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White Flint Sector Plan Implementation Introduction

Introduction

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Issues and goals

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Costs and revenues

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District financing mechanism

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District administrative mechanism

v Costs and revenues v District financing mechanism v District administrative mechanism Implementation

Implementation

White Flint Sector Plan Implementation Issues and Goals

Issues

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Infrastructure delivery

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Infrastructure cost

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Rockville Pike

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Non-transportation infrastructure issues

Implementation

v Infrastructure cost v Rockville Pike v Non-transportation infrastructure issues Implementation
v Infrastructure cost v Rockville Pike v Non-transportation infrastructure issues Implementation

White Flint Sector Plan Implementation Issues and Goals

Issues: Infrastructure Delivery

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Must be timely (public sector shortcoming)

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Must be in meaningful chunks (private sector shortcoming)

Implementation

be timely (public sector shortcoming) v Must be in meaningful chunks (private sector shortcoming) Implementation

White Flint Sector Plan Implementation Issues and Goals

Issues: Road Infrastructure Cost

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Magnitude of cost

 

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Finer grain grid

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Mobility projects

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Streetscaping and place-making

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Incidence of cost

v Matching benefit to payment

Implementation

projects v Streetscaping and place-making v Incidence of cost v Matching benefit to payment Implementation

White Flint Sector Plan Implementation Issues and Goals

Issues: Rockville Pike Issues

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$70M to $90M…and up…

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Timing and ROW acquisition costs

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Not a mobility project

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Mobility during Pike improvements requires an enhanced network

v Not a mobility project v Mobility during Pike improvements requires an enhanced network Implementation

Implementation

White Flint Sector Plan Implementation Issues and Goals

Issues: Non-Transportation Infrastructure Issues

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Limit District’s non-transportation costs

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Non-transportation infrastructure financed in conventional manner

non-transportation costs v Non-transportation infrastructure financed in conventional manner Implementation
non-transportation costs v Non-transportation infrastructure financed in conventional manner Implementation

Implementation

White Flint Sector Plan Implementation Issues and Goals

Implementation Goals

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Predictable infrastructure delivery

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Broad accountability

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Capital and operational support

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Spread costs across beneficiaries

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Minimize public sector risk

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Target public dollars for up-front mobility

…leads us to a “District” approach

sector risk v Target public dollars for up-front mobility …leads us to a “District” approach Implementation

Implementation

White Flint Sector Plan Implementation Costs and Revenues

Implementation Costs

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Estimated master plan transportation costs: $320M

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$70M for Pike

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$42M for transit

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Compare: Twinbrook total was $20M to $25M

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State $70M

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Estimated County costs: $20M+

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Estimated District costs: $150M to $180M

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Estimated County contribution to District: The Gap

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Estimated non-District private costs of master plan facilities: $50M to $80M

Financing

to District: The Gap v Estimated non-District private costs of master plan facilities: $50M to $80M

White Flint Sector Plan Implementation Costs and Revenues

Implementation Revenues

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Residential impact taxes: $23.7 M

Commercial impact taxes: $0 to $22.3 M

impact taxes: $23.7 M Commercial impact taxes: $0 to $22.3 M v Stabilized annual GF prop

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Stabilized annual GF prop tax at build-out (net new development only): $59M

v $43.5M from residential, $15.5M from commercial

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Even pace over 30 Yrs: $916M GF prop tax revenues at build-out (net new development)

v Average $30.5M GF (from net new development)

Financing

$916M GF prop tax revenues at build-out (net new development) v Average $30.5M GF (from net
$916M GF prop tax revenues at build-out (net new development) v Average $30.5M GF (from net

White Flint Sector Plan Implementation Financing Mechanism

Proposed Financing Mechanism

Impact taxes (or equivalent) captured

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Residential

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Commercial impact taxes eliminated, reduced, or phased out

Special tax/assessment

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Levied on new and existing commercial

