White Flint Sector Plan Infrastructure Financing
Testimony Submitted to Montgomery County Council, October 26, 2010
Presented by Cavan Wilk on Behalf of the Action Committee for Transit
The land around the White Flint Metro station is incredibly valuable. Even in the current economic climate, our region is one of the few in the United States that is still projected to gain jobs in the coming decades. The free fall of housing values in the exurbs implies that the marketplace no longer regards such properties as highly as in previous decades. The fact that housing closer to the Beltway in a transit-proximate location has retained its value while other housing has fallen over the last two years shows that the market currently greatly values the transit-oriented arrangement over the car-dependent subdivision.
The newly adopted White Flint sector plan represents a breakthrough in creating the livable transit-oriented neighborhoods that are now in such high demand. The plan goes beyond merely placing density near the Metro. Additionally, it designs streets and neighborhoods that are truly oriented toward walking, bicycling, and transit. For the people who live and work at White Flint, the financial responsibility of owning a car and buying gasoline will become a positive optional luxury, rather than a financially burdensome necessity. They will be able to affordably live in Montgomery County, rather than commuting from far-flung counties.
The Sector Plan also represents a badly needed shift in thinking about how to plan for BRAC. While hosting the National Institutes of Health and the Navy Medical Center creates planning challenges for the county, they also provide large numbers of jobs. More new residents will move to Montgomery County as those facilities grow. White Flint will provide all those new residents the opportunity to live two Metro stations away from their place of employment.
In previous decades, Montgomery County got in the habit of providing infrastructure by widening existing roads and building more roads at the rural fringes of the county. It then approved more car-dependent subdivisions and strip malls. While some of the funding came from development fees, more of it came from the county’s existing budget. As the county has evolved and our roads have become more crowded, the continued expansion of strip malls and single-use subdivisions has come to harm our quality of life. Yet, tax revenues continue to flow into highway infrastructure that supports this outmoded form of growth.
The implicit premise of the Office of the Executive's proposal is that general tax revenues can and should be used to support sprawl development, but may not be used to support transit-oriented development. If our county's stated smart growth-oriented transportation and land use priorities have any meaning, infrastructure for our transit-oriented places must not merely be an equal priority, but a higher priority than infrastructure for car-dependent sprawl.
ACT believes that investment in White Flint's infrastructure is a much higher priority than the highway widenings currently budgeted over the next six years. However, it is not necessary to choose. Because of White Flint’s high land value, new economic investment in the area is projected to return positive tax revenues to the county in the short term. The increased tax revenues could then be reinvested in Sector Plans that are projected to take longer to generate positive tax revenue like White Oak, Wheaton, and the Great Seneca Science Corridor. However, the perpetual positive tax revenues are currently in jeopardy on account of a $100 million infrastructural funding gap, amortized over 30 years. The gap represents less than 1% of the county’s debt cap.
Neighboring Arlington County, Virginia has recently approved Tax Incremental Financing (TIF) as part of its revitalization plans for its Crystal City neighborhood. Despite the Office of the County Executive’s ambivalence about using a TIF for White Flint, it is hardly an untested funding mechanism. It would allow a small fraction of the increase in tax flow to the county from White Flint to be put towards further increasing its positive economic impact. Such a plan would capture a small amount of the increased tax revenues from White Flint and reinvest it to fully complete all three phases of the Sector Plan. The county will collect even more taxes from a fully built out White Flint than from an incomplete plan, in perpetuity.
If the County Council and Office of the Executive prefer not to use a TIF, they should find another suitable funding mechanism that captures revenues from the White Flint Sector Plan and dedicates it to necessary infrastructure. The overarching question is how to provide the right level of financing for the Sector Plan. General Obligation (GO) bonds from the Capital Improvement Budget represent the cheapest possible alternative to fund the necessary conversion of Rockville pike into a pedestrian-friendly urban boulevard with a dedicated bus/streetcar right-of-way in its median. As mentioned in a previous paragraph, the GO bond of $100 million amortized over 30 years represents less than 1% of the county’s debt cap. The General Obligation bonds would be paid back out of the extra revenues generated by White Flint development, and they would be less expensive than TIF bonds.
White Flint is simply not viable in the long-term without a Rockville Pike that is compatible with a pedestrian-friendly environment. Rockville Pike is currently hostile and dangerous to pedestrians, with too few crosswalks, too-fast automobile traffic, and too many large surface parking lots. The recent deaths of two young men who responsibly enjoyed nightlife in D.C. by taking the Metro rather than drinking and driving and were killed in a crosswalk while crossing Rockville Pike is a terrible tragedy. It is also a painful example of why Rockville Pike in its present form will be a deterrent to new residents and offices moving into White Flint.
In order to further foster a safe, attractive, and compelling environment for pedestrians, lanes should be 10 or 11 feet wide. Lanes that are 12 feet encourage excessive speeding because motorists perceive that they are driving on a highway rather than in a town environment. A streetcar/busway in the median of the Pike will further encourage transit, biking, and walking in the future White Flint town. Any funding plan that omits rebuilding Rockville Pike into a pedestrian-friendly urban boulevard is a plan that would doom the White Flint Sector Plan.
The famous 20th century philosopher George Santayana once said, “Those who do not learn from the past are condemned to repeat it.” Montgomery County’s recent past includes the failures of Clarksburg Town Center. Good plans were never fully implemented in the upcounty development. The White Flint Sector Plan has many advantages that Clarksburg never had: higher land values, proximate Metro access, thousands of jobs, amenities, and fixed rail transit access to neighboring Bethesda, Silver Spring (via the future Purple Line), and D.C. Additionally, it is much more environmentally friendly because precious undeveloped woods and farmland will not be paved over during its construction. The short-term and long-term gains in tax revenue are both positive and large. The opportunity costs of turning White Flint into another Clarksburg are just too high to let a manageable $100 million over 30 years destroy the Sector Plan. Especially when the money for infrastructure improvements in White Flint can be paid for with new tax revenue from within White Flint.