ULI Sees Hope in Infrastructure Partnerships

ULI Sees Hope in Infrastructure Partnerships

Last updated: May 31, 2009 05:13pm
ULI Sees Hope in Infrastructure Partnerships
By Bob Howard


Perez
LOS ANGELES-A new generation of public-private partnerships could emerge in the coming years as a means of rebuilding California's aging infrastructure, stimulating economic development, creating new jobs and setting the stage for the next round of real estate development, according to speakers at a ULI panel Friday. The event, hosted by the ULI's Los Angeles District Council, explored how planners, developers, architects and contractors can leverage federal economic stimulus funds and the $40 billion in County Measure R funds approved in November into significant growth by rebuilding roads, bridges, public transit, water lines and other infrastructure elements.

As ULI Los Angeles executive director Katherine Perez tells GlobeSt.com, public-private partnerships--in addition to replacing aging infrastructure and aiding economic development--could help set the stage for the next round of real estate development when the economy recovers. "What we're doing now is getting ready for the next cycle," Perez says. Getting ready for the next cycle, she says, "means we've got to put the new infrastructure in place for the new developments to occur."

Perez, who was a vice president of development for Forest City Development before assuming her ULI post last year, explains that public-private infrastructure partnerships differ in a number of respects from the public-private partnerships that have been employed to develop mixed-use and city redevelopment projects in recent years. Most of those developments were designed on a parcel by parcel basis, resulting in a piecemeal approach to upgrading infrastructure, but public-private infrastructure projects would be "a much more integrated, systematic approach to addressing infrastructure," she says.

Friday's ULI event included speakers who described how public-private partnerships have been used for years to build infrastructure in the United Kingdom and Canada--and in fact have become the preferred approach to repairing, replacing and developing infrastructure. The UK has been at it for about 17 years and Canada for about seven to nine years, utilizing the public-private structure to build highways, transit systems, ports, ferries, bridges, toll roads and other public systems and facilities.

As with all development, one of the crucial questions is financing, and Perez notes that speakers from the private sector on Friday expressed both an interest in financing the new generation of public-private partnerships and a concerns about their viability as investments. Among those from the private sector who spoke were former California Treasurer Kathleen Brown, now a senior adviser with Goldman Sachs & Co.; Celeste Davis, managing director of capital markets with the Royal Bank of Canada; and Laurence Pelosi, managing partner with McKinley Partners.

In essence, Perez says, the private sector financial advisers say that they are willing to participate in the public-private infrastructure partnerships but they have some caveats. "They pick their partners very carefully, and they need to be convinced that the projects will provide them with a reasonable return," Perez notes.

The public-private approach is not only welcome but is encouraged at the top levels of state government, according to Dale Bonner, California's secretary of business, transportation and housing. Bonner told the ULI crowd that with the challenges that the state faces, the state is eager to find funding mechanisms for much-needed infrastructure developments. He noted that the state, with a population of 38 million, is getting by with an infrastructure designed for a population half that size.

Perez points out that public-private infrastructure partnerships may not seem appealing to voters who have little faith in either the public or the private sector, but the ULI hopes to foster support for such partnerships through educational forums and discussions. The emphasis is on how such partnerships can help to keep people employed, promote economic development and rebuild crucial systems and facilities throughout the state. A central part of the message is that the water and sewer systems, energy grids, public facilities and other infrastructure projects are "systems that everybody uses and everybody benefits from having," Perez says.

LACMTA, developer complete Purple-Jimi Hendrix-Line, mixed-use project

LACMTA, developer complete Purple-Jimi Hendrix-Line mixed-use project

LACMTA, developer complete Purple-Jimi Hendrix-Line, mixed-use project

Last week, the Los Angeles County Metropolitan Transportation Authority (LACMTA) and KOAR Wilshire Western L.L.C. marked the completion of a joint development project at the Wilshire/Western station on the Purple Line.

The $160 million development features a 22-story, contemporary glass-walled building that includes 186 residential units and a 40,000-square-foot retail plaza. The 2.6-acre development is the second mixed-use project to be built for the Koreatown/Wilshire Center community, which is located in a dense urban area with direct connections to the LACMTA subway system and future subway connections.

