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  • Indy Connect Economic Impact Analysis

    Final Report

    Indianapolis, IN

    October 5, 2016

  • Indy Connect Economic Impact Analysis

    Final Report

    October 5, 2016 | i

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  • Indy Connect Economic Impact Analysis Final Report

    ii | October 5, 2016

    Contents

    1 Executive Summary ............................................................................................................................ 1

    2 Introduction and Global Assumptions ................................................................................................. 2

    3 Literature Review ................................................................................................................................ 2

    3.1 Overview.................................................................................................................................... 3

    3.2 Transportation Benefits ............................................................................................................. 4

    3.2.1 Transportation Cost Savings ........................................................................................ 4 3.2.2 Impacts on the Environment ........................................................................................ 4 3.2.3 Energy Conservation .................................................................................................... 5 3.2.4 Travel Time, Cost and Convenience Benefits .............................................................. 5 3.2.5 Access Impacts ............................................................................................................ 6 3.2.6 Access to Education ..................................................................................................... 6 3.2.7 Welfare Recipients ....................................................................................................... 7

    3.3 Residential Property Value Impacts .......................................................................................... 7

    3.3.1 Land Use Policies and Property Values ....................................................................... 8 3.3.2 Agglomeration Impacts................................................................................................. 9

    3.4 Economic Impacts of Transit ..................................................................................................... 9

    3.4.1 Short-term impacts ....................................................................................................... 9 3.4.2 Long-term impacts ........................................................................................................ 9

    3.5 Bus Rapid Transit (BRT) ......................................................................................................... 10

    3.5.1 Transportation Benefits .............................................................................................. 10 3.5.2 Economic Development Impacts ................................................................................ 11 3.5.3 Business Attraction and Retention ............................................................................. 13

    4 Transportation Benefits ..................................................................................................................... 14

    4.1 Methodology ............................................................................................................................ 15

    4.1.1 Estimating Travel Time Savings Benefits................................................................... 16 4.1.2 Estimating Safety Benefits ......................................................................................... 17 4.1.3 Estimating Environmental Sustainability Benefits ...................................................... 18 4.1.4 Estimating Affordable Mobility Benefits ...................................................................... 19 4.1.5 Estimating Cross-Sector Benefits .............................................................................. 21 4.1.6 Estimating Benefit-Cost Ratio .................................................................................... 22

    4.2 Results..................................................................................................................................... 23

    5 Residential Property Value Impacts .................................................................................................. 23

    5.1 Methodology ............................................................................................................................ 23

    5.1.1 Station Area Impact Scenarios ................................................................................... 26 5.1.2 Data Analysis ............................................................................................................. 28

    5.2 Results..................................................................................................................................... 29

    6 Economic Impacts ............................................................................................................................. 31

    6.1 Methodology ............................................................................................................................ 32

    6.1.1 The IMPLAN System .................................................................................................. 32

    6.2 Results..................................................................................................................................... 35

    6.2.1 Short-term Impacts ..................................................................................................... 35 6.2.2 Long-term Impacts ..................................................................................................... 35 6.2.3 Impact on Gross Regional Product ............................................................................ 36

    7 Economic Development Impacts ....................................................................................................... 37

    7.1 Methodology ............................................................................................................................ 37

  • Indy Connect Economic Impact Analysis

    Final Report

    October 5, 2016 | iii

    7.1.1 Economic Development Interviews ............................................................................ 38 7.1.2 Data Analysis ............................................................................................................. 38 7.1.3 Economic Development Projections .......................................................................... 39

    7.2 Results..................................................................................................................................... 40

    8 References from the Literature Review ............................................................................................. 41

    9 Appendix A: OMB Guidelines on Benefit Transfer ............................................................................ 44

    10 Appendix B: Indy Connect Economic Impact Analysis - Red Line Phase I ...................................... 47

    10.1 Transportation Benefits ........................................................................................................... 47

    10.2 Benefit Cost Ratio ................................................................................................................... 47

    10.3 Residential Property Value Impacts ........................................................................................ 48

    10.4 Economic Impacts ................................................................................................................... 50

    10.5 Impact on Gross Regional Product ......................................................................................... 51

    10.6 Economic Development Impacts ............................................................................................. 52

    11 Appendix C: Indy Connect Economic Impact Analysis - Impacts on Affordable Housing................. 54

    11.1 Methodology ............................................................................................................................ 54

    11.2 Results..................................................................................................................................... 55

    11.2.1 Low Income Households ............................................................................................ 55 11.2.2 Transit Dependence ................................................................................................... 57 11.2.3 Rent-Burdened Households ....................................................................................... 59 11.2.4 Current Property Values and Costs ........................................................................... 63 11.2.5 Areas Susceptible to Increased Housing Affordability Issues .................................... 64

  • Indy Connect Economic Impact Analysis

    Final Report

    October 5, 2016 | 1

    1 Executive Summary

    The Indy Connect Central Indiana Transit Plan includes three bus rapid transit (BRT)

    routes and enhanced local bus service in Marion County. These enhancements will

    support economic growth while meeting the expected demand for frequent, reliable, and

    safe transit service in the region.

    This document describes the economic impacts of the Plan, which includes the Red Line