Mobility Fees Encourage Transit-Oriented Development

Daily Business Review
November 17, 2017

A number of county and municipal governments in the state of Florida and throughout the nation, including Hillsborough County, Jacksonville, Sarasota County, Orlando, Seattle, Portland, Oregon, and Boulder, Colorado, have moved in the direction of establishing mobility fees to fund multiple modes of transportation.

Just last year, the Florida Department of Transportation issued a comprehensive guidebook on how to use mobility fees to fund transit improvements.

A mobility fee is a one-time capital charge imposed on developers to pay for their share of the impact stemming from residential and commercial projects. Fees are paid only once based on land use and size, but the mobility fee differs from the traditional road impact fee in that revenue from mobility fees can be more broadly applied to several modes of transportation such as public transit, not just roads.

The shift will also combat urban sprawl by discouraging new road construction by steering development to areas where infrastructure already exists. The goal of the mobility fee shift is also to control road maintenance costs from spiraling further out of hand.

The policy shift toward mobility fees thus allows traditional roadway impact fees collected from new development to be invested in a broader multimodal system approach that transcends roadway capacity.

Mobility fees provide a more equitable and efficient way for new development to mitigate its impact and can provide a flexible revenue source to fund a multimodal transportation system that includes transit, bicycle lanes, sidewalks, trails and roadways.

Mobility fees can also be structured around localized traffic and development patterns and hence can serve to incentivize development in the transit-supported urbanized areas.

The mobility fee trend appears to have landed in South Florida, which just surpassed 6 million people for the first time. In search of transit solutions, the Miami-Dade Mayor Carlos Gimenez recently issued a report that mostly went under the radar but is a potential harbinger of a huge shift in policy that will affect every single real estate development in Miami-Dade County.

While South Florida municipalities and Miami-Dade County in particular are aggressively pursuing transit solutions, the county has never used mobility fees and instead has relied on the more traditional road impact fees.

As a result of the 1985 Growth Management Act that mandated local comprehensive development plans be consistent with regional and state plans and introduced minimum level of service standards for public infrastructure and concurrency, Miami-Dade County introduced impact fees as a growth management tool.

Miami-Dade’s existing road impact fee ordinance was adopted in 1988 to ensure that roads are maintained within each of the defined benefit districts. Again, the road impact fee is determined in proportion to the amount of new demand that will be introduced onto roads and perpetuates the historic view of prioritizing roadway construction, treating it as independent of transit and other mobility modes.

Even though Miami-Dade County has the ability to use road impact fees on select transit capital improvement projects, the focus of impact fee expenditures remains on roads.

Like many traditional fee systems in Florida and around the nation, Miami-Dade County’s public works function has also been primarily funded from road impact fees, a structure that is predicated on private vehicles as the primary mode of transportation.

However, the establishment of a mobility fee that promotes development around existing and planned transit corridors can be a significant tool to further incentivize transit-oriented development as well as promote ridership on our transit system.

The mayor’s report in conclusion recommended modifications to existing impact fee ordinances and the creation of new mobility impact fee programs that would be more appropriate to address the unique impacts of transit-oriented developments and fund transit capital improvements.

Constructing mobility fees to recognize available transit and transportation alternatives is the next significant step in encouraging further development of modern mixed-use development in proximity to transit nodes in Miami-Dade County and other municipalities in need of meeting transit demands tied to population growth.

With several large metropolitan areas approving mobility fees and the Department of Transportation’s adoption of a comprehensive guidebook on how to use mobility fees to fund transit improvements, mobility fees are fast becoming an import tool for public transit and transit-oriented development.

This article is reprinted with permission from the Daily Business Review.

Related Practices
Publication May 19, 2014
The use of public-private partnerships (P3s), especially in the transportation sector, is gaining steam in South Florida.
Press Release November 16, 2018
The Miami-Dade County Mayor and Board of County Commissioners proclaimed November 8th, 2018 as “Bilzin Sumberg Day.” This honor recognizes the Firm’s talented and passionate group of professionals as well as its deep commitment to the South Florida community.
Speaking Engagement January 26, 2018
Eric Singer is a panelist at the Greater Miami Chamber of Commerce Transportation Summit. He discusses best practices for funding the Strategic Miami Area Rapid Transit Plan, including innovative approaches beyond tax increment financing.