Foothill Extension Granted Its $10 Million, Now Has to Determine Where That Money Will Come From

Foothill Extension Granted Its $10 Million, Now Has to Determine Where That Money Will Come From « I Will Ride Blog

Foothill Extension Granted Its $10 Million, Now Has to Determine Where That Money Will Come From
Posted by Albert

Sorting through the confusion and circus that was yesterday’s Metro Board meeting (you can follow the minute by minute coverage on our Twitter feed @iwillride), we came away with the impression that the Metro Board of Directors had chosen to delay any action on the $10 million budget item for the Gold Line Foothill Extension when they approved the 2010 fiscal year budget. That was not the case.

Metro’s Board Secretary confirmed to us after the meeting that Motion 9.4 of the agenda (which directs the CEO to allocate $10 million from the nearly $28 million in unallocated rail funds to the Foothill Extension) was approved by the Metro Board as part of the overall package of budget items that they had voted in favor of.

So now the Foothill Extension is one step closer to that 2013 opening reality. But really, yesterday’s result was more like a toe (not even a foot) in the door.

The $10 million allocation now has to come from a proper funding source, which the Metro staff will try to determine next month before the Foothill Extension can be listed in the Long Range Transportation Plan. We can only assume the proper pot of money will be the Measure R rail funds but we’ll find out when Metro let’s us know. That will be a whole other battle in itself, mainly because Metro will be forced to put up real dollars for the Foothill Extension – something the Board hasn’t done in our two decades and has rejected at every opportunity in the last year.

For those who were at yesterday’s meeting to witness the Board succumb under the pressure of a big agenda and a large crowd of passionate supporters, one can assume that the Board of Directors were saving the real talk about funding for next month. How this pays off for the Foothill Extension remains to be seen. However, upon reading the comments of the Metro spokesperson in the San Gabriel Valley Tribune, there appears to be an assurance that the Foothill Extension would get its funding.

Here’s hoping.

Experts Find That $40 Billion Transit Tax May Not Pay for All They Hoped

Los Angeles Downtown News and Information - LA Downtown News Online > News > Rating R

Rating R

(l to r) California Transportation Commissioner Dario Frommer, MTA board member Richard Katz and new MTA Executive Director Art Leahy participated in a May 13 panel discussion on Measure R. Katz warned that the anticipated $40 billion could turn out to be as little as $25 billion. Photo by Gary Leonard.
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Experts Find That $40 Billion Transit Tax May Not Pay for All They Hoped
by Ryan Vaillancourt
Published: Thursday, May 21, 2009 4:27 PM PDT
DOWNTOWN LOS ANGELES - When Los Angeles County voters passed Measure R last November, approving a half-cent sales tax to raise $40 billion for transportation projects, many saw it as a sign that the public was desperate to ease congestion.

The tax hike required approval from 66.67% of voters. It got 67.22%.

“It’s very difficult to get two-thirds approval of anything and particularly in a bad economy, which I think speaks to how dire the perception of this problem was,” said Phil Recht, chair of the Central City Association, which hosted a panel on Measure R on Tuesday, May 13, before a crowd of business and transportation leaders.

Recht, who moderated the panel at the Sheraton Los Angeles Downtown, pointed to projections that the county’s population will swell from 9.8 million to 12 million by 2030, slowing the average freeway speed to about 20 miles per hour.

If voters expected Measure R to reduce traffic immediately, that won’t happen. The Los Angeles Metropolitan Transportation Authority faces some major economic potholes on its road to easing congestion and improving the reach of mass transit, concluded the panel of experts, including new MTA Executive Director Art Leahy.

Measure R, which follows a $38.9 billion state transportation bond approved in 2006 known as Proposition 1B, puts a half-cent sales tax in place for 30 years. With the first funds becoming available July 1, the measure is expected to fund 33 transit projects — including the proposed Downtown Regional Connector and an extension of the Metro Gold Line — as well as a portion of regional street repairs and other projects.

As unemployment continues to rise and the economy continues to struggle, however, the revenue stream of sales tax dollars that was supposed to feed Measure R is suddenly thinner than anticipated, said panelist Richard Katz, a member of the MTA board.

