
We will be fielding questions for the presenters at the end. We will have time for additional Q&A at the end. The speaker presentation slides will be available for download on the left side of the screen at the end of the webinar. If you are interested it in applying for professional credit for your participation we will provide the information at the end of the presentation on how to get credit for your participation. Thank you, for bearing with me on this and I am now going to turn it over to Jeff price. I am pulling up your slides now Jeff.
Thank you, very much pepper. Also, thank you, for the opportunity. I am looking forward to hearing from presenters directly on this great peer exchange that will give you the opportunity to answer questions. I want to give you a review on why we are doing these value capture sessions and bringing the materials to you. Every day counts or EDC is a model that is proven to provide innovation. It allows our state to select innovations that meet their unique needs. To enhance safety and reduce congestion and improve environmental sustainability for the systems that they are managing and investing in. The Federal Highway administration or the FHWA is on the fifth round of EDC. Including value capture we are capitalizing on the value created by transportation. I invite you to get more information about "Every day counts" by visiting the link on the slide. Since value capture is part of the highway initiative, you know that we like to link our remarks to the safety of transportation system. The nationals highway system has a backlog of capital needs. You can see some of the information on the slide regarding congestion and those things. We do need to protect this critical network and improve the system and we think that value capture is an important part of that.
So what is Value Capture? It refers to a toolbox of strategies used by public agencies to share a portion of the increased property value created as a result of public and structure infrastructure. Let's get into more of the importance of Value Capture. It provides alternative funding to supplement traditional sources. Value Capture can allow the direct beneficiaries of the transportation infrastructure to contribute to its cost. Value capture can provide much needed funding for matching share to state and federal grants. They can also help speed up project delivery. I have more information on Value Capture. And I want to make sure that you are aware of some of the resources that we have an the federal highway Value Capture websites. In an addition to this webinar series we have the implementation guidebook itself. And I believe, on the web links to the left of the screen you will see the every day counts and the opportunity to register for the Value Capture. Exchange. Please visit those pages and review any of those webinars. It is a great resource. For the event today, this is a virtual workshop and you can actually access recordings of the first two on that page for the virtual exchanges. So, adapting to the time that we are in to provide you with this information and I want to invite you to feel free to contact us if you have ideas for our program and areas where we can look forward and get help from our partners. Just a summary here of the Value Capture techniques. Today we are talking about developer contributions. The umbrella and special assessment fees and growth. Development, concessions and advertising in naming rights. Now back to today. We look forward to hearing from our speakers but remember we want questions and dialogue from you. So please get them ready. To summarize, infrastructure improvements create value. Public land adjacent to roads and bridges. This includes transit, bicycle and pedestrian facilities and more. These projects can help communities with economic development initiatives to create vibrant communities. We realize that creating vibrant communities comes from a number of projects and each has to be developed one by one. Finally, Value Capture sets powerful funding tools that can help address funding gaps. It can help accelerate project delivery, which we are always working on the conception, planning, and operational maintenance. The USDOT and Federal Highway Administration support the Value Capture concept. Please reach out to us if you have any input on how our programs can help you. That is my quick introduction to Value Capture. I will let pepper take it away from here. Thank you.
Thank you, Jeff. Thank you for giving everyone an idea of how FHWA is promoting Value Capture. I am now pulling up the slides for Sasha and he will talk about building or contributions. Take it away Sasha.
Thank you, pepper and to all of you attending this session. I do want to remind you that as pepper said, if you have comments that you want to raise please put them in the chat box in the lower left and we will do our best to respond during the presentation or afterwards and we encourage others in the presentation to respond if you have thoughts about what has been asked. Please go ahead and use the chat box. I am going to provide you a brief bit of information on developer contributions or DCs. The developer contributions are private contributions from developers covering infrastructure cost. They are important funding sources for new projects. We will take a look out how they are defined, the calculations, some of the legal issues that they create and help talk about two special types of DCs. That includes voluntary contributions. The most common type of Developer Contributions are known by many terms. In some areas they are known as mobility fees. Josh will call them system development charges. They are also called facility fees, transportation concurrency fees and etc. These are for new upfront capital to pay for new infrastructure. There are two general ways that they are calculated. What is what we call the inductive method. That is where the community identifies capacity and cost of a generic facility, such as a road Lane. These are also used for wastewater and utilities in a similar way. Through this method we use this to calculate the cost of expanding infrastructure. So new population or commercial square footage creates a need for additional pain capacity. That needs to pay its pro rata share. The next looks at a master developer plan like a large subdivision. They determine what the actual infrastructure will be and then they distribute that across the property. That is the cost for the creation and the materials. This is a method that generally requires more data and is primarily for large projects. The way that these calculations are done is really based on peak hour trips. What I want to show in this slide here is that it is very important to understand that impact fees are for new infrastructure. It cannot be used to fund the existing infrastructure or other community needs. It is to build new infrastructure. So it is very frequent, as in Oregon Developer Contributions to that they have two different fees. One is to