[sustran] Re: FW: Land Value Taxation Event 23/04/03

[Karl Fjellstrom]

Thanks for the updates & interesting information on the US.

The 'lack of transparency' I was referring to is about mass transit
options. Transparency may be much greater in the US but even there, when
policy-makers (or was it a referendum) approve spending $180 million per
km on a metro rail system in Washington, are they really exploring all
available options in a transparent manner?

Lack of transparency often means a lack of information about how public
money is being used. A good example is the comment below that
'government institutions are not really involved' in the Bangkok
Skytrain. If only ... In fact, the government is paying for the
infrastructure for Skytrain extensions; 2km to open next year and a
further 17.2km approved. It's probably only through the ongoing intimate
involvement of the government that the system is still operating, as it
has never covered its operating expenses plus interest costs.

Even if there were perfect transparency, however, it's true that the
interests of powerful landowners - as described below - would probably
keep something like value capture off the political agenda anyway, at
least in Bangkok.

Regards, Karl Fjellstrom



 

-----Original Message-----
From: owner-sustran-discuss at jca.ax.apc.org
[mailto:owner-sustran-discuss at jca.ax.apc.org] On Behalf Of Craig
Townsend
Sent: Sunday, 25 May 2003 4:23 AM
To: sustran-discuss at jca.ax.apc.org
Subject: [sustran] Re: FW: Land Value Taxation Event 23/04/03


Eric makes good points about the US. Similarly, in Canadian cities the
level 
of transparency surrounding mass public transport projects (usually
rail) is 
very high. Costs of public transport projects and operations are the
subject 
of a high level of public scrutiny and debate. There is a big debate
going on 
now in Vancouver about a proposed rail line, and due to extensive news 
coverage anyone who reads the newspaper has a good understanding of the
costs 
involved and the various debates surrounding the project: e.g. see
today's 
Vancouver Sun newspaper http://www.canada.com/vancouver/story.asp?
id=30BD1DF4-E7CC-42BD-AA5C-D3D310ACF9E0). The level of transparency 
surrounding road projects is typically much lower. 

One point that I would like to make about value capture is that it is
worth 
clarifying who is capturing value. A form of indirect value capture by 
government (and hence in theory all sectors of society) from transport 
infrastructure improvements does occur in Australia because the
improvements 
raise the market value of adjacent lands. Those increases are reflected
in the 
level of property assessment and will result in more tax revenue to the 
government. The situation is different in Bangkok where there are only
small 
administrative charges on land owners, but no taxation based on assessed

market value. The Bangkok Transit System is a privately owned and
operated 
rail rapid transit system. The owners of the system make deals with
other 
corporations, businesspeople, and landowners to mutually increase their 
revenue, but government institutions are not really involved. 

Craig Townsend

Quoting Eric Bruun <ericbruun at earthlink.net>:

> 
> I want to point out that in some places, public transport agencies are
> specfically not allowed to use land value capture. It would take 
> changes in laws first.
> 
> Secondly, the lack of transparency about costs for public transport
> projects is certainly not true in the US. The Federal government 
> requires all kinds of documentation about local/state contributions 
> and about future operating cost supports for public transport projects

> before it contributes. This is then used by the highway lobby to point

> out how expensive public transport is. But the truth is that there is 
> no matching requirement for highway projects, especially not about the

> operating and maintenance costs. This is good for the highway lobby, 
> because much of the operating support comes from property taxes and 
> general taxation, not from user taxes.
> 
> Eric Bruun
> 
> ----- Original Message -----
> From: "Karl Fjellstrom" <karl at dnet.net.id>
> To: <sustran-discuss at jca.ax.apc.org>
> Sent: Friday, May 23, 2003 5:05 AM
> Subject: [sustran] Re: FW: Land Value Taxation Event 23/04/03
> 
> 
> > Dear Paul & Craig, sorry for the delayed response.
> >
> > Bogota implemented a value capture scheme along the TransMilenio
> > (www.transmilenio.gov.co) lines which was apparently (according to
> > the Mayor of the time) successful in recouping some of the windfall 
> > gains which accrued to land ownwers along the TransMilenio route. 
> > This value capture is an important part of the funding arrangement 
> > for the ongoing expansion of the system.
> >
> > The COO of Bangkok's Skytrain system in March gave a presentation to
> > the Thai-German Chamber of Commerce where he outlined major 
> > increases in property values in proximity to the Skytrain stations; 
> > especially for commercial premises like shopping malls. Responding 
> > to a question, he said however that there was no plan for any kind 
> > of tax/charge to capture the windfall gains to the owners of these 
> > premises, but that they to some extent capture these gains by 
> > imposing charges for the commercial premises to establish walkway 
> > connections to the Skytrain stations.
> >
> > Similarly in Brisbane, when it is proposed to the transit officials
> > express strong interest in some form of value capture to fund system

> > expansion, though nothing like that has been implemented there. 
> > What's the catch? Here's my conspiracy theory: there is often an 
> > incredible dearth of transparency and open debate surrounding all 
> > issues of mass transit system cost, especially when it comes to rail

> > metros. It's only when there is no financial black hole to hide, 
> > such as in Bogota's bus rapid transit system, that you might see 
> > these options openly canvassed. (Political commitment helps too, of 
> > course...)
> >
> > Regards
> > Karl Fjellstrom