Railbanking agreements

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Railbanking agreements are policies by which government agencies and rail operators agree to repurpose underutilized or abandoned local rail lines, typically for the purpose of establishing space for a park, public trail or other recreational activities. In some cases, railbanking agreements may also involve a private non-profit advocacy or parks group, which may share responsibility with the municipality for funding, capital construction and operation of the line once converted. Railbanking agreements are legally binding documents that address such topics as (i) the process and timing by which the rail operator will cease use and control of the rail line; (ii) rail operator and municipality respective responsibilities for (a) structural integrity of rail line and (b) environmental clean-up of rail line for any pre-turnover hazards; and (iii) the license from the rail operator to municipality for possession and use of rail line.

In the U.S., in order to protect the public interest in effective rail service, many passenger and freight rail operators may not permanently abandon rail service without permission from the federal Surface Transportation Board (STB). The STB may approve abandonment on an interim basis, during which the municipality may implement alternative uses, such as recreational activities. However, if it is later determined that the line should be returned to rail use, the interim use would be reversed and rail use would be resumed. Railbanking agreements thus sometimes arise after a rail operator identifies a line as surplus, unprofitable and/or no longer material to the operator's overall rail system, triggering the rail operator's seeking permission from the federal government to abandon and demolish the line, which itself may trigger local efforts to repurpose the line instead. The railbanking process may also be initiated by a municipality, which may argue that the line is a public safety hazard or eyesore and request that the line be taken out of service, if still active.

CONCEPT


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Goals
Conceptual Example

In an urban area with declining rail freight use, the rail operator functionally abandons activities on the rail line. Maintenance of the line declines, causing an eyesore and public safety hazard. Neighborhoods near the line are adversely affected, which discourages new investment. The municipality and parks advocacy groups want to create more urban parkland, and the under-utilized rail corridor presents an opportunity with low land acquisition cost. The rail operator, municipality and parks groups propose to the Surface Transportation Board of the federal Department of Transportation that the rail line be converted to interim trail use which permits park use on a "temporary" basis (even if it is indefinite as a practical matter). This approach relieves the rail operator of the economic burden of maintaining an unproductive asset (which also creates safety and environmental liabilities), preserves the possibility of restored rail use if the rail transportation system so requires at a future date, and enables creation of a linear park. The latter facilitates new capital investment in the park facility, usually encourages neighborhood improvement and often spurs extensive new investments along the rail corridor in housing and other real estate developments.

Specific Example

The Bloomingdale Trail was a roughly 2.7-mile long stretch of functionally abandoned rail line in Chicago, located between The Loop and the city's western suburbs. The City of Chicago joined with a non-profit conservation group called Trust for Public Land around 2009 to advocate conversion of the rail corridor into a linear park. In accordance with federal law, conversion required agreement of both the Surface Transportation Board of the federal Department of Transportation (STB) and the rail operator. Project managers at Trust for Public Land studied rail conversions in other cities, including The High Line in New York, to assess specific challenges that had arisen in similar projects. One key lesson that emerged was the importance of understanding the needs and preferences of neighborhoods adjacent to the rail line. In the case of Bloomingdale Trail, the corridor passes through Humboldt Park, Wicker Park and Logan Square. These are lower-middle and middle-class areas, parts of which had begun to experience some gentrification prior to creation of the linear park. In planning the park, which came to be known as The 606, the project managers spent extensive time meeting with neighborhood and community groups in order to develop programming that responds to local needs. Since its opening in June 2015, The 606 has been used by the elderly for relaxation and low-impact recreation, young mothers out with children in strollers, joggers and bikers. While it has some use as a commuter facility, that is relatively minor, given its location and limited links to other components of Chicago's transit system. The 606 has spurred considerable investment in the adjacent neighborhoods, and developers often market new apartments based on their proximity to The 606. In total, the 606 project itself has an initial budget of $95 million [1]. In contrast, The High Line cost over $187 million. [2]

Tradeoffs

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Tradeoffs of implementing this policy may include:

