Often times transit opponents will demand that transit “pay for itself.” This demand is rarely made of other forms of transportation, and therefore hard to take in good faith. Writing on his promising new blog, The Works, Stephen Smith lays out Hong Kong’s model, which solves the funding problem by having the transit agency act as real estate developer. By developing the land around the station, Hong Kong’s MTR is able to finance new station development.
The economics of the Hong Kong model are difficult to export to the US, for the reasons Smith cites in his piece. Our per-mile construction costs are higher and our city governments aren’t sitting on a ton of prime real estate that they can just open to development. I imagine that the same people arguing for self-funding transit would be up in arms if the local government seized a dozen city blocks from private ownership and handed it over to Sound Transit.
To me the most interesting aspect of the Hong Kong model is the way it ties transit-oriented development explicitly to station development. A park-and-ride station next to a freeway would simply never get built because there would be no way to pay for it. Fortunately, Sound Transit adopted an explicit TOD policy a year ago. That’s too late to influence ST2, but in plenty of time to affect ST3.