reimburse the men as the polity for the use of capacity that is available that is being used by the new development. And the improvement fee is for the improvement to the community. So the link capacity is the reimbursement fee. If you have to add an additional lane that is where the improvement fee comes in. In 2018, it was about over $18,000 in this example. The way that the peak hour trip rate is set is based on the Institute of transportation engineer trip generation manual. It identifies the trips generated high different land uses, in general based on what the counts create. In this case, of Kennewick, Washington the impact fee is around $1004. -- $1381. The ITE also provides other properties that generate peak hour trips and there are many more here. For example, a nursing home generation is based on the number of beds that they have. Very frequently it is based on the gross square footage of the facility. So these are tables, this information is publicly available on many websites. You can go to this and figure out what the impact fee is going to be relative to understand and work with. Impact fees, once they are set up are straightforward to administer and they are paid one time. They are enforced by the fact that the developer cannot get their occupancy permit until they pay that fee. Those are used for capital expenses but some allow that to be used for repair and replacement of existing facilities but that's rare. The management of the funds is that they are segregated into a separate fund only for new infrastructure. It is important to understand this because there have been a number of legal challenges to impact fees. Most states have impact fee legislation and they usually lay that out. They have to be reasonably related to the cost of the project provided. Without impact fees, it makes some areas look more attractive -- and the benefit that is being created and that has to be charged for the development and it has to be calculated roughly in proportion to their impact. That was shown in the previous example. Let's take a look at a couple of other contributions. One is called a negotiated exaction. Not unlike an impact fee but they are administered on an ad hoc basis. If a developer wants to build higher, and the request change to the zoning or land use and in return for that they negotiate with the community and provide something in kind. Whether it is a one-time land transfer, cash payments and also daycare facilities that are produced often times by the developer. These require sophisticated negotiations. A similar type is considered a voluntary contribution. There are benefits to the property and they take a long-term view look at the benefit to the property. Based on current and future development. There is a picture in this example of the Atlantic Station project in Atlanta, Georgia. This links that project across I-35 and the court or and it provides facilities for cars, bikes and pedestrians. This was funded at over $6 million and a good portion of that was funded by the developer because they felt it was in their best interest. Here are some takeaways that we can look at this for. The calculations have to be very accurate and appropriate. The administration of these fees is straightforward and they need to be put in segregated funds. It is very important to make sure that legal issues are understood and due diligence is carried out. You don't want to burden new infrastructure with the ills of existing infrastructure. Generally the communities that follow the legal rules will not have problems with legal challenges but there could be disagreements about the impact fee. Negotiation exaction requires real estate know how to work with developers. With voluntary contributions, they will be provided if the long-term view meets the developers view of the opportunities after making the investment. One thing I would like to emphasize is that these contributions don't cover maintenance costs. We touched on that previously when we talked about transportation utility fees. In the future we will talk about this further. This is one piece of providing infrastructure but not the only one. There have been examples where financial markets have accepted impact fees as a funding source but generally it is not very common. The concern on Wall Street is that these are one-time contributions and well a community may have a future projection of impact fees, there is always a chance that could diminish through a recession. So generally the impact fees are not financed directly. There may be a secondary backup. I would like to end right now. If there are any questions I would be happy to take them but I think we want to move on to our other speakers now.
There was a question about how impact fees can impact sprawl. Also, our speaker Joshua could have some insight.
I think I will look at that afterwards. It really depends on the policy of the community. Obviously the community can set of element plans and within that, so they want 70 units. The use could be multifamily homes and etc. They, themselves, they might reflect a whiter policy. They should reflect that in terms of the level fees. Maybe there are higher fees for single-family homes and there are for multifamily homes. But it needs to be clear it is the impact of those fees. It cannot be punitive. They really have to reflect the true impact of those uses. And Joshua, please take yourself off mute if you want to add anything to what Joshua had to say.
Absolutely. We have a couple of different opportunities to help reduce the level of sprawl and protect the environment. We are quite a large County and about two thirds of it is agricultural and environmental conservation uses. So, the land-use has established an urban growth plan and our growth is very limited. And as far as, mobility fees, there is, there is straight up regular mobility fees that everyone pays and there is also discounts for developments in mixed-use areas. And also, there is discounts for development that is within half a mile of commuter stations [ Indiscernible - muffled ] so those are a couple of ways that Osceola focuses on development for higher density intensity in certain locations while preserving the environment.
Thank you, Joshua. Sasha, we can table the other questions or do a couple more. I think we should. Quickly, there are a couple I can quickly answer. One is about the tool used for use or trips. The use of roadways is a common example. Bike path can also be used as a capacity issue. And maybe Josh can comment on that as well in Oregon City.
Thank you. We had a question about the guidebook for connectivity. And I am trying to [ Indiscernible - muffled ] the population of Cleveland, but the metropolitan area is -- if you have developers looking at the cost for the ethernet footprint [ Indiscernible - muffled ] just a more abstract idea of how we look at sprawl.
Thank you, Stefan. He is also a team lead from Value Capture and involved in Every Day Counts. I have hold up the slides for Joshua DeVries now.
