Reston Transportation Funding Plan: July 15, 2016

County of Fairfax, Virginia

Reston Transportation Funding Plan

Stakeholder MeetingJuly 15, 2016

Tom Biesiadny, Janet Nguyen, Ken KanownikFairfax County Department of Transportation

Department of Transportation 1


Agenda

• Background Information– Purpose– Improvements to be funded– Preliminary cost estimates– Reston funding plan overview

• Coordination with the Reston Network Advisory Group

• Status



TermsAs defined specifically for use in the Reston Transportation Funding Plan:

• Private Funding: Revenues generated from sources specifically from Reston, to fund projects in Reston.

• Proffer: Voluntary commitment by landowners/developers to perform an act or to donate money, land, services or products to address/offset impact(s) arising from their proposed rezoning:

– Cash Proffer: Money voluntarily agreed to in writing signed by the owner of property subject to rezoning, submitted as part of a rezoning application.

– In-Kind Contribution: Contribution of goods, services, or construction. For example, a developer seeking rezoning agrees to implement a part of the project for which the rezoning is being sought.

• Road Fund: Dedicated account for cash proffers towards road improvements, in a specific area that are not otherwise being constructed by a developer.

• Service District: A service district is a mechanism established by the Board of Supervisors to fund improvements located within a defined geographic area. (i.e. sanitary, transportation, gypsy moths).

• Transportation Tax District: A tax district is a mechanism established by voluntary petition of landowners in a defined area and is approved by the Board of Supervisors to fund transportation improvements within the defined area. (i.e. Dulles Rail Phases I & II, Route 28).

• Public Funding: Revenues generated from County-wide tax sources that are being applied to the Reston Transportation Funding Plan.

• Transit Station Area: The area within the influence area of a Metrorail station.



PurposeThe Reston Phase I Comprehensive Plan Amendment was adopted by the Fairfax County Board of Supervisors on February 11, 2014. The plan amendment increases densities in the Reston area and recommends new transportation projects to support new commercial and residential development.

The Board follow on motion from the adoption included the Planning Commission recommendation to conduct:


“…an inclusive process to prepare a funding plan for the transportation improvements recommended in the Reston Master Plan and report with its recommendations. The funding plan should include arrangements for financing the public share of Reston infrastructure improvements and facilitate co-operative funding agreements with the private sector. The PC strongly believes that public and private investment in Reston is both critical and responsible for ensuring Reston’s future success.”


Improvements to be Funded• Road transportation improvements1

(Bridges/Overpasses, Widenings, Extensions, Interchanges) to enhance connectivity

• Intersection improvements required for adequate traffic operations

• Grid improvements (a network of new multimodal streets around the Metrorail stations) to enhance pedestrian and vehicular circulation in, around, and through, station areas


1 All roadways will be designed with pedestrian facilities. Many will also have bike facilities.


Improvements to be Funded


$1.210B• Roadway Improvements

$0.045B• Intersection Improvements

$1.021B• Grid Improvements

$2.276B• Total Improvements

Reston Improvements Estimate

All estimates are planning level estimates and are subject to adjustments.


List of Improvements to be Funded


Reston Funding Plan Projects Estimate

Roadway Projects DTR Crossing at Soapstone Overpass – Sunrise Valley Dr to Sunset Hills Rd $170,000,000 DTR Town Center Parkway Underpass – Sunrise Valley Dr to Sunset Hills Rd $170,000,000 Fox Mill Road Widening – Reston Parkway to Monroe Street $60,000,000 McNair Farms Drive Extension/Widening $10,000,000 Monroe Street Widening – West Ox Road to Town of Herndon $80,000,000 Pinecrest Road Extension – South Lakes Dr to Sunrise Valley Dr $25,000,000 Reston Parkway Widening – South Lakes Drive to DTR $25,000,000 Route 286 - DTR to West Ox Widening $80,000,000 Route 286 at Sunrise Valley Drive (Interchange) $400,000,000 South Lakes Drive Overpass – Sunrise Valley Drive to Sunset Hills Rd $90,000,000 West Ox Road Widening – Lawyers Road to Centreville Road $100,000,000

