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1. Larry Miller - December 13, 2006

The following was posted on the Richmond Home Builders Association blog in response to an editorial touting toll roads as the solution to our transportation problem…

Half of the my free market mind says “Right on, brother, preach it!” The other half says, “Wait a minute here!”

The reason for this is that on one hand, we balance the time saved and it’s value against the cost of using toll roads. On the other hand, in some ways, we see the development community looking to have access granted to their projects at someone elses expense.

With an imperfect profer system, and they are all imperfect, the developer (and his customers) help pay for the impact of the new project on the community. The balance is extracted from the pockets of the existing taxpayer base.

With toll roads, this still happens, but with with a disproportional impact on existing motorists, who suddenly find themselves surrounded by many new drivers they did not invite and from whom they’ve drived no economic benefit.

You might say this is the price of progress, but when the government cannot, or will not find sufficient revenue from commercial development to balance residential development, as is the case in Chesterfield County, the cost invariably is borne by Joe Taxpayer.

What we have is happy builders because their problem has been solved, happy officials beause they have delivered for their contributors, but unhappy citizens because they ultimately pay for all this… through taxes, tolls or fees.

2. Tyler Craddock - December 17, 2006

Larry,

Thanks for your comments over at Growth is Good. I would, however, clarify one item. In your post above, you state that we are “touting toll roads as the solution to our transportation problem…”

What we are pointing out is that toll roads are one of several items that should be considered.

To wit: “Like several ideas being discussed, such as congestion pricing and HOT lanes, tolls deserve serious consideration as part of the answer to solving the transportation challenges facing our Commonwealth.”

To that list, I would add several items already being discussed, such as Community Development Authorities (CDAs), Service Districts and the dedication of increasing real estate tax revenue streams.

3. Larry Miller - December 18, 2006

I guess the problem we have is that no matter how you cut it, somehow it falls to the taxpayers to foot the bill for the transportation required to make developments work. I notice there was not mention of impact fees or increased profers.

By using things like ‘dedication of increasing real estate tax revenue streams’ we either end up with higher tax rates or funds shifted from existing tax revenue away from other competing projects.

What it comes down to, is that for the system to work in Chesterfield, we need to take a much more serious and effective approach to economic development so the tax base includes significantly more commercial revenue than we currently have.

4. Tyler Craddock - December 18, 2006

Two of the items above, CDAs and Service Districts, directly charge users of a given system for infrastructure. Also, to this point, there is no mention of the many different stream of revenue genrated by development. To that end, a new post over at http://www.growthisgood.info scratches the surface of that issue.

5. Larry Miller - December 20, 2006

No one is denying that there are some economic benefits of development, however the fact remains that the cost to the taxpayers is greater than these beneifits… otherwise we would not see increased taxes, fees, tolls and the like.

Given the arguements against tolls, I would look at CDAs and Service Districts in pretty much the same way. For the people coming in, it may be a fair process, but for people already within those areas, not only do they get greater congestion, but they have to pay more for it. To me, this just doesn’t seem right.

6. Tyler Craddock - December 20, 2006

And that is where I believe that we differ. I believe that development does over time generate a net positive in taxes, especially when viewed in sum total of the taxes generated not only by the construction of new homes, but also by the commerical development that follows new homes.

Also, when you speak of existing residents, who paid for the infrastructure to serve them? If you check the comments section on the TOLLS post at http://www.growthisgood.info, Ray Hyde raises this point and puts on the table an interesting point of discussion with regard to this issue. I do not always agree with Ray, but he always injects things worth discussing into the dialogue.

7. Tired Guy - January 15, 2007

There are too many variables from locality to locality to make a blanket statement regarding whether “development” pays for itself over time. In a locality such as Chesterfield, with many new infrastructure needs and a high rate of children per household, it almost certainly does not. In another locality, maybe it does.

In general, I think tolls are a bad deal for a locality and its taxpayers – but a great deal for the state. Usually, tolls roads are built so that a needed road can be built sooner than the state is willing or able to build it. It makes sense under those circumstances for drivers to pay a “user-fee” to use this toll road. However, the problem is that the state is off the hook forever, rather than just for that period of time prior to when the state would have built it if not for the construction of the toll road. For example, if Chesterfield had not agreed to the Powhite extension (with tolls), eventually the state would have had to build it without tolls, or else make extensive and costly expansions of other roads such as Rt. 60 and Rt. 360. By agreeing to build the extension earlier with tolls, Chesterfield drivers get to pay it off in its entirety, well beyond the time that it would have been built for “free” by the state. If the state took over the bonds after 10 years, or some appropriate length of time, I’d have no objection to toll roads, but under the current system, toll roads are a bad deal for the taxpayers that use them.