“The $40 billion that you voted for, based on this economy, is now about $32 billion, and if it doesn’t turn around quick, it’ll be $25 billion before too long,” Katz said.

Reason to Move, Now


If Katz lamented the recession’s toll on Measure R’s ability to raise money, he said a silver lining is that lower construction costs and competition among contractors make now a good time to jumpstart infrastructure projects. As an example, he noted that a recently started expansion of the San Diego (405) Freeway high-occupancy vehicle lane came in 10% below the MTA’s anticipated cost, saving the agency $100 million.

“With three or four more projects like that, you can build another project just based on the savings,” he said.

Still, new projects will likely be difficult without further financial contributions from the state and federal governments, said panelist Dario Frommer, a former state Assembly majority leader and one of two current California Transportation Commissioners from Los Angeles County.

For Measure R to be successful, elected officials will have to leverage the county funds to obtain more dollars from the state and federal governments, Frommer said.

Recht agreed.

“Forty billion dollars sounds like an awful lot of money, but it’s still not nearly enough to fund even the 33 projects that are designated in this measure,” Recht said.

A New Leader


As the MTA attempts to implement its transportation projects amid the global economic woes, it’ll do so under the reins of Leahy, who most recently served as executive director of the Orange County Transportation Authority.

Leahy, a Los Angeles native who started his career in transportation as an MTA bus driver, still resides in and commutes from Orange County. He and the other panelists agreed that in addition to financial challenges, future transportation projects face a significant obstacle in community opposition. Leahy said he hopes to counterbalance that during his tenure with earlier and more proactive community engagement during the planning process.

For Downtown residents and workers, the benefits of Measure R may be felt most in the Downtown Regional Connector, a proposed two-mile transit route that would link four light-rail lines. The project, expected to cost at least $800 million, is in the environmental review stage and completion is likely seven to 10 years away.

If the Regional Connector is the only Measure R funded project in Downtown proper, area commuters and residents alike may have more at stake in the 32 other projects if they can divert traffic from the Pasadena (110), Hollywood (101) and Santa Monica (10) freeways, said Carol Schatz, executive director of the Central City Association.

“Downtown residents have to go other places,” Schatz said. “Any time they go some place else they’re faced with this reality. Not to mention those who don’t live Downtown who want to get here for a sporting event or a concert.”

Contact Ryan Vaillancourt at ryan@downtownnews.com.

Former City Councilman , Professor Michael Woo talks about the connection between mass transit, urban planning and the environment.

Streetsblog » Streetsblog Interview: Michael Woo

Streetsblog Interview: Michael Woo

by Damien Newton on May 21, 2009

Michael Woo has a long history fighting for a cleaner Los Angeles. In the late 1980's, he was the rare City Councilman who was also a trained urban planner and had a strong showing in the 1993 Mayoral Election coming up short to Mayor Riordan. He currently teaches urban planning at USC, and consultant to Climate Plan, a coalition promoting transportation and Land-Use strategy. Streetsblog caught up to him in the USC faculty lounge on Bike to Work Day to talk about Climate Change, S.B. 375 and what all of us can do. If you’re interested, you can read a lot more about Woo at his Wikipedia Page.

Sadly, there was a great anecdote at the end of our discussion, after the tape recorder was turned off about working with Ron “Bike Sage” Milam to become an urban cyclist himself. I guess we’ll have to wait for Milam’s Streetsblog interview to get that story on tape.

The full text of the interview is available after the jump.

Streetsblog: One of the main things we’re here to talk about is Senate Bill 375, which has been dubbed by many people as the “Smart Growth” bill. This legislation was passed last winter, and now we’re talking implementation around the state. Could you start by giving us a brief summary of what the goals are.

Woo: The goal is to tackle the number one source of Greenhouse Gas emissions here in California, which is the transportation sector. 40% of all of the Greenhouse Gas emissions produced in California are transportation related, and the largest share of the transportation-related emissions are caused by the cars and light trucks which most people use for their daily trips.

I work with a statewide coalition called ClimatePlan which was organized to advocate land use and transportation strategies to address climate change. In many discussions about climate change, you hear a lot of talk about demand for electricity, the need for alternatives to burning coal, energy conservation resulting from green building techniques, and of course the negative effects of our reliance on oil. But many times you don’t hear much about the impact of the transportation choices which are caused by our land use patterns.

