BACKGROUND

Increasingly, transit agencies are exploring ways to leverage their Federal Transit Administration, or FTA-funded property to increase revenue. Occasionally, such property also may be used to support affordable housing.

The FTA supports such projects and, in August 2014, issued guidance on joint development (JD), including transit-oriented development (TOD), in Circular FTA C 7050.1A.

TCRP has addressed TOD and JD in past TCRP LRDs [TCRP Legal Research Digest 36: Transit Oriented Development and Joint Development Case Studies and Legal Issues (2010)], which updated TCRP Legal Research Digest 12: The Zoning and Real Estate Implications of Transit-Oriented Development. These past digests have focused on legal and other planning tools available to transit agencies and municipalities to encourage TOD and joint development projects.

For example, the Washington Metropolitan Area Transit Authority (WMATA) has adopted joint development policies and guidelines, and has completed at least 18 JD projects since 2006. The Los Angeles County Metropolitan Transportation Authority (LA Metro) also has adopted JD policies, and since 1995 has completed at least 14 JD projects and has at least 16 projects in the pipeline. The San Francisco Bay Area Rapid Transit District (BART) recently updated its TOD policy and performance targets and aims to build 20,000 housing units (35% affordable) and 4.5 million square feet of commercial space by 2040. With this growth, requests for JD agreement examples, templates, or provisions have increased.

OBJECTIVE

The objective of this research is to produce a digest that addresses both FTA requirements for JD projects with FTA assistance or FTA-funded assets, and develops model provisions to include in JD agreements. As background, the report should discuss the essential requirements of the Circular referenced above—including definitions of JD and TOD, eligibility for a JD project, and the JD process—in order to help FTA grantees navigate the process. For example, what role does the FTA play in the process, and to what timelines should grantees adhere to receive any necessary FTA guidance or approvals? If there are other federal and state agencies providing funding, what role should they play (e.g., in the environmental process), and to what extent will the FTA accept their decisions?

In determining appropriate provisions to be contained in a JD agreement, the author should consider the structure of the agreement (e.g., lease or sale), model provisions to ensure satisfactorily continuing to control and protect the federal interest, and assignment of risk. The author should identify and interview agencies that have undertaken JD projects to determine issues that have arisen in the solicitation of proposals and the negotiation of the agreement. In addition, the author should discuss lessons learned, including issues that became apparent post development that were not adequately addressed in the agreement (e.g., bankruptcy, enforcement, contamination, liens, foreclosures, insurance, maintenance, management). The report should include sample agreements, with special emphasis on transit-specific provisions that transit agencies have successfully negotiated to protect adjacent or future transit uses.

Status: Completed. Published as LRD 56.