Effects of Financing the Cost of Metropolitan Transportation Facility using TIF

Abstract

ABSTRACT Since the introduction of New Towns in Seoul MSA, land price has steadilly been risen due to the financial burden of constructing metropolitan transportation facilities. Despite metropolitan transportation facilities are utilized by New Towns as well as its surrounding area, the current situation is that most of the burdens, which is supposed to be shared with local governments, fall to developers. This study, with the case of Dongtan New Town, is to deduce rational structure of cost-sharing by the analysis of travel demands of metropolitan transportation facilities. Also, for the financing of the cost, the application methods of TIF(Tax Incremental Financing) have been suggested. The results showed that the proportion of travel which origins from New Town was 35.1%, which results in 800 billion won for the share of local government. For financing this amount of the cost, at least 20 years of financial period and the rate of 2% increase of real estate are needed in operating the TIF.Key words : TIF, Metropolitan Transportation Enhancement, Metropolitan Transportation Facility, Local TaxLHI Journal (2015) 6(4):185-193 http://dx.doi.org/10.5804/LHIJ.2015.6.4.185http://lhi.lh.or.kr