Amtrak Station Area Planning and Land Use Analysis

Virginia Department of Rail & Public Transportation Amtrak Station Area Planning and Land Use Analysis CARMEL CHURCH STATION CAROLINE COUNTY August 2008

Table of Contents 0.0 EXECUTIVE SUMMARY...1 0.1 Background...1 0.2 Land Use Plan...1 0.3 Market and Economic Impacts...2 0.4 Implementation: Funding and Financing...3 0.5 Implementation: Infrastructure and Environment...3 1.0 PROJECT OVERVIEW...5 2.0 DESCRIPTION OF STATION AND STATION AREA...7 2.1 Station function proposed service and relationship to other stations...7 2.2 General overview of the study area at station location...7 2.3 Overarching themes for station area plan...7 3.0 LAND USE...9 3.1 Background / Existing Character...9 3.2 Planning Context...9 3.3 Site Potential and Proposed Land Use...10 3.4 Site Constraints...13 4.0 MARKET CONDITIONS...18 4.1 Office...18 4.2 Retail...20 4.3 Residential...22 4.4 Summary...24 5.0 Economic Impact...25 5.1 Earnings, employment and output effects from capital expenditures...25 5.2 Capital expenditures...25 5.3 Construction impacts...26 6.0 Potential Local Funding Mechanism...28 6.1 Tax Increment Financing...28 6.2 General Assessment of the TIF Mechanism in Virginia...30 7.0 SUPPORTING TRANSPORTATION ANALYSIS...32 7.1 Roadway Network...32 7.2 Traffic Impacts Under Build Condition...33 7.3 Transit Network...36 7.4 Pedestrian Accessibility...36 7.5 Bicycle Accessibility...36 7.6 Summary of Recommended Infrastructure Improvements...37 Technical Memorandum: Carmel Church Station i

8.0 SUPPORTING ENVIRONMENTAL CONSIDERATIONS...38 8.1 Forested Areas...38 8.2 Water Resources...38 8.3 Historic Sites...40 8.4 Hazardous Materials...40 8.5 Protected Species...41 List of Tables Table 4-1: Office Construction Value and Tax Revenue Caroline County...19 Table 4-2: Office Construction Value and Tax Revenue Carmel Church Station Area...20 Table 4-3: Retail Construction Value and Tax Revenues Caroline County...21 Table 4-4: Retail Construction Value and Tax Revenues Carmel Church Station Area...22 Table 4-5: Housing Demand, Construction Value and Tax Revenue Caroline County...23 Table 4-6: Housing Demand, Construction Value and Tax Revenue Carmel Church Station Area...24 Table 5-1: Projected Construction Impacts by Property Type at Carmel Church Station...27 Table 6-1: Carmel Church Station TIF Summary...29 Table 6-2: Incremental Property Tax Revenues for Carmel Church Station...30 Table 7-1: Derivation of Traffic Growth Factors...32 Table 7-2: Ridership Projections for Caroline County Station...33 Table 7-3: Estimated Intersection Level of Service...35 Table 7-4: Estimated Costs of Infrastructure Improvements...37 Table 8-1: Caroline County Protected Species...41 List of Figures Figure 1-1: Project Station Locations...6 Figure 2-1: Carmel Church Station Area...8 Figure 3-1: Carmel Church Station Proposed Land Use-Concept Plan...14 Figure 3-2: Carmel Church Station Illustrative Plan...15 Figure 3-3: Example Photographs...16 Figure 3-4: Thoroughfare and Alley Sketches...17 Figure 7-1: Concept for Growth in Traffic Volumes...33 Figure 7-2: Proposed Street Infrastructure Improvements...34 Technical Memorandum: Carmel Church Station ii