Good afternoon. My name is Joshua what 57. I am a transportation planner for Osceola County. I also have an assistant as well. The first one is a cluster development study from May 2009. The study analyzed impacts of a development and how it would impact Osceola County. It is known as medical city and is a major expansion of Orlando, Florida. It is a 650-acre area. It would have over 500 square feet of retail space. The project total number over the next 10 years in medical Sunday center is -- with an economic impact of [ Indiscernible - muffled ] billion. Is the actual 2009 update of the transportation office zones. This was a breakdown of geographic areas to show where people are and where they are going to. It added several new areas for activity patterns and how it was handled differently in the past. What these projects showed is that we had to start thinking differently about how we would fund transportation projects or we would have a big traffic jam. In 2011 we began the process of the transportation element update. We shifted away from concurrency and moved towards plans that recognized gross as a powerful market force that must be harnessed and adapted. This included a transportation funding study that looked at innovative funding mechanisms, exhausting sources and [ Indiscernible - muffled ] operational plan. The calculation is not only by vehicle trips but also, there are several pieces of the pie. It is looking at converting trips into personnel trips. This is part of the mobility fee ordinance that was adopted in 2013 and subsequent revisions. At the same time, there were major changes identified. In the mixed-use districts. They wanted to one guide railway and transportation patterns. The use of Lake Tahoe and the East district. There was also land development revisions which created the requirements of different types of population density. These are the mixed use districts developed to the standard that is being -- [ Indiscernible - muffled ] . There are a number of transportation funding strategies. The mobility fee is broken down by East and West districts. These funds could be sent on these projects but the transportation needs in Osceola County are being analyzed and how they would be utilized. You can see almost $93 million and out of that there is about $40,000 in mobility fees. And a breakdown of that, approximately $93 million, this is a breakdown. Much of it goes towards roads but there is also a lot of other areas it goes towards. In additional, we are allowed to adjust the mobility fee to reflect changes in the national Highway index. We adjusted the mobility fee rates in 2018 that reflect what it costs to build roadways. We continue to do that annually. The county mobility fee ordinance is a public and private partnership. These innovative agreements allow for construction of County obligated framework of major roadways through coordination with the development community as it progresses. This calls for major roadways to be --. And that benefits -- [ Indiscernible - muffled ] -- transportation options within the county. Since the adoption of the mobility fee ordinance, we have come up with agreements. We have achieved $25.92 million of right-of-way dedication and roadway construction without county funds. We also have expedited the construction of multimodal transportation network with private land development. We do have options of case studies we will go through. Orange Avenue is one of the cases that we started before. It is a connector framework roadway. So this is Orange Avenue here. It is between Osceola Parkway and goes through the transit oriented development sun rail. So that would be right here. This is the, this is where our transit station is and there is development going in. This is improvement to the roadway. This is a shot from Google streets and there are apartments going in. There is also economic development here. This is a shot looking into the station and there is the development plan around this station that will improve -- [ Indiscernible - muffled ] it -- further improve roadways in the district. This is the cross Prairie Parkway. We wanted to create a connector from the Turnpike South. You can see this year. This is the east of Lake Tahoe conceptual plan. You can see it will come through here and continue south off the map. There is a large lake and it would go all the way around and make a large framework connection and then comes up north and goes through this connection and then connects up to the Turnpike just off the map. That is just a view of the street that is there and the Turnpike that I mentioned. This connector framework was created by developers as a connection between a U.S. 192 and Avalon connected to Ronald Reagan Parkway in Polk County providing a parallel facility to U.S. 27. It creates a connection between the three counties and up parallel facility for a large U.S. Highway. Another one is East Nolte Road. This is a shot from Google streets. This is what the improved section looks like. These are just world sections and this is unlike extension roadway to U.S. 192 East of the highway and it is a connection between the turn by Turnpike and East 192. And than this is Cyrils. On the left-hand side you see the existing Cyrils drive. There is a lot of development going on because it just north of this, which would be this way, is about 15 miles or so and this is a large development. It is a conceptual framework to create a connection between Mark Lucy Road and the Northeast District. A conceptual master plan and future limited access expressway Beltway circulating traffic around the Osceola County to various neighborhoods. And then this is Storey Creek Boulevard. This was created to create a connection between was until road and ham Brown Road. This is correlating with a developer to complete the connection and this is what the current portion looks like that is constructed. That will continue on to the parallel facility of 17 and that runs along this corridor here. And then, this is Neptune Road and this is a great way we can use the mobility fees. We are working on a widening project for Neptune Road. That allows the collection of fees for building permits. These are then spent on transportation projects within the fee district. This roadway was over $65 million to construct. And it connects cities within our counties. Travel times have doubled within recent years and this to -- this four-lane widening is part of this road right here and goes to US192. We are finishing the PD&E study for the widening, rehabilitation and reconstruction of Neptune Road. Designing and consulting have negotiations underway. They are looking at the beginning portions of design. The construction is expected to begin the fall of 2022. -- 2021. And completed in 2022. And we also have a website that can be referred to for this project. I appreciate everybody listening to me and I am open to any questions that you have about Osceola County, mobility fees or related issues.
Thank you, Joshua and Tawny, for that. I think there is a question in the chat room about, Dave asks, who is responsible for purchasing the right-of-way for the roadways and then who maintains those new roads? Maybe you can elaborate on that because I would like to know if that is part of the developer agreement that you mentioned Joshua. Until you negotiate those. Maybe you can elaborate on that. Yes. It is just like projects on one of those last slides. Or a developer agreement. So we talked about the roadway is owned by the county. So, what it is, it is essentially a capital improvement and it is a capital agreement by a developer. We look at what a developer is required to do and what their minimum requirements are under the development code. And then we look at what the ultimate goal is for the comprehensive plan for that roadway. And then we coordinate with the developer on what is actually creditable. And then they get credits for that the additional right-of-way dedication as well as the design and construction of the roadway.
Before, before I address the question from Stephen Tocknell. I would like to ask the operator what the call in number is.
The call in number is 323-794-2079. And the participant password is 379169.
