Federal eTOD : Promise and Peril
While headlines across the Country, and especially in Washington D.C., have rightfully been focused on racial justice and police brutality some potentially significant federal proposals are moving through Congress and the administration that, if enacted, will have significant long-term impacts on housing affordability, public health, and climate change. Each requires attention, and despite the heaviness and trauma of the times we live in, all benefit from being shaped by people who will be directly effected by the practices they will formalize, the funding that will be spent, and the impacts that will be felt for generations to come. Like much of American society, these impacts will be most felt in BIPOC communities.
First the good news: Federal Transportation Reauthorization Prospects
I cut my planning teeth on federal transportation policy with my first job out of graduate school being at the Federal Transit Administration while ISTEA was being enacted, and later on Capitol Hill as SAFETEA-LU was being drafted. Since then, what should be a five-year reauthorization cycle has become anything but reliable. Instead, it’s a bit like the boy who cried wolf as we hear about the impeding deadline (the current authorization, the FAST Act expires Sept 30, 2020), the depletion of the Trust Fund (ten years of insolvency to be precise), and the now tired drumbeat for action and reform.
One thing we can depend on, there will be a catchy acronym!! The Senate started its reauthorization work last year with the America’s Transportation Infrastructure Act (ATIA), and earlier this month the House Democrats released their proposal, the Investing in a New Vision for the Environment and Surface Transportation in America (INVEST in America) Act.
Numerous national organizations and trade associations have dissected these bills and will continue to monitor their progress. For mastery of details and relatively objective analysis, Jeff Davis at Eno Transportation cannot be beat. For a focus that aligns most closely with my policy priorities, Beth Osborne at Transportation for America is my go-to source. Overall, the House bill is the strongest climate transportation bill that we’ve seen, even though it still allocates almost 80% of funding to the highway side of the ledger. Given greening of what defines highway and mobility that is sprinkled throughout the bill this spending split is not quite so egregious.
Overall funding for transit increases 47 percent, which is notable. More notable though is a refocus on transit’s purpose and how formula funds are allocated. As T4America notes, “For years, federal funding for transit has incentivized lowering operating costs—where can transit be built the most cheaply, how can it be run for the least cost, etc.—instead of building transit that is most useful to people. But no one ever chose to ride transit because its construction costs were low—frequent service and reliability are what people care about. The INVEST Act flips these incentives to focus on frequency of service that will encourage more people to choose to ride.”
Given the work that MZ Strategies does with communities across the country to support equitable transit-oriented development (ETOD), there are a few highlights from the House bill that are worth calling out. I am pessimistic about the bill’s final passage, but it includes some notable reforms and innovative concepts that are important to support. I learned early on working with Congressman Blumenauer that federal legislation is like a vampire, it never really dies. Ideas with broad enough support continue to live on, even though they may evolve through the legislative process.
Transit is nothing without the public. Numerous changes in the INVEST Act recenter the federal transit program on the people who rely upon it. From adjustments to improve service for people with disabilities, including allowing paratransit riders to make essential stops to drop kids off at daycare or stopping at the pharmacy; to incentivizing frequency in the urban formula bus program. My favorite though is this new addition “Supporting All Riders Sec. 2501. Low-income urban formula funds. [49 USC 5336(j)] Doubles the urban formula low-income set aside from 3 to 6 percent. Expands the formula to include an emphasis on the low-income population in urban census tracts with a poverty rate above 20 percent. Requires transit agencies to ensure they are serving low-income individuals.”
Transit-Supportive Communities. (Section 2701) Thanks to Congressman García (IL-4), who earlier introduced ETOD stand-alone legislation, the House bill includes an entire new section within the Transit Title that establishes an Office of Transit to “make grants, provide technical assistance, coordinate transit-housing policies across the Federal government, and incorporate strategies to promote equity for underrepresented and underserved communities.”
Eases the ability to re-purpose surplus land for affordable housing. (Section 2702) Proposed changes would allow FTA grantees to transfer property no longer needed to a local government authority, non-profit, or other third party for the purpose of transit-oriented development. Most importantly, it releases the Federal interest in that asset, which has been a major barrier to redevelopment. In order to utilize this flexibility, at least 15 percent of the housing units in such a project must be offered as affordable housing. For transit agencies like Sound Transit and BART who have aggressively been pursuing affordable TOD, this is surely welcome news. But even for smaller transit agencies who have purchased land for maintenance facilities or other purposes where redevelopment may be a better use this is important.
Incentives to pursue affordable housing when expanding transit. (Section 2703) Important adjustments were made in past authorizations and federal guidance to introduce consideration of affordable housing when new transit lines are being planned. The INVEST Act takes this further by providing multiple incentives in the Capital Investment Grant program’s rating process so that projects with greater commitment to affordable housing preservation and development are more competitive. It also explicitly allows Economic Development Administration (EDA) Public Works grants and Department of Housing and Urban Development (HUD) Community Development Block Grants to be counted as part of the local share, provided that the funds are used in conjunction with an affordable housing development.
