Value capture gets a laugh from skeptical APTA audience

I was struck by the frank discussion regarding the difficulties of implementing value capture in a recent Streetsblog post about a session at the APTA-NY conference.

During the panel, Weisbrod said the city is interested in using real estate development to provide funding for transit improvements, a strategy known as “value capture” that Trottenberg has suggested before. “We’re going to see that, I hope, in our East Midtown project… where we’ll see development that will commit $250 million to the Lexington Avenue subway station,” Weisbrod said. “Once it goes through [the city's land use review process], it will be one of the more secure parts of the capital budget.” The audience chuckled.

Development tied to the city’s most recent value capture project, the 7 train extension to Hudson Yards, has struggled to meet expectations. As a result, city taxpayers have spent millions on a project that was originally supposed to be paid for by developers.

This is reminiscent of a discussion in CityLab one year ago:

As King writes, subsidizing private development on a site where property value will rise is "exactly the opposite" of capturing that rising value for the public good. So New York is no master of value capture just yet, but there's no reason it (or other U.S.) cities can't become one in time.
 - 3 Missed Chances to Pay for New York's Subway Expansions, CityLab, 11/12/13

The Crain's article (link above and here) is well worth a read. It speaks to the political economy of value capture: Developer seeks development rights, proposes investments in transit, public-private partners consider the costs, a public board raises concerns about the cost estimates, and very little is actually said about determining the value of the transit access or development rights.