Lavishing Developers With Publicly Funded Infrastructure in the D.C. Burbs

We wrote last week about how critics of transit projects often demand that urban developers contribute to the funding of new infrastructure, while interchange-profiteers like Wal-Mart and Olive Garden are rarely asked to pay a cent.

A bird's-eye view of the "Town Center" planned by Konterra Development in Prince George's County. Taxpayers will fork over $74 million to the project in the form of road infrastructure. Photo: Konterra

Today, Richard Layman at Network blog Rebuilding Place in the Urban Space brings us the story of a suburban development project that will benefit from a massive public subsidy in the form of road infrastructure.

In Prince George’s County, Maryland, Konterra Development is building a “Town Center” with 5.8 million feet of commercial space about a 20-minute highway drive from D.C. Meanwhile, the state needs some of the land owned by Konterra to construct the Inter-County Connector highway project. So the ever business-minded developer has waged a legal battle to force the state to pay as much as possible for land and infrastructure that will make the “Town Center” project financially viable. The state of Maryland will spend $74 million in public funds for a new interchange and intersection improvements to serve the development.

Layman says that while the developer may be charged an impact fee, it will likely be grossly insufficient to offset the public costs that will enable Konterra to capture big profits:

The owners pay little. Hell, they should have given the land to the State for the interchange, since it makes their development viable instead of just a bunch of land.

They should have had to pay tons of money towards the intersection, which converts the development potential of “4,500 residential units, 5.3 million square feet of commercial, retail and office space, and 500,000 square feet of hospitality space” to development actuality.

Considering that far more money will be invested in road infrastructure to support Konterra’s not quite 500 acres of land than this $74 million down payment by the State of Maryland (not to mention some portion of the $2.256 billion spent on the Inter County Connector), it seems as if the developers are getting off easy.

This is, in a way, a public-private partnership of the worst kind — one where the public makes the investment and the private “partner” recoups all the profits. While state governments across the country are slashing education and social services, somehow public coffers always seem to be full when it comes to projects like this.

Elsewhere on the Network today: Which city has the largest share of foot and bike commuters — New York, Boston or Newark, Delaware? Bike Denton has the answer. The Transportationist looks at a news report that asks the question: “Is sprawl over?” And Cap’n Transit talks freight efficiency (it’s the mode, stupid).