Climate Change’s position is if we’re going to be serious about Greenhouse Gas emissions, we have to focus on the transportation sources. In other words, if we create cities that put housing far away from jobs, and create low-density patterns that don’t support transit very well; , then it’s no surprise that people have to drive cars a lot to get from one place to another.

S.B. 375 is the first major law in California that makes that connection between land use- , transportation, and climate change, and sets up a process to encourage the creation of communities which grow in a more sustainable way.

Streetsblog: A lot of the push for cleaner air has been about cleaner cars. This isn’t about that, it’s more about less cars than cleaner cars?

Woo: That’s right.

Senator Fran Pavley is the author of a law (AB 1493) that which reduces greenhouse gas emissions from passenger vehicles by about 22% by 2012 and by about 30% by 2016. These California clean car standards were held up for years by lawsuits from the auto industry, but the new federal standards announced by the Obama Administration should settle the matter.

SB 375 tackles a separate problem. Pavley’s landmark climate law AB 32 committed California to a the goal of rolling back greenhouse gas emissions to 1990 levels by the year 2020, but it didn’t really spell out how California is going to achieve that goal. SB 375 authored by Senator Steinberg is the next step in terms of addressing one of the major causes of Greenhouse Gas emissions related to transportation and land use.

Streetsblog: In a perfect world, how should Greater Los Angeles embrace SB 375. As a City, a county, a Metropolitan Planning Organization? What changes can we expect as a city and a county.

Woo: SB 375 sets a process whereby the 18 so-called “Metropolitan Planning Organizations” (MPOs) such as the San Francisco Bay Area, Central Valley and Southern California are responsible for adopting plans for reducing transportation-related greenhouse gas emissions generated within each region. The Southern California region is huge, the largest region in the state, with 48% of the state’s population. . The MPO in our region is called the Southern California Association of Governments (SCAG) and is a voluntary association representing local governments across the region, not just the City of L.A. and the County of L.A., but also Ventura, Orange, Riverside, San Bernardino, and Imperial Counties, and all the cities large and small within them.

Under SB 375, the California Air Resources Board will set a target for each for proportional reductions in the Greenhouse Gas Emissions relating to land use and transportation. In Southern California, since we have the largest and most complicated region, the sub-regions can adopt their own plan to reduce Greenhouse Gases as it applies to transportation.

To answer your question, a large city such as Los Angeles or a subregional association of cities in Western L.A. County or Western Riverside County may collaborate on what this law calls a “Sustainable Community Strategy” that will start to be serious about relating land-use decisions and transportation to the creation of Greenhouse Gases. Various local governments will start to focus on this.

Inside the cities, people will have to think about what role transportation and land-use make in their personal decisions.

Streetsblog: We’ve talked a lot about development, but what role does alternative transportation (transit, walking, biking) play in meeting the goals of 375?

Mike Woo as portrayed in City Beat.

Woo: The modes of transportation matter a lot. The availability of rail transit, bus lines, car sharing and even bicycles are very important to anyone making a transportation plan. If a plan is going to be developed at a local level, the people making this plan have to address how these alternatives help accommodate a reduction in Greenhouse Gas emissions.

The expectation is that the parts of the region that have the most alternatives to cars, that is have access to transit, ought to do more than areas that don’t have as many alternatives and aren’t going to have the opportunities to do it.

Yes, the availability of alternatives will have a lot to do with a local community’s ability to do their fare share in reducing their Greenhouse Gas emissions.

Streetsblog: What is your role, and what is Climate Plan’s role, in getting this moving in Southern California.

Woo: I wear many hats in connection to S.B. 375. I’m appointed to the Regional Targets Advisory Committee, RTAC, which is appointed by the Air Resources Board to make recommendations to the ARB by this September about how to develop targets for each of the regions for the state.

In addition to that, I’m an advocate in that I do work for Climate Plan. Climate Plan is pushing for the phrases “ambitious but achievable targets.” We want to push the envelope to set the targets as high as possible as a way of showing that land use and transportation changes can play a big part in reducing Greenhouse Gas emissions. Furthermore, by getting serious about reducing greenhouse gas emissions, we can also get more serious about planning for communities which rely less on driving cars and encourage diverse, lively, and sustainable mixed-use communities which aren’t wasteful about land, energy, and water.