Redefining joint development. (Section 2102) The INVEST Act amends the FTA Joint Development Program to remove the fair share revenue requirement for transit-oriented development projects that include 50 percent affordable housing. Affordable housing advocates have long advocated for this change given that it stymied the ability of non-profit housing groups to work with transit agencies on projects that included discounted land agreements.
Bringing art back into transit. (Section 2103) For years, beginning with ISTEA, transit funding could be used to support local artists in designing and beautifying transit stations and stops. You may recall poetry inside MTA subway cars, stunning mosaics at Seattle’s bus terminal, or etched glass work in bus stops that helped to brand transit and create a safe but lovely place to wait. The FAST Act prevented the use of transit for such funds out of mean short sightedness. Art in transit is a powerful tool to engage community, affirm local culture and identity, and make transit a foundation of neighborhood identity.
Finally, look for ETOD-supportive provisions in the Highway title, too. (Title I) A number of new programs such as the Community Climate Innovation grants, or adjustments to popular programs like Transportation Alternatives and even federally-required planning considerations, elevate projects that can reduce greenhouse gas emissions, connect housing and land use with transportation, and elevate equity impacts. That sure sounds like ETOD to me, especially if we think about the issues of access, safety, resiliency and connectivity that are needed between transit stations and surrounding neighborhoods.
** If these are provisions you support, consider reaching out to your Congressional representative to voice your support or with those organizations who are tracking the legislation to learn more. **
Now the bad news: Dismantling Environmental Protections and Affordable Housing Finance Systems
Choke on it. It sounds like a bad joke, but it is unfortunately true. At the same time we are in the midst of a global health pandemic, which many scientists believe is connected to climate change and the loss of natural habitats, the Trump administration has proposed weakening the three foundational pillars of America’s environmental policy: National Environmental Protection Act (NEPA), Clean Water Act, and the Clean Air Act. On June 4, EPA proposed to narrow interpretation of the Clean Air Act with public comment open until July 2, 2020. Their proposal essentially elevates economic impacts over environmental impacts.
For my entire career, each transportation bill included provisions and every new administration has taken efforts to “streamline” our national environmental protections. We seem to forget that the reason these were enacted in the first place is because people were dying from poisoned water, poisoned air, and poisoned land. These laws are designed specifically to slow down projects to allow time to evaluate their potential impacts, to identify mitigation strategies if needed, or to halt projects that should not happen given their anticipated harm to the planet and people. The latest announcement by EPA is quite simply an attack on public health, and a doubling down on environmental destruction. The fact that its strongly supported by the American Petroleum Institute seems to prove my point.
Our environmental crisis and our racial justice crisis are inextricably linked. As recently called out by Mary Annaïse Heglar, “It’s been documented again and again that climate change hurts Black people first and worst — both in the United States and globally. Moreover, Black people did the least to create the problem, and our systemic oppression runs directly parallel to the climate crisis.”
What housing crisis? Talk about adding insult to injury. Millions of Americans are struggling to pay their rent and worry about their mortgage because of COVID19’s economic recession. This comes on top of a growing housing affordability crisis impacting large and small communities where decades of insufficient housing production and stagnant wages has created record numbers of families to be housing cost burdened. We need more funding and innovative finance tools to preserve, modernize and build more housing for low to moderate-income households, and to address the nation’s homelessness challenges. Yet this administration continues eating away at the few housing finance programs we currently rely upon.
The 4% Low-Income Housing Tax Credit, the most utilized tool today for building new housing cannot currently compete with the market given current historically low-interest rates and changes made in the 2017 tax bill. It no longer provides a financial incentive even for developers who want to build affordable housing. Recent unilateral reforms taken by the Office of the Comptroller of the Currency to the Community Reinvestment Act are anticipated to have a disastrous effect on community development. Among the changes is broadening the definition of what finance activities qualify as a community benefit. It also streamlines the new performance metric, which may not reflect the true investment in low- and moderate-income communities. The final rule was rushed to the finish line, without anything resembling a reasonable amount of time to process and respond to the thousands of comments received, nor the shifting housing finance landscape that COVID19 is creating.
And on top of all this, the Federal Housing Finance Agency has issued a proposed rule to reform Freddie Mac and Fannie Mae that will make it harder for low-income prospective homeowners, especially BIPOC households, to buy a home. The National Housing Conference has a terrific overview of the link between the GSE capital rule and racial justice. Let me be clear, none of the aforementioned housing finance tools were working particularly well for households of color, especially for Black families who have the lowest homeownership rates and suffer the highest rates of eviction and rent cost burden. We need to radically change our national approach to housing. (Rep Maxine Waters, Chair of the Housing Financial Services Committee, has a bill, HR 5187 the Housing as Infrastructure Act, that begins to walk that path.) But instead this administration is severely weakening the existing tools we have while not putting forward anything in return. Their actions are designed to make an unfair and insufficient system that much worse, while benefitting those who need it the least.
So much is happening in our nation right now. Use your voice and use your vote to convey to policy makers the issues that matter to you. The future depends on all of us remaining silent no more