Transit Oriented Developments

What if a family could cut $3,000 in annual transportation costs while living closer to work and recreation?

Transit-oriented infrastructure is a new vision of urban development where residential, commercial, and recreational spaces are integrated into a development within a 10-minute walk of reliable public transit. Transit-oriented developments (TODs) have many defining features – proximity to transit hubs, mixed-use developments that maximize land efficiency, pedestrian-friendly design concepts, and a balance of urbanism and green spaces.

In recent years, TODs have grown in popularity with developers and governmental programs, as funding for TOD projects has increased by 38 percent in the past five years. Since 2015, the Federal Transit Administration (FTA) has played an important role by providing technical assistance and resources, including $133 million to support TOD projects.

To fill funding gaps, the FTA engages private sector actors through participation in the FTA’s Planning and Transportation Improvement Program or through entering a private-public partnership, allowing private entities to have the primary role in designing, operating, and maintaining TOD projects.

Further efforts by FTA include establishing the Private Investment Project Procedure (PIPP), which allows limited grantees to request waivers or modifications to existing regulations that may have discouraged private sector involvement in TODs.

In 2022, Federal support for these projects grew with the passing of the bipartisan Infrastructure Investment and Jobs Act, which set priorities that aligned with TOD’s goals to develop and retain more housing and retail space and encourage ridership. The University of Maryland was awarded a $1.6 million grant to retain homes and businesses along the upcoming Purple Metro Line. In addition, plans for a TOD development along a central bus corridor were conceived in Oklahoma. As part of this, Oklahoma City and the Central Oklahoma Transit and Parking Authority were granted $975,000 to plan the TOD along this corridor.

Congress also passed the Moving Ahead for Progress in the 21st Century Act, supporting coordination between public and private transit providers and promoting the efficient use of private sector expertise to draw in additional funding for TODs and provide for technical or educational assistance.

Studies have identified potential benefits of TOD projects:

• TODs boost ridership by 20 to 40 percent, reducing traffic congestion.
• They have been associated with decreased household driving costs, saving families between $3,000 and $4,000 per year.
• TODs have proven effective in lowering carbon emissions per household by 2.5 to 3.7 tons annually.
• TODs affect infrastructure costs; with higher density, local governments can reduce these costs by 25 percent per year.
• They may improve public safety by adding additional street lighting, creating safer pedestrian spaces, and installing safe crosswalks.
• Encourage healthier lifestyles. A paper published in the Journal of Transport & Health found that 20 percent of respondents achieved their recommended physical activity levels through trips in TOD areas.

TOD projects have had many successes. In Portland, Oregon, an industrial space was transformed into the Pearl District, which built a new TOD district full of residences, retail, and recreation. Similarly, the Ballston-Rosslyn corridor was completed in Arlington, Virginia, which brought mixed-use space and transit within typical suburban settings.

Despite these successes, many barriers to TODs exist:

• They incur high initial investment costs because developing public transit and its infrastructure requires significant funding.
• Current restrictive zoning regulations (e.g., single-family-only zoning laws) are outdated and resist increasing density in areas around transit centers.
• City planners must balance accessibility and affordability with gentrification, often pushing people out of these developments.
• Political roadblocks like “NIMBY” (not in my backyard) often push officials to restrict these developments.
• Difficulty exists in coordination between various actors and stakeholders with competing interests.
• Maintaining federal funding is complex and uncertain.

These projects are not without failures. For instance, a TOD development in Newtonville, Massachusetts, was intended to increase ridership on underserved public transit. However, the local Planning Department discovered that the projects meant to boost ridership had seen only two residents use the free pass in its first year of operation. There are also cases where NIMBY caused the funding structure of TOD to unravel, such as Moorefield Station in Loudoun County.

These complexities of TOD developments highlight the importance of aligning TOD incentives with commuter needs, rather than assuming that proximity guarantees ridership.

Due to these challenges, several avenues could be considered to support and improve the development of TOD projects. Continued consistent federal funding and more regulatory flexibility can support public-private partnership initiatives. Expanding partnerships may bring more efficiency and capital to the communities in which TODs are implemented.

To facilitate better coordination, TOD policy should only target projects near existing or planned quality transit centers. Transit quality should ensure that transit service is frequent, reliable, and aligned with residents’ needs.

Literature has shown a correlation between restrictive zoning laws and ineffective land use around transit centers. For instance, only 39 percent of transit centers in the New York metropolitan area have zoning that facilitates multifamily development, and the remaining 61 percent of the area’s zoning is restrictive of multifamily buildings around transit centers. Streamlining these regulatory barriers across jurisdictional levels and providing additional educational and technical assistance to developers, cities, and nonprofits may alleviate these challenges.

As TOD projects become more popular with policymakers, planners, and communities, we will need to weigh these opportunities and challenges. Assuring consistent funding, supporting private-public partnerships, and streamlining or easing zoning restrictions will help balance the tradeoffs of TODs for cities and people alike.

Written by Trevor Mathia, Public Policy Intern