Pepper, I think we are looking for clarity on if somebody wants to ask a question I believe it's just *1 -- is that right?
That is correct. If you would like to ask a question signaled by pressing *1. If you are on a speakerphone please make sure your commute is turned off. A voice prompt on the phone line will tell you when your line is open. Again, press *1 to ask a question. We will pause for just a moment to allow everybody to signal for a question.
Would you like me to answer the question about the NIMBY.
So there have been a number of projects that have had mobility fees that are partially funded through -- through mobility fees. So Neptune Road is the first project that will be funded with mobility fees. That one, going through the PD&E process, the only complaints that we got is why this had not been done sooner. Because it is a very busy roadway. There are conflict points that we are going to address with the widening and there will be two 12 foot bike paths as well as multi use footpaths. It was actually a very welcomed roadway improvement. I can't think of any other, any other issues related to these fees.
Okay. Thank you. Just to look at the time, I think we will now turn to a different mode. This is rail which is also a compelling project and we have Michael Kowalczyk.
Speculum. My name is Michael Kowalczyk. I am the CREATE program manager. Chicago is the rail hub of America. It trains from the West Coast take approximately two days to reach Chicago. Prior to CREATE it took it two days to get through Chicago. Then the blizzard happen. It took railway operations almost 6 months to return to normal. When I became the manager of CREATE, I was there at the beginning. After her visiting my grandparents in Chicago over the holidays, we took a train back to the West Coast. We were delayed by six hours and we were the last mode of transportation out of Chicago after flights were grounded. After that, the CT CO was created and that determines which trains have priority. Whenever I give this presentation I always start with this slide. It speaks to the heart of the landmark CREATE partnership between the U.S. D.O.T., the Chicago D.O.T., Cook County, six of the seven major railways in the country, the Association of American railroads and Amtrak. In 2003, the CREATE is ace $4.6 billion public-private partnership to design and improve transportation flow through Chicago. It focuses on increasing capacity, safety, speed and reliability for the system. As you can see, one of our completed projects separates Metro trains from freight trains. And then above, that is the 71st Street project in Chicago and that is a crossing that we are working on the final design of right now to separate the railway from the road. This program is classified by multiple corridors. Passenger, Beltway, East-West and Western Avenue. There are 25 road and real grade projects scattered throughout Chicago. I want to draw your attention to the fact that most of these projects are located on the south side of Chicago. This section of Chicago has a very high minority population as well as a high population that is below the poverty line. The improvement program has focused on 62 locations, 62 viaduct locations. This project has improved roadways, sidewalks, drainage under the viaduct. It has enhanced safety and security for pedestrians, bicyclists and motorists in these underserved communities. This slide gives a visual representation of the status of these 70 projects. Four in construction and six are in final design. 11 are in the environmental review process and 11 have not yet been funded. In the upper right is a signal improvement project along the western corridor. In the lower right, a road and rail grade separation at 138th and Torrance Avenue is shown. And then she is 19 project is in final design to grade separate the railroad from the road and that is in the bottom left. This slide gives another visual representation of the status of the program. Note that the major upticks in the number of projects aligned with the projects with the national and regional significance funding and subsequent successful --. The safety funding was secured in 2005. Chicago has always been a rail hub in the United States and one of the objectives of CREATE is to keep it that way. One quarter of all U.S. railway traffic goes through Chicago. And in recent years, Chicago has become a main port with almost 50% of all intermodal units owing through Chicago. A lot of the dust flows through Chicago. This shows how important it was in the infrastructure for rebuilding America grant. In the late 1800s and early 1900s the Chicago rail network allowed the city to become the stockyard of America. As the stockyard moved out over the years that land redeveloped into an inland container port. You can compare the number of container lives in Chicago done by LA and Long Beach. Of that number has increased with the number of transportation distribution and logistics companies that have added warehouse space in Chicagoland. I will take credit for these photos. Whenever you fly to the East Coast from Midway fly on the left side of the plane and you can see some of the intermodal yards and the enormous BRC clearing yard in Bedford Park. Completion of these 70 projects yielded a benefit of $31.5 billion to the Region. CREATE has significant benefits to the area and that includes economic growth. It also has significant benefits to the public in terms of a commuter rails, intercity rail and the reduction of traffic congestion at railway crossings. It also improves air quality, reduces emissions by reducing the amount of time delayed locomotives and cars spend idling in communities. It also has benefit to emergency services that are not connected to a downed crossing gate. Here are some of the CREATE benefits. You can see passenger train, you see truck delay reduction and you see vehicle crashes avoided with those separation projects. You see benefits to the freight railway network by getting the extra change trains through Chicago annually and then you see the movement of freight off the highways and onto railways. So how is this partnership documented? It is documented through the original joint statement. Following the 1999 blizzard they could not allow the daily terminal to be impacted again. The original stakeholders signed a corridor program into existence at a cost of $1.53 billion. The railroads contributed $232 million to the cost initially. They are nine overarching principles. They are improving safety, reducing conflict between the railway corridors, reducing emissions and fuel consumption, limiting the growth of traffic congestion, rerouting freight traffic and inner-city, modernize