Total Roadway Projects $1,210,000,000 Intersection Projects Centreville Road/Sunrise Valley Drive $10,000,000 Centreville Road/DTR EB on/off Ramps $1,500,000 Hunter Mill Road/Sunset Hills Road $3,500,000 Reston Parkway/Bluemont Way $4,000,000 Reston Parkway/DTR WB on/off Ramps $5,000,000 Reston Parkway/New Dominion Parkway $5,000,000 Reston Parkway/Sunrise Valley Drive $15,000,000 Wiehle Avenue/DTR EB on/off Ramps $600,000

Total Intersection Projects $44,600,000 Grid Network $1,021,000,000 Total $2,276,000,000

All estimates are planning level estimates and are subject to adjustments.


Reston Transportation Funding Plan Overview

Strategy for providing financial resources to pay for transportation improvements in the Reston Comprehensive Plan Amendment, approved February 11, 2014.

• 40 Year Plan• Identification of funding sources and cost allocation• Project priorities• Cash flow



Coordination with the Reston Network Advisory Group

Mission Statement: Following the adoption of the Reston Master Plan Phase 1 update, the Reston Network Advisory Group was created by the Hunter Mill District Supervisor to establish a forum for the Fairfax County Transportation staff to receive input and feedback from residents and property owners/developers on the Reston Network Analysis and associated plans…..1

• Advisory group members include landowners, residents, community representatives, and members of the business community.

• Advisory Group meetings are open to the public.• Charge - Review potential strategies for funding Reston transportation

improvements.• Charge - Provide feedback to staff on potential funding plan scenarios.


1. Full mission statement can be found at: http://www.fairfaxcounty.gov/fcdot/restonnetworkanalysis/advisorygroup.htm


Shared Funding Solution• Public and private investment in Reston is necessary to ensure Reston’s

future success.


Reston

Public Investment

Private Investment


Shared Funding Solution

• Public funding means revenues generated from County-wide tax sources that are being applied to the Reston Transportation Funding Plan; includes money from the following sources:– Federal grants and programs– State grants and programs– Regional revenues– Local revenues



Shared Funding Solution

• Private funding means revenues generated from sources specifically from Reston to fund projects in Reston; includes money or contributions from the following sources:– Proffers from developers

– Contributions to a Road Fund (per square foot/per dwelling unit)– In-kind Contributions, such as actual construction of improvements

– Tax Districts/Service Districts (local revenues that will be counted toward “private” contributions)

– Recommendations from the Advisory Group



Public Revenue Sources

Federal • Formula Funding• Discretionary Grants

State • HB2 - Statewide High Priority

Projects, Construction District Grant Programs

• Revenue Sharing

Local/Regional• Commercial and Industrial

(C&I) Taxes• General Obligation Bonds HB2313• NVTA 30% Local Funds• NVTA 70% Regional Funds



Public Revenue Sources• Federal, State and Regional funds can be difficult to predict• Competitive process: federal discretionary grants, state HB2 funds,

and NVTA 70% Regional Funds• Each source has specific requirements and restrictions• Cash match may be required for certain funds• Public revenues are distributed to projects County-wide• Most of the public sources have already been committed to projects

in the Board’s Six Year Transportation Project Priorities (TPP) for FY2015-FY2020

• Beyond FY2020, there’s flexibility in how public sources of transportation revenues are applied.



Potential Private Revenue SourcesProffersVoluntary commitment by landowners/developers to perform an act or to donate money, land, services or products to address/offset impact(s) arising from their proposed rezoning

• Cash Proffer: Money voluntarily agreed to in writing signed by the owner of property subject to rezoning, submitted as part of a rezoning application.

• In-kind Contributions: Actual construction of improvements.



Potential Private Revenue SourcesService DistrictAd valorem tax on all properties within a defined geographic area to fund specific service improvement needs for that area; established by Board of Supervisors.

Transportation Tax DistrictAd valorem tax on commercial and industrial properties within a defined geographic area established by voluntary petition of landowners and approved by the Board of Supervisors to fund transportation projects for/related to that area.