0.0 EXECUTIVE SUMMARY 0.1 Background Caroline is a small rural county with a progressive approach to planned growth. The county is located strategically along I-95 between Fredericksburg and Richmond, yet it has experienced little of the sprawling development that dominates the I-95 corridor in neighboring counties. According to the 2004 Comprehensive Plan, Caroline recognizes that growth is inevitable, but will only accept development that benefits, rather than burdens, future generations. Carmel Church, one of several subareas within the county, has absorbed about half of the county s growth since 2000. It was first identified as a primary growth center in the county s 1977 Comprehensive Plan and has retained this designation through subsequent comprehensive planning efforts. Currently, Carmel Church is the location for a county-led transit oriented development (TOD) planning initiative. The proposed TOD location is 27 miles south of Fredericksburg Station and 11 miles north of the Ashland Station on the existing CSX rail line. 0.2 Land Use Plan The proposed land use concept for the station area builds on the general land use approach established in the TOD Study Bubble Plan prepared by Caroline County. While it follows the general concept of the Bubble Plan to the west of the CSX railroad, it expands upon and modifies some aspects of the Bubble Plan. In the vicinity of the station on both sides of the railroad, the proposed concept recommends higher mixed-use densities in the long term, in order to maximize the potential of the transit station. It also diverges from the Bubble Plan in the addition of recreation uses and a potential school site to the east of the rail line, the removal of roundabouts from mixed-use areas on the west side of the railroad to improve pedestrian circulation, and the addition of new roundabouts in the northern portion of the study area. Key elements of the proposed plan include: Creation of two medium-scale, retail mixed-use neighborhood centers on the site, surrounding by medium to low scale residential development. Long-term high density development adjacent to I-95. Creation of a River Walk as a central feature of the TOD. Inclusion of a potential school site and several large recreation facilities. Big box retail at the northern end of the site. Minimum 100 buffers between Route 1 and the TOD, in order to maintain the road s rural character. Similar buffers between the TOD and Rogers Clark Boulevard and I- 95. Preservation of the environmentally sensitive and historically significant land at the southern end of the site. Constraints to development include significant environmental constraints in the form of wetlands and Chesapeake Bay Resource Protection Areas. Other development challenges include protection of an important Civil War battlefield site on southern portion of the site and Technical Memorandum: Carmel Church Station 1

the need to maintain the rural character of Route 1 as it passes through the study area. In addition, development on both sides of the railroad will require significant investment in bridge construction to enable access to the eastern portion of the study area. To implement this land use plan the County will need to change its zoning (the maximum density currently allowed is 10 to 15 dwelling units per acre). County staff have expressed an interest in developing a Transit-Oriented Development zone that incorporates form-based codes. These zoning changes, like the proposed land use plans, will require public review. The County has committed funds for the next round of studies needed for plan implementation and has applied for additional funding. 0.3 Market and Economic Impacts The proposed land use plan would have the following estimated market impacts: The site plan for the Carmel Church Station indicates build-out of 636,500 square feet of office space, which is about double the total projected for Caroline County. While this could be viewed as somewhat aggressive, it may be supported by attracting commercial tenants that rely on travel to the Washington DC and/or Richmond areas, which would be easily accommodated by the enhanced Amtrak service. The site plan for the Carmel Church Station indicates build-out of 636,500 square feet of retail space, which is about 130 percent of the total projected for Caroline County. According to the County Business Patterns for 2005, there were 67 establishments in Caroline County engaged in retail trade, 39 of which had 1 to 4 employees. This implies that 58 percent of retail consists of extremely small operations. This causes County shoppers to travel to Fredericksburg and Richmond for a variety of shopping needs. The retail build-out associated with the Carmel Church site plan may reflect the reality of bringing more and varied shopping opportunities to a vastly underserved market. The site plan for the Carmel Church Station area indicates build-out of 2,935 residential units totaling 3,249,500 square feet which is about 67 percent of the total projected for Caroline County. This appears to be a reasonable share for an area that is a designated growth area emphasizing TOD that will greatly exceed current densities in the County. For all classes of development, construction value is estimated to generate about $78 million in property taxes from 2013 through 2030 at the Carmel Church Station Area. This is about 70 percent of the property taxes projected for Caroline County from new development over the same time period. An economic impact analysis was conducted as part of the station planning exercise to project potential effects of construction expenditures at the sites around the proposed Carmel Church Station on the regional economy in terms of increased employment and related economic effects. The analysis concluded that station area construction on the scale proposed in the land use plan would create an average of over 500 jobs per year during the 18-year assumed period of construction between 2013 and 2030. Technical Memorandum: Carmel Church Station 2