and increase the capacity of railway facilities, connect railways better within and through the Region and then ultimately improve the efficiency and reliability of the corridors to serve national security. There have been four subsequent amendments to the memo of understanding. It stated that the CREATE will seek changes meet requirements to protect federal funding. So if there are changes during the project they want to protect that federal investment. Amtrak was added as a participating railroad in the create partnership. These are two of the completed projects. On the left, GS 14 is a great separation near the Toyota Park soccer station. They added nice concrete soccer balls for context. And we have one from Metra and one from the freight trains. Before doing this they had significant delays because of gates being down four times. Amendment number three clarified the partnership, financial contributions along with prioritization of projects the most recent one, amendment number four, Cook County committed $78 million in funding to the CREATE program. Could County would now be reflected in governance structure of the CREATE program. This governance structure clearly lays out the responsibilities of the CREATE program. This slide gives the current CREATE commitments. It is the leveraging of federal dollars with public money and especially the railroad contributions. This will be critical when we discuss the cornerstone project of the create program. The largest CREATE project is the 75th Street corridor improvement project. These four projects are located virtually in the middle of the Chicago network and they aim to remove the biggest railway chokepoint in the network and one of the top railway chokepoints in the country. This rail interlocking that you see can only accommodate one train through it at one time. And due to train movements to the east it is the equivalent of two interstates meeting at a four way stop. Untangling this railway bottleneck will CREATE great benefit. Remember that Chicago protocol where passenger rail has priority during the morning and evening rush? This will also provide additional benefits from the 75th Street area. This will have a passenger railway footprint. You can see the yellow movement of the passenger rail. There will be public benefits from the road and rail separation. The addition of noise walls and improvements to the existing Vitamix, sidewalks and construction and on-the-job training proud projects will all benefit the community as well. Here is the breakdown from the 71st Street project. All of the grants were submitted on the website and if you are curious to look at how the CREATE program evolved in this world by leveraging public and private dollars, please feel free to check this out. Their request was for $160 million in federal funding to leverage $474 million for the final construction of the first half of that billion dollars 75th Street project. This is a long way from the 90-10 split or 20-80s but back in the federal highway days. In addition to the leveraging of public dollars, it is important to have a cost analysis leveraging grants. Follow the D.O.T. guidance and be very clear about how you arrived at your BCA. The CREATE partners were not awarded the full $160 million we requested. We were awarded $132 million for the construction of be nine B9. Even though they did not --. The final design is progressing to date. This strategic action was taken so that once final design is complete we will be ready to proceed right to construction and not spend two years in final design when we seek to secure a federal dollars for those other projects. Thank you, very much for your time. I can take some questions now and feel free to use these resources or reach out to me if you have questions at a later date.
Thank you, Michael. I just want to remind those attending that you may press star one to call in. I am going to read three questions Michael and then you can restoring to them. The first is, how does the government structure CREATE work and practice? What if any governance policies and procedures do you have in place? Sean Irvin asked if this is a different topic, related to showing values, do you have a copy of how you constructed your TAMS for the railway and next, how much -- was put into CREATE and what lessons from CREATE could help to advance the gateway heads and revel River tunnel project.
I will try to go quickly. So, for Craig, here is the slide that basically states the railroads have committed, up to the date, $375 million. We are right at about $1.6 billion and the program is at about $4.6 billion. It is with everyone's anticipation that all of the contributions from those pots of money need to go up to meet that $4.6 million number. So to date, $375 million but that needs to go up in the future.
In terms of the government structure and CREATE, having been in the program over four years, it functions very well. Everybody knows their roles and responsibilities. Stakeholders include SCDOT and IDOT. The federal highway, they are a member of the management committee. We help with basically adhering to federal rules and regulations. Back when the CREATE program was started, it was seen as an implemented implementing agency and that is why FHWA is not the leading agency. FRA got involved in the federal highway basically set up, along with all of these partners, they CREATE policies and procedures. So we brought them out into phase I, phase II and phase 3. And then basically, that led to preliminary engineering. Phase 2 was a final design and construction was phase 3. So we have flowcharts and a lot of different policies and procedures and those can all be found on our website as well as the IDOT website. So let me know if I satisfied that question.
And then, Shawn, in the world of acronyms, help me out with TAMS. I am assuming maybe transportation asset management? If I am guessing wrong -- okay so federal dollars go into the initial capital project. It's these projects are built, whether they are a grade separation or a railroad only project. In grade separation you think of railway over road or rail over rail or a regular signal project or any sort of rail only project in terms of better switches and signals. All of those maintenance responsibilities fall to the railroads. So, federal dollars are not used in maintenance of these projects. So the railroads assume all maintenance responsibilities and that is a known commodity within the CREATE program. The railway improvements fall to IDOT for them to maintain. So for the purposes of maintenance federal dollars stay out of that. We build the capital project and then those need to be maintained in accordance with U.S. code.