Potential Private Revenue SourcesTax Increment Financing (TIF) – A funding mechanism that captures net new tax revenues within a defined geographic area (TIF district) to fund public projects in the TIF district to promote economic development or redevelopment.

• Define district, usually commercial, to declare a tax increment district, which will be developed for higher and better use.

• Define a base year assessment. Tax revenue at the base year is “frozen” continuing to accrue to the normal tax funds at those assessment levels.

• Additional tax revenue (tax increment) based upon increases in assessed values over and above the base year assessment rate are allocated to a tax increment fund, and would be used to fund identified improvements.

• Financing option – Property taxes are most commonly used to fund TIFs. TIF revenues are usually pledged to support bond debt service (requires Community Development Authority (CDA)). May be used as pay as you go, rather than to support debt.

• TIF does not directly change the Real Estate Tax rate.



Potential Private Revenue Sources


Base Year Assessment (Existing Tax Base)Revenues continue to accrue to normal tax funds.

Total New Tax

BaseTax IncrementTo support public infrastructure or bond debt service

Life of Tax Increment Financing District

Ann

ual T

axes

Gen

erat

ed

Frozen revenue for basic services

Basic TIF Model: Future Tax Revenue – Baseline Tax Revenue = TIF Revenue

Using the basic TIF model, a TIF district over the Reston TSAs may generate up to $900k per 1% of real-estate assessed value growth on its first year.

Assessed Value Growth Revenue

1% $ 900,000 2% $ 1,800,000 5% $ 4,500,000


Building the Funding Plan


Activity Completed Underway Future

Discussion with Reston Network and Funding Advisory Group

Projects and preliminary cost estimates for roadway, intersection, and grid improvements

X

Potential revenue sources and funding mechanisms for the plan

X

Division of public and private responsibility for plan costs X

Analysis of several funding scenarios X

Individual project prioritization (Network Analysis Study) X

Timing of funding needs X

Public comment X X X


Funding Allocation Plan – Funding Responsibility

Discussed with the Advisory Group various methods of allocating costs to public/private revenues in the plan.

1. Tysons Cost Allocation Model Applied to Reston2. Project Location – Outside or Inside Reston TSAs3. Use - Through/Local Ratios 4. Location and Through/Local Ratios 5. Project Category6. Regional vs. Local Significance



Reston Funding Plan Allocation FrameworkThis cost split was chosen by staff as basis for discussion of funding scenarios. Staff is still seeking comments on this proposal.

In this example, public and private revenues will share costs, approximately equally.

Reston Roadway projects would be paid for with public revenues.

Most Intersections and the Grid would be paid for with private revenues.


Please note that the information provided in this presentation is not final and is for discussion purposes only.

Option 5: Project Category

Project Estimate Allocation ($) Reston Roadways $1,210,000,000 Public Share 100% $1,210,000,000Private Share 0% $0 Reston Intersections $45,000,000 Public Share 0% $0Private Share 100% $45,000,000 Grid $1,021,000,000 Public Share 0% $0Private Share 100% $1,021,000,000 Total $2,276,000,000 Public Share 53% $1,210,000,000Private Share 47% $1,066,000,000


Tentative Allocation of Grid of StreetsIn-Kind vs. Road Fund (Cash Proffers)



Funding Scenario – Private Share


Private Share Estimate$1.021B• Grid Improvements

$0.045B• Intersection Improvements

$1.066B• Total private share

$0.711B• Less: in-kind contributions to grid

$0.355B• Net funding need from private share

Please note that the information provided in this presentation is not final and is for discussion purposes only.


Funding Scenario – Road Fund• Dedicated account for cash proffers towards road

improvements, in a specific area that are not otherwise being constructed by a developer.

• Contributions are based on rates for:– residential dwelling units– commercial square footage



Current Fund Area Rates - 2016


Development/Fund Area

Residential Rate per Dwelling Unit

Non-Residential Rate per Sq. Ft.

