SOUTH PORTLAND — The Legislature this week was expected to take up a bill that would give municipalities an additional tool to pay for expanding public transportation operations.

The bill would allow cities and towns to use tax increment financing, an economic development tool, to capture new tax dollars generated by developments along transit arterials and hubs. The bill would also allow municipalities to offer tax incentives for mixed-use developments that increase residential density along public transportation corridors. 

The bill has several sponsors, including Sen. Larry Bliss and Rep. Jane Elberle, both South Portland Democrats. However, the driving force behind the effort is South Portland Planning and Development Director Tex Haeuser, who said he is very hopeful the bill will be passed by the Legislature.

“The times are changing, as prices are rising and climate change is looming,” Haeuser said. “We need to adjust the way we live to a cleaner, smaller carbon footprint.”

Although the bill would reduce state revenues by allowing municipalities to shelter new land value, it was supported by the Taxation Committee by a 10-3 vote. Bliss said he expected the bill to be approved this week.

There are many potential benefits of creating a so-called Transit Oriented Development TIF, Haeuser said, not the least of which are environmental. The proposal would also provide a much-needed boost to local coffers – from municipal to family budgets.

“We could even save money in family budgets because they wouldn’t need as many cars,” he said.

The bill would allow municipalities to capture the new value of developments within 500 feet of a designated transportation corridor. New value could also be captured within a quarter mile of a transit hub. Transit TIFs would have a 30-year life with an option to renew. 

Portland City Councilor Kevin Donoghue said the bill fuels potential for light rail trolleys along Forest Avenue, improvements to Franklin Arterial and, perhaps, a light rail trolley along Commercial Street connecting the East End to the Amtrak Downeaster/Concord Coach station on Sewell Street.  

Haeuser said the bill also seems to have support in rural communities, because studies have shown that communities with public transit experience a 3-1 cost-benefit ratio, netting an additional 11 percent in total revenue compared with those without transit. It’s also estimated that about 30 jobs are created with every $1 million invested in public transportation and an additional 57 jobs are supported with every $1 million invested in transit operations.

In addition to transit operations and development incentives, Haeuser said bike lanes and pedestrian-related improvements like sidewalks and crossing signals could be funded. 

Maggie Drummond, policy director for Yarmouth-based GrowSmart Maine, said her group supports the bill because of its projected economic benefits as well as the way it encourages smart growth. Not only would public bus services benefit from the bill, but smaller communities could use the funds to start smaller van-pool services to shuttle workers to employment centers.

“New transit services can generate new vitality in downtown areas and along main streets,” Drummond said. “And (they) also have well-documented effects on income growth, since they give people more productive, affordable way to get to work.”

In South Portland, Haeuser said the bill could help fund a rapid transit bus route between the city and Gorham. The same could happen along Brighton Avenue in Portland to Westbrook. Haeuser also said he envisions a time when fixed-rail trolleys could make a comeback. 

In addition to providing financial assistance to municipal transit operations, the bill also seeks to encourage landowners to build mixed-use developments, which incorporate businesses and high-density housing into single developments. 

Haeuser said the intent is to create a self-sustaining fund for transportation, since developments along a transit corridor would not have to devote as much of their land to off-street parking. That higher density, Haeuser said, would in turn produce more money for the municipality to expand and support more transit options, which would become more attractive to developers. 

Haeuser said the original proposal included minimum density requirements for new developments to be included in a TIF district, but the state Department of Economic and Community Development, which oversees TIF programs throughout the state, did not have the regulatory authority to enforce it. 

“We’ll try to work on that through education,” he said.

Randy Billings can be reached at 781-3661 ext. 100 or rbillings@theforecaster.net