Lessons -- what lessons from CREATE could help advance the gateway heads and River tunnel project? It came from a strong push and then everybody understanding what the creative objections are. I note there is a significant amount of money and CREATE is a significant amount of money as well. CREATE is really focused on making sure that policies and procedures are in place and making sure that everybody has a seat at the table and making sure that we strategically use federal dollars and all of our limited dollars to move projects forward. Again, breaking those down into smaller bites, we have stage constructed some projects. I know a little bit about the Hudson River tunnel project but I'm not going to talk about working it down into smaller projects. But that really is what we do every day in implementation. Trying to figure out how we can extend our dollars further not only for the freight rail and the passenger rail but also for the local community and the traveling public. And then, what level of effort was needed to bring private barreled to the table and provide funding? Well, this blizzard was kind of that catalyst moment. What really ended up happening is the mayor basically sat down and figured out, private railway is going to go elsewhere if there is an impediment in Chicago. That blizzard really brought that to the forefront. And they said that freight railways needed to sit down and work together. When freight rail and passenger rail enter, everybody is treated equally. The NSF is not treated any differently than any other railway. So everybody's set down and they said to continue keeping Chicago on the map as a rail transit hub they needed to come together and form this partnership. So again, it was originally $1.5 billion and they figured out the adequate split from the railroads and that was that we hundred $32 million. And we subsequently had to move up as the projects continue to cost more and more. Hopefully I hit everyone's question at least somewhat. If not, please reach out to me. And now, Josh.
Josh, what you jump in here.
Okay. I am noticing I don't have presenter control anymore so you may need to advance the slides for me. I am going to give you information on the transportation funding in Developer Contributions to. -- Oregon City. I noticed that some people use general funds for their transportation and in the state of Oregon that is not allowed. Federal fund typically has things like hotel taxes, property taxes, income taxes. Those cannot be used for transportation. The only thing that can be used for transportation funding is gas tax, system development charges or pavement maintenance utility funding. So those are the three that we use in Oregon City. We use all three of those and we will get into the details of each. The gas tax in Oregon, we have a separate gas tax from the federal gas tax. That was increased with house built 2017. It is called keep Oregon moving. We are currently at $.36 per gallon. The chart on the right shows that we did an initial increase of four cents and every two years we increase it by two cents. The reason those two sent increases are in red, is meeting accountability requirements. Those accountability standards are things like delivering projects and performance standards. In Oregon cities and counties can implement their own gas tax but we have not yet done that. Oregon coastal cities do and they have a seasonal gas tax that is only used during the tourist months. Nobody really goes there during the winter so the gas tax is really geared towards the tourists. The one thing I did not mention here is license and registration fees can also be used. The state ones, are to a degree. Oregon City is implementing a license and registration fee it will be applied towards transportation maintenance. Also with that house bill, biking is very big in Oregon. And so now there is a $15 fee on new adult bicycles that cost $200 or more that will ultimately generate $1.2 million that will be used for grant programming for walking and biking paths. Also the house bill has a payroll tax that is used to assist with the funding of public transportation, which is also fairly large in Oregon. We use this towards the gas text towards employee salaries, maintenance and that means like pothole patching & replacement. As well as vegetation maintenance. Equipment purchases for all of the things and supplies that we need. So, going to the second type of transportation funding, that is system development charges or we call them SDCs. We have those through authorize Oregon statute 223.302. And that authorizes us to be able to use that but then we have to implement our own programs with our own funding calculations and so then we go through a process of analyzing how much funding we need, how much we can split that up between developments and then based on trips, what should it be and then we up a that every so often based on a plan that we create. There are three components to SDCs. It is vehicle, bicycle/pedestrian and then we have the bicycle/pedestrian general. The way we can use our SDCs are eligible capital projects. That is part of the transportation system plan and we have to add capacity to use that funding. So we cannot use that for a resurfaced project. We can use them for a widening project or a new road or a brand-new sidewalk or a brand-new bike path. But we cannot use it to maintain those items. Projects that we have used them on, one is called Meyers Road and that connects a state and local highway. They create routes to a park and the high school. It is important to create new jobs in the city. That was 100% SDC funded. That is about a one mile long project. Molalla Avenue is another project that is just getting started. It is a $13.5 million project in 3.8 million of that is transportation SDCs. We are able to use the gas tax for the maintenance portions of that. And we use the payment maintenance utility fund. We can also use utility funds for some of the utility projects we are doing on that road as well. But it is basically a widening project that includes new bike paths and widened sidewalks. So that is how we can use some of the SDCs. The funding for SDCs is based on the ITE manual that was mentioned earlier in presentations. Basically, just to get a sense of what kind of revenue that is bringing in. A single-family residence is charged over $11,000 per house for transportation SDC alone. We have water, storm water, parks. You can see that a single-family residence is made up of about 8800 in vehicle, 576 in the bicycle/pedestrian general and 1751 of the bicycle/pedestrian residential. Until we do a new resolution, we are able to increase that approximately 3% annually. All of our fees are allowed to raise annually without any major requirement for approval from the city Council or we call it the city commission. There are discounts that are available. Credits are available when, let's say, a single-family house is on a piece of property and they choose to demolish that and put up a new shopping center. You get credit for that existing house that was there. We also have reimbursements. So, for example, if a private development who is paying SDCs, if they are needing to put a new road in, we need to make them to an arterial level, then they get reimbursed the difference. Or if for some reason they need to build an off-site road to connect to their development then we also give them reimbursements for that as well. We have a location-based discount and I will show you that. There is also a shopping center discount there are five areas that we consider shopping centers. We expect it fewer trips than the normal to those areas and then we give them that shopping discount. These are the discount areas in our urban corridors. The picture on the left is