0.4 Implementation: Funding and Financing A critical step in the implementation of any new station or station improvements is funding the local share of station construction costs. Planners are evaluating two major mechanisms that are being used in several U.S. cities to finance localized transportation improvements Tax Increment Financing (TIF) and Transportation Improvement Districts (TID). Tax increment financing (TIF) is widely used in Virginia and across the United States as a method for financing current investments (including public infrastructure such as rail stations) by capturing and dedicating expected future gains in property tax revenues in the area around the investment and using those gains to pay back the investment s initial cost. Tax assessment districts are also widely used in the United States as a way to ensure that businesses and residents who will benefit from a public investment also share in its costs. In the context of intercity rail stations, such a district might more specifically be called a transportation improvement district (TID). The TID would involve designation of a welldefined geographic area around the station in which an additional property tax assessment would be levied on property owners, and the revenues from that tax would then be dedicated to repaying the station costs. In weighing the decision to pursue TIF or TID funding mechanisms, jurisdictions must evaluate not only the overall economic feasibility, but also the likelihood of successful implementation, and each approach has its pros and cons. TIF districts are currently in use in various locations across Virginia and are generally much easier to implement under existing legislation. However, the ease of creation is balanced by the significant uncertainty associated with the future revenue stream. The locality must consistently work with developers to ensure that the projected development actually occurs, and the development and resulting tax revenue may take a significant amount of time to come online. A TID, by contrast, can be quite difficult to set up under Virginia statute. Only Counties (not Cities) with population over 500,000 currently have the authority to pursue TIDs. Cities and smaller Counties wanting to pursue a TID will need legislative action by the General Assembly in order to be granted that authority. Moreover, even with that authority and with a popular planned investment, it can be very difficult to convince a majority of the property owners within the proposed district to agree to the extra assessment. However, once a TID is in place, it has the significant advantage of producing a sizable stream of revenue immediately upon its adoption. 0.5 Implementation: Infrastructure and Environment Other critical implementation steps include coordination of local infrastructure improvements (particularly transit service improvements and street grid upgrades) with station enhancements and land development/redevelopment projects. Unless the groundwork for development is clearly in place, investment in the station site will not occur at the desired scale or pace. This groundwork also includes proper documentation and mitigation of environmental issues associated with the site and its surroundings. Development of the scales and densities proposed around the Caroline County station will require an array of different transit services to complement increased intercity train service. This transit network would be centered on the proposed high density areas near the rail station and would provide frequent service to the station area from the town of Carmel Church and outlying portions of the planned development. The proposed new road infrastructure will consist of approximately 110,000 linear feet of new roads and streets. Of these new roads, 21,000 linear feet are assumed to be four-lane Technical Memorandum: Carmel Church Station 3

arterials, while the remainder would be smaller two-lane collectors. Pedestrian accessibility is promoted through a small block size design, and all roads and streets will have bike lanes and sidewalks. To increase accessibility within the site and to outside development, two motor vehicle bridges and one bridge exclusively for pedestrians will be constructed over the CSX rail line. An additional bridge for vehicular traffic will be constructed over I-95. To improve traffic control, four new signalized intersections will be created on Jefferson Davis Highway and Roger Clark Boulevard. Areas of potential environmental concern identified for this station area include forested areas, water resources, historic resources, and hazardous materials. Technical Memorandum: Carmel Church Station 4