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Not applied to residential

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Should not exceed 10% on top of total Countywide tax rate (which is 0.978 per $100)

Captured tax revenues

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Only as much as necessary to close financing gap

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Capture up to 10% of incremental new GF revenue

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Issue GO bonds (TIF-like concept)

Financing

gap v Capture up to 10% of incremental new GF revenue v Issue GO bonds (TIF-like
gap v Capture up to 10% of incremental new GF revenue v Issue GO bonds (TIF-like
gap v Capture up to 10% of incremental new GF revenue v Issue GO bonds (TIF-like

White Flint Sector Plan Implementation Financing Mechanism

Issues: Proposed Financing Mechanism

Element 1: Impact Tax

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Key to reducing financing risk

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Effect of crediting

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Commercial impact taxes eliminated, reduced, or phased out

Financing

financing risk v Effect of crediting v Commercial impact taxes eliminated, reduced, or phased out Financing
financing risk v Effect of crediting v Commercial impact taxes eliminated, reduced, or phased out Financing

White Flint Sector Plan Implementation Financing Mechanism

Issues: Proposed Financing Mechanism

Element 2: Special Assessment/Tax

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Applies only to commercial (increased residential assessments have no direct effect on this revenue source)

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Applies to existing and new commercial

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Applying it to existing commercial reduces our financing risk and encourages redevelopment

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Assessment replaces impact tax on commercial development and should exceed constant dollar value of impact taxes (dollar worth less tomorrow than today)

development and should exceed constant dollar value of impact taxes (dollar worth less tomorrow than today)

Financing

White Flint Sector Plan Implementation Financing Mechanism

Issues: Proposed Financing Mechanism

Element 3: Capturing Tax Revenues

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This is not a new tax—just capturing a part of the new revenues generated in White Flint

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Limit to acceptable percentage of net new general fund revenues (e.g. 5% to 10%)

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From taxes paid by both residential and commercial (i.e. not sensitive to shifting mixes)

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Risk is tied to absorption/redevelopment

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Revenue source of last resort…but most necessary up front

Risk is tied to absorption/redevelopment v Revenue source of last resort…but most necessary up front Financing
Risk is tied to absorption/redevelopment v Revenue source of last resort…but most necessary up front Financing

Financing

White Flint Sector Plan Implementation Financing Mechanism

Approaches to District Public-Private Financing

Approach 1: Working backwards from costs

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Establish list of District projects and costs

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Estimate total transportation impact tax contribution

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Estimate total private special assessment contribution

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Remainder=financing gap

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Capture enough tax revenue to cover the financing gap

contribution v Remainder=financing gap v Capture enough tax revenue to cover the financing gap Financing

Financing

White Flint Sector Plan Implementation Financing Mechanism

Approaches to District Public-Private Financing

Approach 2: Working backwards from revenue

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Estimate impact tax contribution

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Estimate private contribution via special assessment

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Establish acceptable ratio of public/private contributions

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Determine total $$$ available for District projects

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Within budget, pick projects with greatest benefit

Financing

Determine total $$$ available for District projects v Within budget, pick projects with greatest benefit Financing

White Flint Sector Plan Implementation Administrative Mechanism

White Flint Redevelopment Implementation Authority

v Powers broad, but the actual list of capital and non- capital costs will be limited and clearly defined

v Powers broad, but the actual list of capital and non- capital costs will be limited
v Powers broad, but the actual list of capital and non- capital costs will be limited

Administration

White Flint Sector Plan Implementation Administration and Financing

Topics for Additional Analysis

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Risk

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Gap

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Defining list of District projects

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Mix of uses and pace of development

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Density and exactions

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Legislative changes, including enabling legislation for the Redevelopment Implementation Authority

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Other issues (e.g. LCOR)

including enabling legislation for the Redevelopment Implementation Authority v Other issues (e.g. LCOR) Next Steps

Next Steps