  1. Potential displacement of existing neighborhood residents due to gentrification. While such park projects often spur neighborhood development and investment and are beneficial in many respects to municipal growth and the property tax base, the new uses will over time most likely increase area rents and living costs, thereby pressuring prior neighborhood residents and making their community less affordable.
  2. Necessity for re-zonings. Rail corridors sometimes run through industrial areas. In some cases, municipal zoning may limit buildings to industrial uses, and prohibit residential and retail development. Such industrial areas typically generate low property tax assessments, and may be adjacent to lower-income communities. In connection with park conversion, municipalities often decide to change zoning adjacent to rail corridors as a means of spurring new investment. Such up-zoning contributes to the problems of gentrification, affordability and displacement of pre-existing neighborhood residents.
  3. Public safety concerns. Public safety may be enhanced by promoting use of parks by a broad range of people. However, these users often include neighbors as well as "outsiders" such as tourists and persons from other parts of the urban area. While attracting such outsiders may enhance the reputation of the park and the municipality, public safety benefits are more likely to be realized if nearby neighborhoods are actively engaged in using the park. Issues of public safety and equity are also affected by programming of park activities. For example, art exhibitions may be of particular interest to tourists, while active recreation and dog walking may be of greater appeal to neighborhood residents. Once again, these choices affect the degree to which pre-existing local residents will support the project over time, as distinct from outsiders and new residents.
  4. Risk of rail line being reclaimed. As a legal matter, railbanking agreements with the STB include the possibility that the abandoned rail line can be returned to active rail use if circumstances warrant. However, given the extensive economic investments and recreational uses spurred by conversion projects, it seems unlikely that returns to rail use will occur in most cases. Indeed, only a very few re-conversions have actually occurred.
Compatibility Assessment

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If answered yes, the following questions indicate superior conditions under which the policy is more likely to be appropriate:

  1. If an under-utilized rail corridor is removed from rail line use, can such conversion be designed in order to avoid adverse effects on the freight and/or passenger transit system?
  2. Do other public or private rail and other transit resources exist such that pre-existing users of the under-utilized rail corridor can be re-directed to acceptable alternative modes and locations?
  3. Do under-utilized rail corridors exist in locations that may be suitable for new, alternative types of development?
  4. Is it likely that the required public investment will generate new private investment and neighborhood improvement at a level that justifies the proposed use of public capital?
  5. Will public capital investment in the new park be adequate even if limited to a level that will not cause disinvestment in existing park facilities?
  6. Will the new park be located in a neighborhood that currently has insufficient access to public park and recreational facilities?
  7. Will any public controversy generated by the conversion project likely be at a politically manageable level and avoid excessive divisiveness?
Design

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Assuming that a jurisdiction has decided to adopt the policy, the following questions will need to be answered when determining how to implement this policy:

  1. What recreational needs should be served by the proposed park?
    1. Recent projects such as The 606 and The High Line have sought a balance among active and passive uses, including for example art installations and workshops, jogging lanes, walking paths, planting areas and (in the case of The 606) bike lanes.
    2. Given the linear configuration of most rail conversions, active uses must be compact--e.g., basketball rather than baseball. Similarly, pedestrian and bicycle uses are popular uses; however, conflicts may be created between the two if conditions are overcrowded.
    3. Some parks also emphasize public health and wellness in its facilities. For example, exercise equipment and/or areas for group exercise classes may be included. Decisions on these matters may be informed by an assessment of existing recreational facilities in the vicinity and surveys of local residents regarding their priorities.
  2. Which specific communities will the new park serve?
    1. Parks, and portions thereof, may target existing neighborhood residents, visitors from other parts of the jurisdiction, or tourists.
    2. If there are nearby schools, it may be desirable to serve the recreational and educational needs of students; e.g., ball fields and other athletic facilities, or study areas.
  3. What balance should be struck between public and private investment in the project?
    1. Planners should make a realistic assessment of the potential for substantial charitable donations and/or corporate contributions, both for initial capital costs as well as on-going maintenance and operating expenses.
    2. Where appropriate, planners may also consider revenue generating-components, such as food concessions or equipment rentals, that may defray operating expenses over time, as well as the likely amount of neighborhood development that may be fostered, thereby increasing the local property tax base.
  4. Should the project incorporate new zoning to alter the scale and type of private investments adjacent to the park?
    1. Assuming that the railbanking agreement leads to an attractive new neighborhood amenity, it will likely lead to increased property values and, potentially, increased demand for adjacent residential, commercial and retail uses. Given a history of rail lines being situated in industrial areas, it is likely that the areas that will be subject to the railbanking agreement may be strong candidates for rezoning to respond to market demands, which may also raise concerns with respect to gentrification.
  5. How will any concerns about public safety be addressed?
    1. Sample security measures may include lighting, fencing and other separation components.
  6. How will park design affect operating expenses?
    1. For example, if plantings rely primarily on native species, it may reduce the need for additional water and fertilizer. Similarly, the park design may incorporate green infrastructure principles as a means of fostering more efficient management of storm water and sewage systems.
  7. What steps, if any, should be taken with respect to protecting housing affordability in affected neighborhoods?
    1. If planners expect the project to lead to higher neighborhood housing prices over time, they may wish to explore concurrent housing policies to protect existing tenants from displacement.