The other hat I wear is as a member of the City Planning Commission. I can play a role in making a decision about specific development projects in L.A. in terms of what impact they have on transportation patterns, what kind of development patterns are created in the long-term and what are the climate implications.

Streetsblog: What kind of opposition are you facing in terms of people that don’t want to see this legislation implemented for whatever reasons?

Woo: When S.B. 375 was first addressed, it was much more of a mandatory bill, with a lot more teeth in it. There was strong opposition from the building industry, city governments and county governments that felt they were going to be required to do something but not be given the money to pay for it.

As the bill moved through the legislative process, it became less mandatory. You could say it’s a lot less mandatory bill and it is weaker than the original version of the bill. But it’s still quite an accomplishment that it got passed at all. And it can be a very constructive influence moving local government land use and transportation decisions in a more sustainable direction.

There is still some opposition to what were trying to do. Just last week I was at a meeting of the Southern California Association of Governments and there was opposition being articulated from two levels.

One source of opposition was local elected officials who questioned whether climate change was a real problem or questioned whether what they do has any impact on climate change. So there’s still a certain amount of foot dragging going on with local officials who don’t think it’s a problem or think it’s someone else’s problem.

Separate from that, right now I’d say there are a lot of people in local government who know of S.B. 375 but they are very unclear on how this affects what they’re doing right now. I know there’s a lot of conferences and outreach planned to help demystify this problem and explain clearly how this law will effect local government.

The next level is the general public, most of whom have never heard of S.B. 375. But if things start to change the general public will start to notice things happening differently then they would without this law. At some point this becomes a political issue: how do you make change if the goals aren’t very clear and if the effected representatives of the public aren’t very clear about what’s going on.


Woo speaks at the CALPIRG confernce on transportation reform earlier this month.

Streetsblog: If someone reading this interview likes what you’re saying and wants to help move the ball forward, what should they do?

Woo: They can contact us at ClimatePlan and beyond that if you belong to a local organization that has any interest in the environment or urban planning or transportation issues you can encourage those groups to get involved with the process.

In the end, the changes we’re talking about won’t happen without a groundswell of support which currently doesn’t exist. So, there is a role, a very critical and important role, for getting people involved with the process and building public awareness.

If there are elected officials, such as the ones I heard from last week, who don’t think it’s a problem or think it’s someone else’s problem, this is a place where the public can get involved and start influencing the local officials who are thinking about their place in relation to climate change.

Streetsblog: Anything else you want to add on Climate Change?

Woo: Ultimately, this does come down to some level of personal responsibility. This is not an abstract issue.

I sometimes mention when I give talks on the subject that if you stay up late and are watching cable television you can sometime see these public service announcements for the World Wildlife Fund with a sad polar bear sitting alone on a rapidly shrinking piece of ice.

The urban viewer is most likely wondering what that polar bear has to do with me. So this can be a hard point to get across, it might seem too theoretical; but clearly the decisions we make about urban sprawl and giving people few options except to drive a car ultimately have an effect on that polar bear.

In other words, there is some level of personal responsibility which is necessary in order to be serious about addressing this global problem.

Streetsblog: This is unrelated. On my way biking here as part of the “Bike Not to Work Day,” two people told me to ask you “Why Do the Streets of Hollywood Glitter?”

Woo: Back in the 1990’s when I was a Member of the L.A. City Council, someone suggested an experiment on Hollywood Boulevard using recycled glass mixed in with asphalt, aka “glassphalt” to use recycled material, to stretch the amount of money available for street repaving and creating this glitter effect on the streets of Hollywood. This is very appropriate given the reputation of Hollywood.

That was the reason there was some experimentation in paving Hollywood Boulevard with glassphalt. At the time there were a lot of people that made fun of it, thought it was a joke. But now I think it’s something a lot of people think should be done more because it encourages recycling and I just learned that it does relate to Global Warming.

