Seattle Land Use Code blog has a long and valuable post on the tools and ingredient that would help move TOD forward in Washington State. While you’re reading the post keep SLU and Yesler Terrace in mind. I think both of these project provide an interesting lens to view the post through.
I’ve spent a fair amount of time in the last several months listening to people tell me all the things they think we need to facilitate Transit Oriented Development (TOD) in these parts. It’s part of a longer set of discussions going back into the 90s when people asked, in a similar way, “how do we implement the Growth Management Act?” Here’s my quick answer; we have all the ingredients we need to facilitate leaps and bounds toward TOD. What we’re missing is leadership. Second, we could make TOD happen without as much leadership if we had significant changes to our constitution, city charters, and tax codes.
What I am going to do is cover the things and agency would need to set out on a massive TOD effort. I’ll include the pieces we already have and where they are. Then I’ll explain my leadership comment. And a caveat: these are notes. If I am wrong or missed something, please comment.
The ideal TOD agency would be able to raise significant revenue on its own by levying sales, property, and payroll taxes. You get the first two, right? But payroll taxes? Yes, you read that right. In order for any agency to generate the kinds of revenue needed for significant capital investments, right-of-way acquisitions, land purchases, and operations of connecting transit infrastructure (trollies, jitneys, shuttles etc) it would have to be able to raise taxes on its own. TriMet in Oregon actually raises huge money, most of their $211 million budget, from a payroll tax. Taken together these three sources would get the job done.
Who already has it?
Sound Transit raises most of its money from sales tax and local governments fund transit from sales taxes. Local government can already raise property taxes as can the Port of Seattle and other benefit districts and taxing districts created by the legislature. While uniformity is a problem with property taxes, the constitution allows for the creation of any number of taxing and benefit districts that could raise revenue for TOD.
How do we get it for TOD?
The legislature would have to pass legislation to allow a TOD agency to raise money this way. The payroll tax is doable, today, as long as it’s not an income tax. TriMet’s payroll tax is a percentage, but a TOD agency could just charge a flat fee like the head-tax that was eliminated by the Seattle City Council.
The post goes on to cover condemnation and eminent domain, zoning and land use, tax increment financing and land value tax, public credit, and leadership.