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THE NEED FOR LOCAL. FUNDING ASSISTANCE Despite the fact that many Bay Area communities have embraced the concept of "transit - oriented development" and have incorporated some language into their land use policies supporting dense development near transit, the reality is that there are significant financial barriers to actually implementing these policies. The challenges for TOD and infill include the need for infrastructure upgrades, high land costs, and complicated construction needs that all combine to exceed the revenues a project could earn. These issues are further exacerbated by swings in the real estate market that can vacillate between too strong and too weak without much in- between. In places where markets are strong, it is often easier to overcome these barriers, but in most places around the region, the market is often not quite capable of covering the increased costs associated with infill development and TOD. As a result, communities often feel compelled to accept projects which do not maximize the use of critical sites near transit and the San Leandro's opportunity for TOD and infill that maximizes the potential at these Downtown TOD Strategy: essential locations and nurtures the broader community can be Planning for the Future foreclosed by these types of decisions. At other times, communities The recently completed, MTC know they need to take more proactive steps to facilitate development, funded San Leandro's Downtown beyond planning, but lack the resources to take the next step. Thus TOD Strategy planning study an expanded source of funding that could help local communities identified over $140 million in needed fill some of the funding and implementation gaps associated with improvements for their downtown. infill development that meet regional objectives presents a major The plan identifies the opportunity for opportunity for the Bay Area to move closer to achieving its vision for as many as 3,400 new housing units at a sustainable region, while seizing key opportunities that only come up to 200 units per acre and represents around once in a generation. a tremendous breakthrough for the city in terms of supporting 'top Local governments are facing a very complex dilemma in their efforts through policy changes. However, to implement TOD. On the one hand cities are often required to take a it will remain only a plan until very proactive role in facilitating individual development projects that significant financing can be secured often include some type of revenue expenditure. Without these kinds for public improvements associated of investments, major opportunity sites languish or are redeveloped with the new development. Nearly with lower intensity uses that do not support transit ridership in $80 million is needed for a variety either their use or design. On the other hand, these same cities are of transportation improvements, facing increasing revenue constraints. Beyond the current market in addition to substantial financial crisis, which is also impacting property and sales tax revenues, most needs for housing and infrastructure California cities are facing significant structural deficits due to revenue projects. The city is working actively to attract both public and private funds limitations imposed by Proposition 13 and cost increases related to to begin development in downtown salaries and pensions. Given this situation, a regional funding source consistent with the TOD Strategy. dedicated to TOD implementation can have a rapid impact in helping cities move projects forward that also serve to advance regional goals for mobility, efficiency, and environmental quality. There are many potential uses for direct financing that span a large range of potential uses of funding. Local jurisdictions and developers, both for and not - for - profit, around the Bay Area and regional developers have outlined financial needs associated with: 12 FINANCING TRANSIT - ORI-NEED DE JELOF'MENT IN THE SAN FRANC ISC013AY AREA