Value Capture Finance: An Innovative Urban Tool
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Positive feedback and negative feedback loop (Concept from book of LIMITS GROWTH) Feedback loop. Till any project which is targeted to cater 10,000 population reaches from its conceiving stage to its implementing stage the population is outgrown so there is high possibility of its failure. As the population in India is growing exponentially and not linearly. ANY PROJECT. Correlation with funding and population Positive feedback loop Resources planned to cater population funds are generated. Dedicated transport fund does not cater to the needs
Negative feedback loop Population in India growing at the rate of % so gap is observed in funding so assistance is needed.
Value Capture Method 1. Land value tax, Annual rates based on gain in land value -Uniformly Area-based 2. Fees for changing land use (agricultural to non-agricultural) 2. One-time at the time of giving permission for change of land use, Area/Project-based 3. Betterment levy One-time while applying for project development rights Area/Project based 4. Development charges (Impact fees) One-time, Area-based 5. Transfer of Development Rights Transaction-based Area/Project-based 6. Premium on relaxation of rules or additional FSI 7. One-time Area (Roads, railways)/Project(Metro) 8. Vacant land tax Recurring, Area-based 9. Tax increment financing Recurring and for a fixed period Area-based 10. Land Acquisition and Development One-time upfront before project initiation Area/Project-based 11. Land Pooling System One-time upfront before project initiation Area/Project based
Funds generated through value capture in context of Foreign cities Table 2: International Scenario
(aryan 2019) Table source: Article from Rail Analysis India Location.
London , Regional Rapid Rail
Hong Kong SAR, China, Rail Plus Property Program, Metro (Heavy rail, Light rail)
Development – Based LVC Practices New York City and Washington, DC
Financing a Metro with Development Rights of Public
Air Rights Sales São Paulo, Brazil
BHUMIKA RAJ UC5316
