Innovative Infrastructure Delivery: Capital Investment Coordination
Issue: Uncoordinated State Capital Investments
The State of Illinois will always have limited resources for capital investment, so it is important that funding decisions yield maximum benefits for residents and businesses. The reality today is that state capital investments in transportation, housing, business development and natural resources management are frequently uncoordinated and do not align with priorities established by the state or metropolitan regions, such as those set forth in Chicago Metropolitan Agency for Planning’s GO TO 2040 plan for northeastern Illinois. What’s more, performance goals are only rarely established before state investments are made, and performance is not consistently measured or monitored, making it impossible to determine which investments yielded the greatest returns. This lack of coordination means, for instance, that the state invests in housing that is far from transit and jobs, in roads that do not manage stormwater well, and in new businesses that do not account for and appropriately manage their water supply.
Solution: Establish an Office of Capital Investment Coordination
An Office of Capital Investment Coordination, with cabinet level leadership, would integrate the resources of a number of state agencies and focus investment impact in key regions of the state. The Office of Capital Investment Coordination would liaise with the state’s Metropolitan Planning Organizations, regional water supply planning groups, housing authorities and other regional actors to assess opportunities for coordinated state investment in regional priorities. At a minimum, the Office of Capital Investment Coordination would work in concert with the Illinois Dept. of Transportation, Illinois Housing Development Authority, Illinois Dept. of Natural Resources, Illinois Dept. of Commerce and Economic Opportunity, Illinois Environmental Protection Agency and Illinois Dept. of Agriculture to coordinate decisions on grant and loan activities, establish specific investment goals, build protocols for monitoring investment outcomes and identify possible policy conflicts between agencies.
Benefits
Because well-planned transportation investments increase people’s access to desirable destinations, locations near these investments command higher land prices, benefiting land owners and developers. Value capture mechanisms, like tax increment financing (TIF), are a type of public financing where increases in the private land values generated by public transportation investments are “captured” to repay the cost of the public investment. Using value capture mechanisms to finance new or existing transportation infrastructure connects the benefit of the infrastructure investment with the cost to provide it.
