Summary

• Peter Vollrath [4]September 6, 2006, 8:00 pm

In March, the Berkeley Transportation Commission unanimously passed a motion asking for a transportation services fee (TSF) to be approved by the City Council [1]. The fee would be levied on commercial and residential projects to mitigate the impact of traffic generated by the new construction. It would also partially fund efforts to encourage alternatives to personal automobile transportation. In June, the Planning Commission reversed their earlier position and voted 5-4 urging the City Council to reject the program [2]. In July, the City Council debated the proposal but came to no decision [3]. Instead, Council voted unanimously to continue the discussion with a workshop on October 10.

The Issue

The City of Berkeley is considering whether to make developers pay for the impacts of automobile trips generated by their developments through a transportation services fee (TSF). Assessed on new construction and certain change-of-use projects, the TSF would be based on the number of new auto trips generated by the building. Proceeds would be used to support programs designed to reduce traffic through alternative transportation modes. [5]

Though the city had a TSF in effect between 1985 and 1997, this time there is considerable debate over whether the proposed fee is being applied fairly, whether it will drive business out of Berkeley, and in fact, whether it will increase or decrease the amount of traffic.

The TSF Proposal

The City of Berkeley seeks to reduce traffic. Traffic congestion is consistently among the top concerns cited by residents about living in the Bay Area. Moreover, carbon dioxide emissions from traffic account for a significant portion of all greenhouse gas emissions.

In other cities, measures to mitigate traffic impacts have traditionally focused on widening roadways and enhancing intersections, funded by property tax increases on all property owners. The City of Berkeley, however, seeks to mitigate these impacts by providing alternatives designed to reduce traffic. Proposed traffic reduction alternatives include carshare programs, improvements to transit services, better pedestrian and bicycle facilities and expanding the successful EcoPass program which provides free transit passes to employees or residents.

Imposed on new development and change of use projects, the TSF would partially fund these programs. The TSF would generate approximately $100,000 to $300,00 per year, with additional funding coming from grants and other City funding mechanisms.

The proposed fee structure is also designed to encourage development which minimizes new traffic. For example, the fee would be discounted for projects which provide free transit passes or carshare memberships for all employees or residents of the building.

Because the TSF increases the cost of development, the value of land suitable for development would decrease accordingly. In theory, developers would end up paying the same, developed property values would not change, and the TSF would have transferred value from land to the transportation infrastructure. However, this would not happen immediately: developers who purchased property before the imposition of the TSF would not benefit from the reduced land value, and so a 30 month phase-in period is being proposed.

TSF's are not unusual. Many cities such as Emeryville and Fremont impose them, and a few comparisons show Berkeley's fees to be less than or equal to theirs. However, comparisons are difficult to make. These cities base their TSF on the floor area of the building, whereas Berkeley's TSF will be based on a formula involving the number of auto-trips which a building generates as well as the type and location of development.

Basing the TSF on the number of trips ties it to the actual burden on the city's transportation infrastructure. With a per-trip fee, a developer could reduce the impact on the city AND reduce their fee by paying for good transportation demand management programs, Similar programs around the country have been shown [6] to reduce trip generation by 30% or more.

The Concerns

The Berkeley City Council remains unconvinced, questioning the rationale behind the TSF. It appears that the TSF associated with a round-trip within Berkeley would be twice as high as that of a round trip of equal distance to a neighboring city. This would seem to encourage shoppers and businesses to leave Berkeley.

City Council also questions whether the TSF would be effective. The TSF Nexus Study submitted to City Council indicates that in the absence of a traffic mitigation program, Berkeley traffic will increase by 6% in the next 20 years. The study describes a traffic mitigation program costing $50M over the next 20 years which would freeze traffic at today's level. The TSF covers only 10% of that cost - the funding source of the remaining 90% remains unspecified. City Council also cited the study for focusing on traffic generated by Berkeley development. It did not estimate the number of businesses which the TSF may drive out of Berkeley, nor the subsequent increase in auto trips which Berkeley residents would need to shop out of town if development doesn't occur locally.

Perhaps the most important reason for the continued deliberation is the current economic downturn for Berkeley businesses. After adjusting for inflation, retail sales have dropped more than 15% since 2000. Several prominent Berkeley businesses have recently left town, including Cody's, Radston's, Clif Bar and Powerbar. Though they initially recommended the TSF, the Planning Commission recently reversed that recommendation, citing concerns about current market conditions and the potential for the addition of a development fee to hinder physical and economic development.

The Decision

Will the TSF keep traffic and greenhouse gas emissions in check, or will it merely drive business out of town? That issue is certainly going to weigh heavily in the Council's decision. If the TSF is perceived to exacerbate the current exodus of Berkeley business then, despite the anticipated long-term benefits, it is unlikely to survive. On the other hand, if the TSF can be crafted in a way which does no harm to the business climate, then the voices urging reduction in Berkeley's traffic and restoration of the earth's climate may carry the day.

References