Transportation Utility Fees: Maintaining Local Roads, Trails, and Other Transportation

November 2020
Table of Contents

LIST OF FIGURES

LIST OF TABLES

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report cover

FOREWORD

State and local governments often struggle to mobilize the necessary funds to maintain, rebuild, and expand their local transportation networks. Planned projects often face funding or financing hurdles that may result in projects being delayed for years, if not indefinitely, leaving important safety and mobility objectives unmet.

Value capture refers to a set of techniques that generally takes a share of increases in property tax revenues, economic activity, and growth linked to infrastructure investments to help fund current or future improvements. Under the right circumstances, this may allow practitioners to help close funding gaps and accelerate project delivery, as well as provide key to economic development/redevelopment to provide livable communities, create jobs, and environmental stewardship benefits. It is possible to share a portion of this increased value and benefits to fund the improvements to the infrastructure through what are known as "value capture techniques," which include transportation utility fees (TUFs) (the subject of this primer).

This primer was developed by the FHWA EDC-5 Value Capture Implementation Team and is based on interviews, case studies, and lessons learned from practicing agencies. It introduces the concept of TUFs and how they can provide a gap funding source to help maintain and improve road networks. It also provides several cases to illustrate how cities have approached instituting and managing TUFs.

TECHNICAL REPORT DOCUMENTATION PAGE

1. Report No.
FHWA-HIN-19-005
2. Government Accession No. 3. Recipient's Catalog No.
4. Title and Subtitle

Transportation Utility Fees: Maintaining Local Roads, Trails, and Other Transportation

5. Report Date November 6th, 2020
6. Performing Organization Code:
HIN-1
7. Author(s)

Sasha Page, Christine Shepherd, IMG Rebel; Thay Bishop, Stefan Natzke, Federal Highway Administration

8. Performing Organization Report No.
9. Performing Organization Name and Address

Office of Innovative Program Delivery
Federal Highway Administration
1200 New Jersey Avenue, SE Washington, DC 20590

10. Work Unit No.
11. Contract or Grant No.

IAA HW5NA2, Modification #5

12. Sponsoring Agency Name and Address

Office of Policy and Governmental Affairs Federal Highway Administration

1200 New Jersey Avenue, SE Washington, DC 20590

13. Type of Report and Period
Final Report, December 2020
14. Sponsoring Agency Code
HIN-1
15. Supplementary Notes
The cities in states of Oregon and Colorado assisted in the development of this primer.
16. Abstract

This document provides information for State departments of transportation and local public agencies to consider implementing Value Capture strategy, TUFs.

TUFs can also provide a source of funding to upgrade sidewalks and add or improve pedestrian safety features and curbs, as well as comply with the Americans with Disabilities Act of 1990. The primer provides practical information on what TUFs are and examples of how municipalities use them. It also provides points for consideration when thinking about instituting a TUFs program, such as the favorability of the legal and regulatory environment for TUFs, as well as whether and how TUFs can be used for financing. The final chapter offers examples detailing several ongoing TUFs programs in Texas, Utah, and Oregon.

17. Key Words

Value capture, road and highway funding, innovative finance, real estate-based fees

18. Distribution Statement
No restrictions.
19. Security Classif. (of this report)
Unclassified
20. Security Classif. (of this page)
Unclassified
21. No. of Pages 50 22. Price N/A

Acknowledgements

The Federal Highway Administration (FHWA) would like to express appreciation to the following people who have supported this effort:

Tina Bailey, City of Hillsboro, Oregon

Erica Rooney, City of Lake Oswego, Oregon Josh Wheeler, City of Oregon City, Oregon Dave Klockeman, City of Loveland, Colorado

Cover photos source: USDOT/Getty. All images in the document are sourced from FHWA, unless otherwise noted. Cover design by ICF.

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