ADOPTION


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PolicyGraphics
  • Has adoption of: Common. [3]
  • For governance level(s): Local, National. Railbanking is most commonly pursued by municipal governments in a wide variety of urban, suburban and rural contexts.
  • For area type(s): Urban, Suburban, Rural.
  • For issue type(s):
    • Equity. Development of new parks in under-served areas brings opportunities for recreation and enhanced health and wellness to citizens who do not have accessible alternatives. New park development may cause adverse impacts by spurring new neighborhood development which leads to higher housing prices and may cause some neighborhood residents to be pushed out. [4]
    • Finance. Public investment in capital costs of developing new parks is always a financially significant decision. In the context of railbanking, many new parks have attracted private charitable and corporate contributions which supplement public funds. If new linear parks lead to neighborhood development, that will increase the local property tax base. [5]
    • Infrastructure. Rail line abandonment of course reduces transit resources. However, it usually only occurs in circumstances in which market forces and changing transportation technology has made rendered specific rail lines obsolete. In addition, new park development often includes green infrastructure which enhances efficiency of storm-water, sewage, water supply and drainage systems.
    • Safety. New linear parks have been shown in some cases to lead to a reduction in crime in adjacent communities. Rates of violent, property and disorderly crime all fell at a faster rate in neighborhoods along the 606 [a new park in Chicago] than in similar neighborhoods nearby, and the decrease was largest in lower-income neighborhoods adjacent to the trail. A well-designed greenway can increase residential and commercial activity, bringing in more foot traffic that pushes out crime in the neighborhood. [6].
Adopters

STAKEHOLDERS


Supporters

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Opponents

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  • Advocates - Affordable Housing. Assumption: Railbanking agreement will result in less affordable housing for local residents near the rail line.
  • Advocates - Fiscal Conservatives. Assumption: Railbanking agreement will result in significant upfront capital and ongoing operating expenditures for a large government project, requiring an increase in public revenues or a decrease in public expenditures in other areas.
  • Constituent Groups - Renters. Assumption: Railbanking agreement will result in increased property values and rental rates, resulting in residents being displaced.


REFERENCES


Research

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Resources

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Footnotes
  1. The 606 Website. The 606: Frequently Asked Questions. Accessed on May 29, 2017.
  2. New York City Economic Development Corporation Website. Projects: The High Line. Accessed on May 29, 2017.
  3. Rybczynski, Witold. "Bringing the High Line Back to Earth". The New York Times, May 15, 2011.
  4. O'Neill, Natalie. “High Line creator admits the park is a problem for residents” New York Post, February 13, 2017.
  5. Cuozzo, Steve. “Calling The High Line ‘a failure’ is an insult that reeks of liberal guilt”. New York Post, February 18, 2017.
  6. Hays, Brooks. “Study shows parks, greenways may help reduce crime in Chicago”, February 27, 2017
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