1.0 PROJECT OVERVIEW This memo is one in a series of in depth station planning and land use analyses conducted by the Department of Rail and Public Transportation (DRPT). DRPT chose to undertake this project for the following reasons: Several recent high-profile reports and articles have called attention to the connection between recent land use trends and mounting economic, environmental, health, and social costs. In June the New York Times reported that even as home prices decline in outlying suburbs, some urban areas such as Washington D.C. have, instead seen an increase in property values. Americans are no longer able to justify auto dependent lifestyles given doubling fuel prices. The connection between land use and transportation is once again becoming intuitive beginning to shape daily decisions in a society where low fuel costs have been the norm for decades. Over the long term, this new calculus for deciding the where to live and where to do business will exert a stronger and stronger influence on land development patterns. With increasing rail service along the major metropolitan corridors in Virginia, it will become more and more possible for families and businesses to make location choices that minimize financial, environmental, and social costs. The stations will serve a variety of purposes, from daily commutes to occasional recreational trips. Over time, the station areas will become nodes of residential and economic activity. Market assessment can help predict the scale of potential development and the mix of appropriate land uses. It also helps decision makers to understand the level of focus that they will need to put toward these areas in order to channel development that would normally happen in other parts of their jurisdictions. Redevelopment of station areas over time can be planned to take advantage of economies of scale and the natural convergence of activities (density) at station areas. Urban design and planning shapes walkable town centers that are attractive to new residents, businesses, and travelers. These new developments must be wellserved by transit. In addition to the intercity and commuter rail transit that provide the focus for development, there must be a significant investment in local and regional transit that support and complement the rail service. The task of organizing new centers of development and financing major transit investments presents challenges for any jurisdiction. Jurisdictions that pursue these changes will need to develop an overarching strategy and follow aggressive timelines as they implement portions of the strategy. For example, zoning ordinances and plan review protocols will in many cases need to be adjusted substantially to achieve the desired land use densities and mix of uses. Technical Memorandum: Carmel Church Station 5

Figure 1-1: Project Station Locations Technical Memorandum: Carmel Church Station 6

2.0 DESCRIPTION OF STATION AND STATION AREA 2.1 Station function proposed service and relationship to other stations Caroline is a largely rural county located between Fredericksburg and Richmond. Interstate 95 extends through western Caroline, yet it has experienced little of the sprawling development that dominates the I-95 corridor in neighboring counties. This is, in part, due to forward thinking leadership and careful planning within the community. According to the 2004 Comprehensive Plan, Caroline recognizes that growth is inevitable, but will only accept development that benefits, rather than burdens, future generation. In 2000 the county population was 22,121. Since that time county population has grown at approximately 3% per year. Carmel Church, one of several subareas within the county, has absorbed about half of the county s growth since 2000. It was first identified as a primary growth center in the county s 1977 Comprehensive Plan and has retained this designation through subsequent comprehensive planning efforts. Currently, Carmel Church is the location for a county-led TOD planning initiative. The proposed TOD location is 27 miles south of Fredericksburg Station and 11 miles north of the Ashland Station on the existing CSX rail line. Figure 2-1 shows the proposed Carmel Church station location. 2.2 General overview of the study area at station location The proposed station location is a greenfield site bound by Route 1 to the west and I-95 to the east. The CSX rail line runs through the center of this site and has the dimensions to accommodate a 1200 foot platform. There are sensitive environmental features, such as wetlands and creeks, at the center of the site. The initial county TOD plans, however, demonstrate that these features can be protected and incorporated into a future dense development in this area. There is no existing development within a quarter mile of the station. There is a limited amount of residential single-family development within a half mile of the station. 2.3 Overarching themes for station area plan The station area plan provides additional detail and a few modifications to the Carmel Church Bubble Plan recently proposed for this location. It recommends establishment of two medium-scale, mixed-use centers, and a big box retail center. The plan emphasizes pedestrian scale development and clear circulation patterns throughout the site. Key elements of the plan include: Creation of two medium-scale, retail mixed-use neighborhood centers on the site, surrounding by medium to low scale residential development. Long-term high density development adjacent to I-95. Creation of a River Walk as a central feature of the TOD. Inclusion of a potential school site and several large recreation facilities. Big box retail at the northern end of the site. Minimum 100 buffers between Route 1 and the TOD, in order to maintain the road s rural character. Similar buffers between the TOD and Rogers Clark Boulevard and I- 95. Technical Memorandum: Carmel Church Station 7

Preservation of the environmentally sensitive and historically significant land at the southern end of the site. Phasing recommendations for implementation of the plan. Figure 2-1: Carmel Church Station Area Technical Memorandum: Carmel Church Station 8

