Dr. Richard Voith discusses recent trends and occurrences in the transportation sector at the Delaware Valley Regional Planning Commission event Changing Lanes.

1. Funding the Future
Richard Voith
President & Principal

2. New Jersey & Pennsylvania – Major Players
$0.23/gal
Tax Increase
$1.23B in
Annual
Revenue
2nd Lowest
Gas Tax in
Nation
8th Highest
Gas Tax in
Nation
New Jersey Public Question 2: 54.5% approved
2

3. Pennsylvania & New Jersey – Major Players
PA Act 89:
• Enacted Nov. 2013
• 5 Year Goal: Add $2.3B to
existing $2.4B in State
Transit Fund
• Sufficient Funding to
Maintain Current System
• In 2017, the Road
Maintenance and
Preservation (Road MaP)
program launched
• A further $2.1 billion to be
invested over next decade
3

4. Threat to Act 89
Trust Fund Raid:
• GOP House budget
proposal proposed major
cuts to transportation
• Some Legislators view the
Transportation Trust Fund
as potential source of
revenue to fill the State’s
revenue shortfall
4

5. 5
Greater Philadelphia Area
Transportation funds ae
crucial to the region, which
is the engine for the State’s
economy:
• > 100% of statewide
population growth
2010-2016
• 40% of Gross State
Product

6. • Moody’s Analytics:
Philadelphia in the
top 3 Metro areas for
Amazon’s HQ2
• Transportation was
viewed as one of the
Region’s strongest
assets
Changing Markets & Demands
6

7. Federal Uncertainty
7
• FAST Act signed in
December 2015
– $305 billion through
2020
• New Administration
considering additional
$1 trillion in
infrastructure funding.
– PPPs likely to play big
role.

8. Transit Infrastructure in the Region
8

9. 40
34
30
46
CIRA SOUTH
ONE UCITY SQUARE
3601 MARKET
APARTMENTS3737
CHESTNUT
APARTMENTS
3737 MARKET
OFFICES
TRANSIT ORIENTED DEVELOPMENT
EXAMPLE: UNIVERSITY CITY
 9M Sq Ft Underway or Completed
 90 ACRE “Innovation District”
SANSOM
STREET FLATS
4415
CHESTNUT ST
PROVIDENT
MUTUAL LIFE
INSURANCE
BUILDING
FUTURE
“INNOVATION
DISTRICT”
∆ IN POPULATION
MFL/BSL Tracts Rest of City Citywide
2000 350,000 1,167,000 1,517,000
2015 379,000 1,189,000 1,567,000
Growth 28,000 22,000 50,000
∆ 8.0% 1.9% 3.3%
3400 MARKET
3800 MARKET
STREET
3711 SCIENCE
CENTER
9

10. Transit Ridership Growth Between 1998-2016
23.0M
25.0M
27.0M
29.0M
31.0M
33.0M
35.0M
37.0M
39.0M
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
FISCAL YEAR
REGIONAL RAIL
+52%
36.0M
38.0M
40.0M
42.0M
44.0M
46.0M
48.0M
50.0M
52.0M
54.0M
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
FISCAL YEAR
MARKET-FRANKFORD
+41%
24.0M
25.0M
26.0M
27.0M
28.0M
29.0M
30.0M
31.0M
32.0M
33.0M
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
FISCAL YEAR
BROAD STREET LINE
+29%
10

11. Transit Infrastructure: New Jersey
11

12. Changing Markets & Demands
• Growth in the City of
Philadelphia
– Growth driven by
millennials & immigrants
• Growing Importance
of City & Suburban
Centers
12

13. Changing Transportation Marketplace
Substitutes
Complements
13

14. Bus Ridership Decline
14
• Recent decline in
bus ridership
(nationally and in
Philadelphia)
• Ridesharing is one
reason for decline
• Ridesharing does
not replace transit

