Light rail can help to deliver more affordable housing for Hobart

Published in The Mercury, January 2018

At the recent announcement of a City Deal for Hobart, Prime Minister Turnbull enthused about the potential for ‘Transit Oriented Development’ along our rail corridor. What does this term mean, where has it worked well, and how could it benefit Hobart?

The term ‘Transit Oriented Development’ may be new to Tasmanians, but elsewhere in the world it’s a rapidly growing trend towards creating compact, medium density, pedestrian-oriented communities centred around high quality public transport systems (mainly light rail).

The US city of Portland, Oregon, has an international reputation for integrating public transport with economic development and land use. Its emphasis on using light rail to attract development has become a model for planning in cities across the USA and the world.

In September 2017, I visited the city with an agency based at Portland State University that organises study tours for national and international delegations to learn about Portland’s innovative policies.

Light rail has become a permanent and deeply ingrained part of Portland’s civic life. 100 kilometres of track, 5 lines and 97 stations are critical to how the city of 600,000 people live, work, shop and play. Good transit and Portland’s ‘liveability’ is now leading to population and economic growth.

Portland’s transport agency, TriMet, estimates that $13.6 billion worth of commercial development has occurred around their light rail stations. As well as easing traffic congestion and reducing pollution, their public transport system creates thousands of jobs while delivering customers to businesses, employees to work, and students to education.

Metro is the regional planning body for the greater Portland area. It was established in 1973 with state-wide planning legislation and an urban growth boundary set for the city.

Since 2001, Metro has run a Transit Oriented Development program to incentivise mixed-use and residential development around bus and rail public transport corridors. Its aim is to increase the number of passengers (ridership) as well as higher density development near public transport.

Their annual budget for this Transit Oriented Development program is currently $3 million, funded by the federal government. Metro uses these funds to leverage development by helping to offset costs in strategic locations. Increasingly these limited funds are focused on tying financing to the inclusion of affordable housing units in new private sector residential developments.

The results from the strategic use of this relatively small budget are impressive. Since 2000, just $12 million of incentives has leveraged 37 housing and mixed-use projects worth more than $600 million. These projects have delivered 3,353 residential units near public transport, of which 729 are set aside for households earning less than 60% of the area’s median income.

While in Portland, I travelled the MAX Yellow Line. The area it runs through reminds me very much of Hobart’s northern suburbs rail corridor.

The Yellow Line opened in 2004 and runs between Portland State University in the city and the suburbs to the north, with 10 stops along the way. Development of the line was driven by a goal to bolster economic development and housing opportunities in a part of Portland with a lower socio-economic profile than other areas.

The City of Portland created an urban renewal district along the proposed line, which made the project eligible for federal grants that funded 70 percent of the $350 million project. Since opening, the line has been a catalyst for more than 50 new businesses and increased medium density housing. TriMet’s real estate arm invested in development of affordably priced apartments along the corridor, and reinvested the funds earned back into public facilities.

The long term economic and housing development benefits gained from developing the Yellow Line came from a willingness by government to invest public funds in the transport service. This required a leap of faith, recognition that this was a strategic intervention and acceptance that the service would not turn a profit initially. When the service opened the fares only covered 42% of the operational costs. Ten years on the area is more vibrant, the train is used more and the fares now cover more than 60% of the operating costs.

It’s exciting that the development of light rail for Hobart will now be advanced as part of the City Deal. Hobart and Glenorchy Councils already have a Working Group to investigate our role in promoting the urban renewal opportunities of developing the rail corridor.

To unlock the benefits of additional affordable housing development, it’s imperative that state and federal governments work with the Hobart and Glenorchy Councils to establish a rail corridor project development agency.

This agency should be empowered to draw on lessons learned from cities like Portland, that use light rail developments to deliver much needed affordable housing, in addition to new transport services.

Like Portland, Hobart is well placed to become a leader in Transit Oriented Development. I urge the citizens of greater Hobart and all levels of government to join the Councils in this transformative vision.