3.0 LAND USE 3.1 Background / Existing Character Immediate Vicinity of Station The proposed station site is mostly undeveloped. What development exists near the site consists of scattered single-family residences east of Route 1 and south of Opal Lane. Surrounding Area Much of the area between Route 1 and Interstate 95 is currently undeveloped. Along Route 1, land uses are primarily residential, except for areas of industrial uses on Route 1 north of Opal Lane and further south opposite the intersection with Beverly Circle. 3.2 Planning Context Zoning Zoning on the site is primarily residential and industrial. Two large parcels fronting Route 1 and much of the land east of the CSX railroad are zoned M-1 (Industrial). The remaining parcels along Route 1 are zoned residential. The only commercial / business (B-1) zoning is located north of the site along Jericho Road and Rogers Clark Boulevard. Plans and Policies 1. Carmel Church Community Plan (January 2007) The Carmel Church Community Plan serves as part of the Caroline County Comprehensive Plan and provides a vision for future development in the Carmel Church community, which includes the study area. The plan recommends the development of a Village Core, or town center, in the Carmel Church community while preserving the surrounding rural landscape and quality of life. In the Village Core, located between Route 1 and Interstate 95, the plan envisions higher density development (10-15 units per acre) with a diversity of uses and a transit station at its center and gradually decreasing densities further away from the center. As envisioned, the Village Core also includes public facilities, such as a library, recreational areas and a usable public space at its center. Along Route 1, the plan anticipates residential and mixed-use development interspersed with two areas of industrial uses. 2. Caroline TOD Study: Bubble Plan This plan builds on the vision for a town center in Carmel Church that was first articulated in the Carmel Church Community Plan. The plan provides a general concept to allow for testing and advancement of development and transportation concepts for the site. It provides a representation of the scale and general arrangement of land use that is proposed for the site, including the central TOD site focused on a rail station and the surrounding parcels. The plan envisions the development of a town center on both the east and west sides of the railroad tracks and proposed station. On the east side, vertically integrated mixed-use development surrounds a town green adjacent to the proposed station. Multi-family residential uses are located to the north and south of the proposed mixed-use development, along with additional parking and a park at the northern end of the central site. On the west side, vertically-integrated mixed-use development surrounds a town green adjacent to the station with multi-family residential located to the west of these uses and parking located to the north adjacent to the railroad tracks. Technical Memorandum: Carmel Church Station 9

Outside the town center area, the plan envisions single-family residential to the east, between the town center and Route 1, and office/retail uses further north along Route 1 To the south of the town center, the plan includes areas of open space and a park/conservation area as well as a cultural amenity associated with a Civil War battlefield site. Development assumptions for the plan include estimates for low and high ranges of development. Low-range assumptions for the TOD central site include 399,600 square feet of office space, 220,000 square feet of retail and 1,500 multi-family residential units. Lowrange assumptions for the northern site include an additional 199,800 square feet of office space and 220,00 square feet of retail. High-range assumptions for the TOD central site include 549,450 square feet of office space, 320,00 square feet of retail and 3.500 multifamily residential units. High-range assumptions for the northern site include 274,725 square feet of office space and 320,000 square feet of retail. Moreover, the plan recommends a total of 1,500 single-family residential along Route 1 (no low or high range assumptions provided for these uses). Procedures for Updating and Amending Zoning and Plans The County will need to change its zoning, since the maximum density currently allowed is 10-15 dwelling units per acre. County staff have expressed an interest in developing a Transit-Oriented Development zone that incorporates form-based coding. Furthermore, since the Bubble Plan has not yet been reviewed by the public, the County will need to bring the public into the process at some point in the future. In addition, the County is looking to conduct additional studies to assess issues such as access from I-95 and needed infrastructure upgrades (particularly water and sewer). The County has already committed $500,000 for the next round of studies needed for plan implementation and has applied for additional funding. 3.3 Site Potential and Proposed Land Use The main goals of the proposed land use concept include: Maintaining the rural character of major roadways and entrances to the county Preserving as much of the North Anna River Civil War battlefield area as possible In early phases, establishing medium-scale village character and some higher-density mixed-use in those areas to the west of CSX rail line. In the long-term, most of the higher-scale mixed use occurs in the neighborhoods to the east of the CSX rail line Ensuring that the proposed big-box retail area is thoroughly buffered and segregated from Route 1 and Jericho Road Establishing undisturbed, 100-foot vegetative buffers between I-95 and the mixed-use area, along Route 1, and along Jericho Road / Rogers Clark Boulevard. The proposed land use concept, shown in Figures 3-1 and 3-2, builds on the general land use approach established in the TOD Study Bubble Plan. While it follows the general concept of the Bubble Plan to the west of the CSX railroad and maintains its approach to entrance locations in this area, it expands upon and modifies some aspects of the Bubble Plan in some respects. In the vicinity of the station on both sides of the railroad, the proposed concept recommends higher mixed-use densities in the long term, in order to maximize the potential of the transit station. It also diverges from the Bubble Plan in the addition of recreation uses and a potential school site to the east of the rail line, the removal of Technical Memorandum: Carmel Church Station 10