Fairfax Center $1,316 $5.94

Centreville $2,522 $6.38

Tysons (Rezonings Prior to 2/1/2013) $970 $4.37

Tysons-Wide $1,045 $5.90

Tysons Grid of Streets $1,045 $6.73

Combined Tysons Rates:

$12.63/sq.ft.;$2,090/unit


Road Fund Scenarios• Through the working process with the Advisory Group, staff

originally proposed seven road fund scenarios.• Five additional scenarios have been added based on feedback from

members of the Advisory Group.• Certain road fund rate scenarios may have a related funding

shortfall that needs to be addressed through other revenue sources.• Potential revenue sources for addressing a shortfall include but are

not limited to– Service District– Tax District– Tax Increment Financing– Recommendations from the Advisory Group



Original Scenarios 1-7• Scenario 1: Tysons residential rates• Scenario 2: Tysons commercial rates • Scenario 3: Rates proportional to Reston development• Scenario 4: Tysons rates and service district over Reston TSA• Scenario 5: Tysons rates and tax district over Reston TSAs• Scenario 6: Tysons Rates and Service District over Reston &TSAs• Scenario 7: Tysons Rates and Service District over Sp. TD5



Scenario 8-9• Scenario 8-9 were developed from the Advisory Group’s request to

evaluate land values between Reston and Tysons

– Scenario 8: General adjustment from Tysons rates, -11%– Scenario 9: Specific adjustments from Tysons rates, +15%, -19%


Comparison – Reston TSAs to Tysons Assessed Values Reston 2015 Tysons 2015 Dollar PercentResidential Value/DU $ 260,129 $ 220,362 $ 39,766 15%Commercial Value/Sqft $ 239 $ 284 $ -45 -19%Residential Value/Sqft $ 221 $ 188 $ 32 15%Average Sqft* $ 235 $ 261 $ -26 -11%*Assessed value for a given sq. ft. regardless of zoning



*These are average annual rates that do not reflect actual cash flow needs.These scenarios have been proposed by staff or by recommendations by the advisory group and are all based in some type of applicable logic. Different rate scenarios could apply in the future. Please note that the information provided in this presentation is not final and is for discussion purposes only.

Road Fund Rate Scenarios

Contribution Rates and Other Funding Needed

Residential/DU

Commercial/SF

Other Funding

($M)Tax District

Rate*Service District Rate*

Growth required for

TIF*Scenario 1: Tysons residential rates $2,571 $18.70 N/A N/A N/A N/AScenario 2: Tysons commercial rates $4,759 $12.63 N/A N/A N/A N/AScenario 3: Rates proportional to Reston development $7,159 $5.97 N/A N/A N/A N/A

Scenario 4: Tysons rates and service district over Reston TSA $2,571 $12.63 $83.43 $0.03 $0.015 ~2.0%

Scenario 5: Tysons rates and tax district over Reston TSAs $2,571 $12.63 $83.43 $0.03 $0.015 ~2.0%

Scenario 6: Tysons Rates and Service District over Reston &TSAs $2,571 $12.63 $82.60 $0.03 $0.015 ~2.0%

Scenario 7: Tysons Rates and Service District over Sp. TD5 $2,571 $12.63 $75.92 $0.03 $0.015 ~2.0%

Scenario 8: General adjustment from Tysons rates, -11% $2,288 $11.24 $111.20 $0.035 $0.02 ~3.0%

Scenario 9: Specific adjustments from Tysons rates, +15%, -19% $2,957 $10.23 $85.22 $0.03 $0.015 ~2.5%


Feedback on…• Do any of these scenarios work?• What features do you like? What features don’t you like?• Are you comfortable with a road fund at an appropriate rate?• What other options should staff be considering?



Next Steps

• Seeking public/stakeholder feedback and analyze comments

• Advisory group feedback and regular advisory group meetings throughout the process.

• Development of a draft staff recommendation for the Reston Transportation Funding Plan

• Board Transportation Committee (BTC) meeting, Fall.• Preparation of final recommendations.• Board of Supervisors approval by end of 2016.



Comments/Questions/Discussion


Government & Nonprofit

Reston Transportation Funding Plan: July 15, 2016