Streetsblog: Everything relates to Global Warming

Woo: Typically black or dark colored streets retain heat much more than older streets in Los Angeles that are lighter colored or made of cement. I’m not a scientific expert on this, but if a the material in the street is reflecting light back , maybe that would retain heat less than using dark colored asphalt.

Maybe there is a carbon change benefit to using reflective material rather than dark colored material.

This is actually a good example of how some mundane decisions can be part of the solution.

Streetsblog: I’m hardly a scientific expert on anything, but I’ve heard the same thing: glassphalt is better for the environment than traditional road materials.

Woo: In the 90’s we talked about it only as a way to expand the demand for recycled materials. Nobody was talking about urban heat island effects on the city streets.

Streetsblog: So you were ahead of your time!

Woo: I guess so. I didn’t know everything about the underlying problem either, but at least there was an underlying idea about making a connection between a mundane project like street repaving and the state of the environment.

Streetsblog: The last question I ask everyone when I interview them is “if you could change one thing about transportation in Los Angeles, wave a magic wand and it would be changed, what would it be?”

Woo: I think I would borrow and idea from Bogota, Colombia. I would close the streets on Sunday, or one day a week, for two reasons. The first reason is to take over the street for recreational purposes on that particular day but also to show urban residents that there are dramatically different ways about thinking of urban space.

In Bogota, Mayor Penalosa started this idea and was initially ridiculed. Now, years later, this Sunday tradition is wildly popular. There are people on bikes, on roller skates or just walking down the middle of the street.

Every Sunday I go to the Hollywood Farmer’s Market to get fresh produce and I’m surrounded by people who just like walking in the middle of the street. Reclaiming the urban space.

To take this concept further, imagine Wilshire Boulevard completely closed to (automobile) traffic from the beach to Downtown L.A. and turning it into the world’s longest linear park. Things like that would be really exciting, wouldn’t cost much money and would really change the way people think about our streets.

SB 375, approved by the Legislature last year, addresses climate change through local planning. The law creates regional targets for reducing greenhouse gas emissions, and requires cities and counties to create transportation and land-use plans to meet those goals.

Sprawl stall | Editorials | PE.com | Southern California News | News for Inland Southern California

Sprawl stall

11:05 PM PDT on Sunday, May 17, 2009

Rapid development without much thought to the consequences is not a sustainable planning strategy. So if a new law aimed at curbing greenhouse gases also forces a change in longstanding planning habits, fine. Abandoning sprawl in favor of more sophisticated growth is long overdue for this region.

SB 375, approved by the Legislature last year, addresses climate change through local planning. The law creates regional targets for reducing greenhouse gas emissions, and requires cities and counties to create transportation and land-use plans to meet those goals. Southern California would need to reduce its annual emissions by about 2.5 million metric tons a year by 2020 -- the equivalent of taking 480,000 cars off the road.

And since about 38 percent of greenhouse gas emissions in Southern California come from cars and small trucks, development that reduces travel will be a key strategy in meeting the new law's goals. That could mean more residential building in already developed urban areas, projects clustered around public transit hubs and housing that allows people to get to work or stores without needing to drive.

Such planning approaches would be a significant change for a region built upon the availability of cheap, open land. But filling empty land with more homes has hardly been a model of success.

Largely unrestrained growth through the last three decades swamped public infrastructure and services, such as roads and schools, creating a constant struggle just to keep up with those needs. And expansion swallowed up huge tracts of open space, leading to numerous conflicts over environmental preservation and endangered species. That development approach also created long commutes to jobs elsewhere, leading to traffic congestion and heavy air pollution.

The Inland region has long since passed the point where development for growth's sake alone is an acceptable philosophy. The discussion instead needs to turn to what kind of growth the area needs to prosper, and how to sustain a decent quality of life amid new development. And now is the ideal time to start that work: The economic downturn has removed development pressures that have often pushed aside longer-term considerations.

Inland agencies have made some strides toward more thoughtful planning, such as Riverside County's integrated plan, which tries to balance growth, transportation and environmental needs. But such efforts are first steps in a long march to more coherent local development.

Just how SB 375 will work in practice remains unclear, and the state has yet to address many thorny practical issues. But the law will force a needed re-examination of planning attitudes and practices -- and that effort can only benefit the region's future.