the main Street downtown areas. The picture on the right is Wallace Street and that is a corridor that goes up to the end of the city. These are heavily commercial corridors and we expect much more walking and pedestrian and shared trips as well as bus trips. That is why we give those businesses developed in that area a discount for transportation funding. I already talked about the credits. The reimbursements is the thing that I did not mention, when we give reimbursements, it cannot be for just any road or any project. It needs to be a qualified project which comes out of the transportation system plan. The last funding that I want to share with you, which comes from property owners is a payment maintenance utility fund. So, the SDCs, when they pay those fees, the pavement maintenance utility fund is for the use of a road and they pay with a utility bill that has sewer and water on it, they also pay maintenance fee for pavement. That was established by ordinance 8-1007. Gas tax was not enough so we created a new fund. The study determined that the time that we needed $11 per customer but we felt that was way too much to start out so we implemented that over a four year period. We started at $4.50 per unit and raised it annually until July 2012 we made it to $11.22. And of course, we thought that was going to be enough and soon found out it was not enough. But how did we use that? We used it on the annual resurfacing program and that is like the annual rehabilitation program where we start doing more repair or a pseudo-replacement of the road as well as annual crack repair and annual maintenance programs. What does that funding look like today? The single-family rate is now $13.39. A multifamily residential per unit pays $9.40. Nonresidential is kind of a complicated calculation. We take the trips from the ITE manual and we multiply that by the square footage of the building and that comes up with the total number of the trips and that is a multiplied rate of $.23 and then schools are based on the number of students. Here is where we are at today. You can see back in 2011 we had a pavement condition index and that is what we call the quality of our pavement. It is a scale of 0-100. We were down in the 60s. Our goal was to be in the 70s and we reach that goal in 2016. We have been there since that time. We created a program in 2008, we updated it in 2012 and 2015 and most recently in 2019. The annual budget has ranged between $1.4 million up to $2.8 million. This also influences other work in the city. We want to make sure that the water main is taken care of before we take care of the road. We don't want to repave something and then have it torn up a year later. Currently our annual budget is ranging between $1.9 million and $2.95 million. That excludes paving work. We increased the PMUF by 3% over year. It is also based on the consumer use index. We consider new technologies and we have thought about, should some of these roads become private and maintained by a homeowners association. Our city Council has currently said they do not support that so we are always looking for new ways to reduce our cost. You can see in 2024, with the chart on the right, they expect our PCI to go down and the deferred maintenance to go up. We expect our percentage of the network in good condition to go down and our percentage of poor conditions to go up. So it is better than just having the gas tax. At some point though we are going to have to keep watching this and see if that continues to happen. So those are what I have to tell you today. Icy questions on the left and I will let the moderators tell me how to answer those.
Thank you, Josh. I just want to remind people again that they can do *1 to call in. There are a number of questions here. I will read them first. I think some of these, Josh could answer. First of all, how does Oregon City treat electric vehicles? Or is there a special fee. And what about projects that shift load share to transit or active transportation but might reduce auto capacity in certain segments. And how do you rate your roads by staff or automated systems? And lastly, -- Josh, do you want to try those?
Sure. So for the electric vehicles, there is a different program in Oregon. It is called OREGO. Electric vehicle users can sign up and pay a fee. I don't know if it's monthly or how often. I believe it is a monthly fee and they pay in to do their fair share. And people that have gasoline vehicles can join that and say they will pay a monthly fee instead of the gas taxi because they will use less than the gas tax. If you look up OREGO you will see a different pilot program to fund things in a different way. Electric vehicles are a question that has been talked about a lot of the state level because we are getting more and more in the Oregon area. With respect to capacity in transit, the SEC could go to the city level but we fall under what is called Metro and that is a regional transportation system that's services the city. We do not have a separate system so our projects really only go towards our walking and biking. So it does not affect us in that way but it could if we had those systems. The payment is a monthly fee and then, how do we grade our roads? We use an automated system. It is not as great as having a consultant to do that. We like to use a consultant and keep them on for a long period of time. When you do it by staff you tend to have more staff turnover. But when you do it by company, it seems to be the same people that do it.
I want to offer for Josh to give some thoughts on these issues. Like how do you rate your roads?
As far as other roads, at the beginning I had mentioned a discount that we offer and so, that is a project that we will take over eventually. And through our development line code --. And also the fees themselves, they don't just look at the car capacity. The do start off with -- as a part of the pipe. It also correlates to other travel by foot and micro mobility. And that is -- [ Indiscernible - muffled ] -- code of ordinances. And then, the question about quality of roads or the capacity of roads?
I think it was the quality of the roads.
Yes. We use the PCI rating system. And we have done more by the bridge and that's how we look at it as far as Department maintenance.
I am going to ask a couple questions for each member of the panel and please respond if you can. One question is, what is the biggest challenge in getting your developer fee or private sector contribution established and what is the biggest challenge in managing it? Let's start with Michael. Maybe you can talk about the issues of managing it.
In terms of managing it, the question was asked, how does the governance structure work. The joint understanding really works out how the money comes into the program. It basically locks you in. So managing is pretty well set up in the joint memo of understanding in the CREATE government structure. Getting it into the program, that was kind of that catalyst of the blizzard and Mayor Daley sitting everybody down and saying these projects are going to cost this much money and this is what has to happen. On the side I was able to hear, not being a stakeholder or seeing how things were made, but when we did not get the full $160 million to CREATE partners, they took it upon themselves to fund the remaining $28 million that we did not get back in 2017 and 2018 with the understanding that will set them up moving forward into the programming. From what I heard from the conversation with the state of Illinois, the secretary was very adamant that we need to find this $28 million to get this final design done so that we are ready when the next round of large infrastructure funding comes so again, that partnership really sets the tone for the CREATE program.
