Atlanta’s BeltLine: Ambitious Plan Fit for Atlanta

By Anonymous

Between 2000 and 2010, Atlanta was the 3rd fastest growing city in the country (behind Houston and Dallas).[1] Attracted to a cheaper cost of living and temperate climate, Atlanta added over 1M people to a population of 4M. However, the rapid increase has worked to tax an already strained city transportation infrastructure.

This suburban-centric view has started to change in the last few years with the ambitious Atlanta BeltLine project. The project, based on a Georgia Tech graduate student’s 1999 thesis, will be, by many accounts, the “most expensive rails-to-trails project”[i] in the country.[2] Advocates of the new emphasis on walkable cities, led by Charles Leinberger of the Brookings Institute, highlight the numerous advantages of investing in the infrastructures at the center of cities around the country – mainly lower transportation costs [and] higher transit access.”[3] Atlanta’s BeltLine project will connect 45 neighborhoods, increase parkland by 40%, and add 22 miles of transit lines to a geographic expanse that covers 22% of the city’s population and 19% of its landmass.

While the project has been received with relatively open arms, there are still a number of challenges to be overcome and issues still on the horizon. First, and most important, would be funding. A July 2012 referendum proposing to use an estimated $600M in revenue from a penny sales tax to primarily fund streetcar investments in the downtown area was rejected. As of last month, only ~$350M had been raised for an estimated $2.8B project. These funding challenges will continue to shape and possibly scale back many of the most ambitious elements of the proposal (e.g., streetcar connections).

The second challenge concerns what to do with residents who may be priced out of their neighborhoods. Charles Leinberger describes a five-step ladder of walkability – each step up the ladder, on average, adds “more than $300 per month to apartment rents and nearly $82 per square foot to home values.”[4] These increases, though certainly positive in many regards, could drastically change the makeup of neighborhoods as more educated and more highly paid individuals flood into areas that have been historically overlooked.

Despite these challenges, the promise of the BeltLine presents a bright and optimistic future for the city of Atlanta. Building on the investments that accompanied the 1996 Summer Olympics and the $2B+ in investments in Atlantic Station (a mixed use redevelopment in the heart of the city) that began in 2001, the core of Atlanta is undergoing massive changes that will continue attracting new residents in search of better lifestyles and comforts from around the country.

[1] Carnathan, Mike, “Employment and Socioeconomic Trends along the Atlanta BeltLine”.

[2] Brown, Robbie, “Now Atlanta is Turning Old Tracks Green,” New York Times, Feb. 14, 2013.

[3] Brookings Institute, “Walk this Way: The Economic Promise of Walkable Places in Metropolitan, Washington, D.C.” May 25, 2012.

[4] Leinberger, Christopher B., “Now Coveted: A Walkable, Convenient Place,” New York Times, May 25, 2012.

[i] Rails-to-trails refers to the conversion of unused railroad tracks into usable spaces (e.g., parks and trails)

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3 thoughts on “Atlanta’s BeltLine: Ambitious Plan Fit for Atlanta

  1. After living in Atlanta for close to three years, I can say that the Beltline is a fascinating project with transformative potential to create a far more livable city in the future. In light of its proposed benefits, the author raises several valid concerns over (i) how the Beltline will be funded and (ii) the impacts that increased land value will have on housing affordability in neighborhoods adjacent to the project.

    One way to address these issues could be through issuing “Certificates of Additional Construction Potential” (CEPACs); an instrument pioneered in Sao Paulo, Brazil to create public benefits from private development projects. CEPACs are instruments used by municipalities to get developers to compensate the city for the cost of infrastructure needed to support new development. The main idea behind a CEPAC is to create development rights for “upzoning” in a specified area that allows for additional development and then to sell these rights to developers to raise funds that will finance infrastructure construction as well as public amenities, such as parks and affordable housing [1]. Sao Paulo drew several distinct “zones” where CEPACs would be allowed and implemented and then used subsequent revenue to finance neighborhood infrastructure in these districts as private developers moved forward with their projects.

    In this vein, it seems to me that the City of Atlanta should consider a similar approach to financing the Beltline and related projects. Clearly, the addition of so many parks and miles of bike trails and light rail will add value to the surrounding neighborhoods and create attractive development opportunities, such as TOD-oriented housing, retail, and commercial buildings. Atlanta could create “CEPAC districts” in high value areas, for example around specific transit nodes and parks. Instead of solely relying on taxes – which impacts largely everyone – the City could use CEPACs to raise funds that ease the Beltline’s financing burden, improve the profitability of private development opportunities, and mitigate land value impacts by supporting and encouraging affordable housing development A condition of CEPAC sales.

    [1] “A New Instrument of Value Capture in Sao Paulo – Certificates of Additional Construction”; Lincoln Institute of Land Policy; https://www.lincolninst.edu/pubs/2064_A-New-Financial-Instrument-of-Value-Capture-in-São-Paulo

    • By John Macomber

      The CEPAC idea is very interesting in terms of figuring out a straightforward way to create value, capture value, and distribute value. The site quoted goes on to say,

      “CEPACs are auctioned off by the Federal Bank of Brazil and can be used only in a designated urban operation area that a city government has targeted for public investments…from 2004 to 2009 the total income collected from selling CEPACs in Faria Lima and Agua Espraiada, São Paulo, was R$1.62 billion (US$812 million).”

      If coupled with explicit FAR increases for the developer and a specific plan for how the infrastructure capital would be spent by the city, this could be quite a crisp system. If overlaid with some of the other incentives available to cities (for example a tax break for corporate tenants or real estate promoters), the planned space could be made more valuable and thus extract higher prices for the same CEPAC rights and in turn allow for more construction of beneficial parks and infra to the benefit of all the citizens or even directed toward housing for poor people…if the financial structure works.

      This is quite a bit of up-front and transparent value capture ahead of the project. Compare to a) no added value b) up front informal payments to somebody to get development rights or c) hoping that future property taxes on the added footage are applicable to paying off infra debt incurred earlier. If it works the CEPAC leads to transparency, flexibility what the city uses the funds for, and time-shifting in the flow of funds.

  2. I am a bit less optimistic about the Atlanta BeltLine plan as it stands. While the vision is tremendous, there are two points of execution that it lacks which may prove fatal to the overall success of the project.

    First, the city has explicitly committed to not make any underlying changes to the zoning of the property within the project zone, prohibiting any increases in density or changes in permitted use. Without the ability to grow and change the supply of places to live, work and play within walking distance of the transit stops, the scale of the impact of the project is unnecessarily constrained, as the majority of residents will continue to drive to and from their places of work. This point also speaks to the affordability concerns you mentioned in your post.

    Secondly, the city has not decided to support the more walkable lifestyle facilitated by transit access with a market-based approach to parking prices and support. While the city has proposed cosmetic changes to mitigate the eyesore that is urban core off-street parking, as long as parking is free and plentiful (as required by city parking minimum laws), urban development will be necessarily constrained and drivers will continue respond to the parking subsidy with overuse of personal vehicles.

    These decisions completely undermine the “transit oriented development” strategy the project claims to take, and Atlanta unfortunately appears poised to repeat the mistakes made by many other cities across the country in their transit development strategies.

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