15. 15
15
Ridesharing and Cities
• Ridesharing depends on
same density dynamics
as transit to operate
efficiently
• Ridesharing cannot
support same volume of
trips and density as
transit
• Loss of agglomeration
effects that make cities
attractive
bus

16. & Can Afford to Make Transit Investments
Greater Philadelphia Region is an Economic Powerhouse
16

17. Funding Approaches: Case Studies
17

18. 18

19. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
o Will cost the average adult $14 per
month ($169 per year) in new taxes.
o Passed with 54% of the vote
Funding Approaches: Seattle
19

20. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
• 4 separate ballot measures, each 0.5% of sales
tax
• Generates approximately $3 billion per year
• Measure R passed in 2016 with 69.8%
Funding Approaches: Los Angeles
20

21. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
Funding Approaches: Los Angeles
21
35%
55%
65% 65%
25%
20% 19%
40%
25% 20% 15% 16%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Prop A Prop C Measure R Measure M
Transit Highway Discretionary Local Return

22. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
$1,250.0
$856.0
$366.0
$77.0
$0.0
$500.0
$1,000.0
$1,500.0
$2,000.0
$2,500.0
$3,000.0
$2,643.0
Westside Purple Line Extension
Los Angeles, CA
Other LA
Metro
Funds
LA Metro
Reserve
Funds
City of Los
Angeles
Measure R
(sales Tax)
TIFIA Loan
Federal
47.7%
Local - Loans
32.4%
State
0.1%
Local
19.8%
Local
Total
52.1%
Funding Approaches: Los Angeles
22

23. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
• 122 miles of commuter rail and light rail
• 0.4% local sales tax approved in 2004
• $4.1 billion in sales tax for transit
• Project being completed using PPPs.
Funding Approaches: Denver
23

24. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
• Funded by 1 percent sales tax
• Local-sales tax revenue comprises 66% of the budget
• 90 miles of light rail
• Highly subsidized on per trip basis
Funding Approaches: Dallas
24

25. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
• Half cent sales tax
• $250 million local funding of $ 1.16 billion project
Funding Approaches: Charlotte
25

26. Sound Transit
• Over half of funding is local
• Multiple sources of local funding
o Sales Tax
o Motor Vehicle Excise Tax
o Property Tax
o Rental Car Tax
$580.0
$299.1
$250.1
$0.0
$200.0
$400.0
$600.0
$800.0
$1,000.0
$1,200.0
$1,160.1
Lynx Blue Line
Charlotte, NC
City of
Charlotte - In-
kind
City of
Charlotte -
Infrastructure
Funds
1/2 Sales Tax
State Full
Funding
Federal
50.0%
Local
24.2%
State
25.7%
Funding Approaches: Charlotte
26

27. Funding Summaries of Select Projects
47.7%
32.7%
59.4%
52.3% 50.0%
6.4%
11.6%
23.8%
26.7%
25.8%
13.6%
32.4%
67.5%
11.4%
31.2%
19.8%
58.8%
20.8% 16.7% 5.0%
24.2%
48.8%
5%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Westside Purple
Line (CA)
WMATA Silver
Line Phase I
(VA)
WMATA Silver
Line Phase II
(VA)
Portland -
Milwaukie Light
Rail (OR)
Regional
Connector
Transit Corridor
(CA)
Lynx Blue Line
(NC)
Crenshaw LAX
(CA)
Federal-Grants State Local - Loans Local Other
27

28. Transit Funding From Local (Regional) Sources
28
8%
36%
43%
44%
18%
23%
56%
76%
64%
66%
39%
40%
66%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Greater Philadelphia
Peer Average
Washington, DC
San Francisco
New York
Miami
Los Angeles
Houston
Denver
Dallas
Chicago
Boston
Atlanta