Thank you. Josh, what is your biggest challenge?
I would say the biggest challenge is really getting your smaller developers or individuals who say just want to build a house on an individual lot, that is a large chunk of money for people to deal with. So we actually have a response to that that we have a program that if you can't pay the funding up front, that we offer a 10 year 9% interest program and they can pay it off that way. We do have some people that are behind on those payments. We have around 50 or so of those payment agreements right now but only a handful are behind so it does tend to work. Besides that, they pay development charges and they are not surprised by that. They know that they have to do it so we don't get too much blowback.
Thank you. And for time purposes I want to point out a question that I think you could answer. What is the best way to transition from impact fees to mobility fees?
So the biggest challenge was when -- was still going on. The biggest challenge is when we had put, we previously had impact fees and we put a moratorium on those for several years and then the commission at the time ended up eliminating them altogether. But then, the commission, at the time, when we started doing the studies that I outlined, they recognized there was a major issue in transportation because we were not giving the developers, they were not paying their fair share so we were getting a backlog and we just did not have the funding to fund our wish list and our capital improvement programs. So that, that kind of answers how we transitioned. We saw that in the past and we also wanted to not repeat those. We also wanted to come up with a way of being fair with the developers and not charging an exorbitant amount based just solely on automobile trips. For example, I know that when we had impact fees, because of the number of trips that day cares were producing they were being charged in the exorbitant amount compared to a small retail store. But, that is someplace you go to on the way to work and on the way home from work so we wanted to look at that. So, the biggest challenge was getting the developers to then, they get used to not paying those impact fees and getting them to understand that they are going to have to pay now for the impact fee. There were a lot of stakeholder group meetings. We gathered consensus and they began to understand that people needed to be able to get around and that is ultimately how we got to the political aspect of that. Does not answer the question?
Yes, it does. I think we have time for one more question. If you have additional questions please put them in the chat box. Next, how do you address operations and maintenance cost? I know we talked about developer contributions. Josh, you discussed this and but maybe you would like to elaborate on that and I would like to hear what the others have to say as well.
So operation maintenance in Oregon and Oregon City is funded by gas tax. And if it is not enough, like it was in our case, we were able to implement the payment maintenance utility fund. So for us, the gas tax does the basic work. So filling potholes and vegetation but then crack sealing comes from the payment maintenance utility fund. The impact fees cannot be used at all for maintenance.
Thank you. Michael. Within the CREATE program these are all capital cause.
The $6.4 million is the entire capital program. The railroads are responsible for all of their future operation maintenance as well as the city, state and county pieces of infrastructure. That falls under their operations and maintenance purview. The railroads within Chicago spend aliens of dollars in oh and M fees. Just due to the age of the Chicago infrastructure. So over the past 10 years I think they have injected something like $5 billion in fees but again, separate off to the side and not part of their contribution to the capital program of $4.6 billion. There is no commitment there then to say they are at the same level?
There is no commitment but if you utilize federal dollars on a federal project it is within the U.S. code as well as the CFR that you now own, operate and maintain that infrastructure otherwise, in essence, if you do not, the D.O.T. can come back and take that money back from you but that is all covered under the code as well as the regulations that once you turn over a piece of infrastructure it is operated and maintained accordingly.
Okay. Great. Joshua.
[ Indiscernible - muffled ]
Operation and maintenance cost. So, we have a number of funding mechanisms. We are not able to utilize mobility fees for operation and maintenance. Those are for capital costs only but we do have gas taxes and we have a sales tax, an infrastructure sales tax that expires in a few years but right now we utilize that and then we have the general fund as well. But that is how we address that. We do that through the road and bridge Department and that fun.
You go, very much, panelists. I appreciate your contributions I am going to turn it back over to Pepper now to close things back up.
Thank you, Sasha. Hopefully everybody can hear me right now. I want to let people know about our upcoming webinars. And virtual exchanges. We are pulling up a table that shows our events coming up in July, August, September and October. The next is July 23 and that covers special assessments and transportation improvement districts. The link at the top will take you to a page where you can register for each of these. If you will take a look to the left of the slide you will see a file share pod and that has all of the presentations from today. And if you highlight one of those files and then click the button in the upper right corner of that window you will have a chance to download all of the files or individual files. There is also a button at the bottom that says download files so you can grab all of them at once or just the ones that you want. In addition, as I promised, I will let you know how to obtain confirmation of your participation in the event today. If you look at the notes up in the corner you can see an email address. That is ValueCapture@dot.gov. Send an email to that regarding your participation and you will get confirmation back on your participation in today's Value Capture Virtual Peer Exchanges. I also want to bring up a short evaluation for the event today. It is a few short questions. If you could please provide us please provide us with some feedback and how we can improve future events. We would greatly appreciate that if you would just take a few seconds to complete that evaluation for us. I want to give a thank you to all of the presenters today. For their time in being a part of today's event. Also the support of the web conferencing folks at the Federal Highway Administration. We really appreciate their ongoing support also to the Value Capture team. And also thank you to our moderator, Sasha from IMG Rebel. With that we will wrap up today’s event. Again, please look at the file share pod for a recording of the webinar and the slides will also be posted on the Federal Highway Administration website. With that, we will conclude today's event and thank you, for your participation.
This concludes today's call. Thank you, for your participation. You may now disconnect.
[ Event Concluded ]