29. Local and Regional Funding Sources
Type of Tax or Fee Place Tax or Fee
Sales Tax
Denver, Colorado 0.40% in Denver Regional Transportation District
Chicago, Illinois 1.25% in Cook County and 0.75% in bordering counties
Los Angeles, California 2.0%
Las Vegas, Nevada 0.25% in Las Vegas
Seattle, Washington 0.90% received by Sound Transit
Excise Tax Phoenix, Arizona 0.50% in Maricopa County
Seattle, Washington 0.30% of vehicle value received by Sound Transit
Property Tax Toledo, Ohio $2.5 million funding to Toledo Regional Transit Authority
Real Estate Transfer
Tax/ Mortgage
Recording Tax
Chicago, Illinois Increase in real estate transfer tax for the Chicago Transit Authority
New York, NY MTA uses a mortgage recording tax
Income Tax Lafayette, Indiana 0.02% to create funding to region
Car Rental Fees Seattle, Washington 0.8% levied by Sound Transit
Parking Fees San Francisco, California Parking fees at municipal facilities
Business License
Fees
Louisville, Kentucky 0.2% received by the Transit Authority of River City
Impact Fees San Francisco, California
Transit Impact Development Fee (TIDF)- One-time fee on development within a
delineated area
Hotel Tax Las Vegas, Nevada Room tax dedicated to the “resort corridor”

30. Success Rates of Referenda
71%
68%
69%
73%
79%
73%
77%
73%
77%
66%
65%
0% 20% 40% 60% 80% 100%
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
Referendum Approval Rates2016 Approved Ballot Initiatives
SEATTLE, WA
$54.0B Sales &
Motor Vehicle Tax
LOS ANGELES, CA
$120.0B Sales Tax
ATLANTA, GA
$2.5B Sales Tax
30

31. Potential Local and Regional Funding Sources
PA Only Regional Estimates
Tax Tax Rate
Annual Revenue-
Year 1 (millions)
Bondable Amount
(millions)
Annual Revenue-
Year 1 (millions)
Bondable Amount
(millions)
Regional Sales Tax
Revenue (All)
1.00% $280.0 $3,210 $392.2 $4,496
Regional Sales Tax
Revenue (Motor Vehicles
Only)
1.00% $50.0 $610 $70.0 $854
Real Estate Transfer Tax 1.00% $180.0 $2,060 $252.1 $2,886
Property Tax Surcharge 0.10% $350.0 $3,970 $490.3 $5,561
Tolls $0.01 / mile $50.0 $620 $70.0 $868
VMT Tax $0.01 / mile $230.0 $2,660 $322.2 $3,726
Regional Fuel Tax 6.00% $150 $1,700 $210 $2,381
Regional Personal Income
Tax
0.10% $120 $1,410 $168 $1,975
Earned Income Tax
Surcharge
0.10% $100 $1,090 $140 $1,527
Telecommunications
Surcharge
$1 per month $30 $470 $42 $658

32. For Less the Cost of a Cup of Coffee a Week
32
Annual
Revenue
Bondable
Amount
Comparable
Tax
$1/week
($52 per year)
$217 million $2.5 billion Half-cent sales tax increase
$2/week
($104 per year)
$436 million $4.9 billion Property tax surcharge of 0.1%
$3/week
($156 per year)
$653 million $7.4 billion 2 cent sales tax increase

33. Value Capture
33
The King of Prussia Rail Project
• Transit Revitalization Investment District (TRID)
• City Revitalization and Improvement Zone (CRIZ)
• King of Prussia Business Improvement District (BID)
Tax Tax Rate
Annual Revenue- Year
1
Aggregate
Amount
Value Capture –
TRID
All incremental
property taxes
$0.6 to $1.1 million $135 to $235 million
Value Capture –
TRID (State)
$350,000 per year $0.4 million $4 million
BID
Assessment
0.10% $1.3 million $19 million

34. The Importance of a Unified Vision
• New investment is constrained by lack of local
funding sources
• One-size may not fit all
• Need for a shared vision
– Not necessarily a single funding source
• Infrastructure takes time—compelling vision and
timeline allows all areas to participate
34

35. 35
Questions?
Richard Voith
President, Econsult Solutions
voith@econsultsolutions.com
Thank you