roundabouts from mixed-use areas on the west side of the railroad to improve pedestrian circulation, and the addition of new roundabouts in the northern portion of the study area. To preserve the visual character of Route 1, the proposed concept recommends a 100-foot vegetated buffer from the area north of Jericho Road to the North Anna River and along Jericho Road and Rogers Clark Boulevard at the northern edge of the study area. Examples of the concepts in this section are exhibited in Figure 3-3. The concept features high- and medium-scale mixed-use development in the vicinity of the proposed station, surrounded by low-scale mixed-use development and long-term, higherdensity mixed-use development located near I-95. Areas of small-lot, single-family detached and medium-density residential uses surround the mixed-use core. Mixed-use development is organized as two mixed-use neighborhoods with retail mixed-use cores. The first of these neighborhoods, located to the west of the rail line and closest to the Amtrak station, contains mixed-use at a variety of densities, with high-density development clustered closest to the train station and around a town green and lower densities to the north and west. Densities diminish in the areas closer to Route 1, where medium-scale residential surrounds a town park that serves as an entrance to the town center and a transition from the rural character along Route 1. Development transitions to single-family residential neighborhoods further north and south of the mixed-use core. The second mixed-use neighborhood contains higher-density, mixed-use development that is focused on a destination greenway lined with themed restaurants and retail. This destination area is surrounded by high-density residential uses and medium-density mixeduse development. Further north, a single-family residential neighborhood separates the mixed-use core from another mixed-use center oriented around a proposed school site and a large recreation area. Parking in all mixed-use area is envisioned as structured parking. However, structured parking may be phased in over time from surface parking as new development occurs. The retail area located in the northern portion of the study area incorporates all undeveloped parcels between the town center and Rogers Clark Boulevard. This area is envisioned as a potential location for big box types of retail uses. The concept calls for one major throughaccess route in this area, an extension of Welcome Way Drive that connects to the mixeduse area to the south. Traffic circles are recommended in the retail area to help accommodate higher traffic flows. An undisturbed, 150-foot buffer separates the retail area from I-95. The concept recommends that no additional access points should be added to either Route 1 or Rogers Clark Boulevard. A battlefield preservation and interpretative area is recommended for the area south of Gravel Hill Road. Some residential estate uses (2-acre minimum) are proposed along the northern edge of the battlefield as a low-impact use for some of the outer battlefield areas. A battlefield drive is planned for those areas on both sides of the railroad, with access only from inside of the proposed development and a loop road that curves back to the main road. Three bridges provide access to the mixed-use areas to the east of the rail station and the CSX railroad. In the long term, a fourth bridge will cross both the proposed outer ring road and I-95. A separate pedestrian bridge also connects the station to the River Walk area and eastern portion of the town center. The concept includes guiding assumptions for access to future development. In the initial phases of development, Route 1 is envisioned as the major access point to the development. For the later, more intense phases of mixed-use and big box retail development, an extension of the existing Welcome Way will serve as a primary access point to the Technical Memorandum: Carmel Church Station 11

development and will help address traffic-related impacts on Route 1 and in the vicinity of the battlefield. By utilizing a connected street grid and four entrances off of Route 1, the overall goal is to reduce street widths and keep blocks compact. Entrances from Route 1 should feel integral to the rural road network surrounding the area proposed for development. The connected road network reduces bottlenecks and enables these compact entrances. To create the traditional neighborhood design called for in the Carmel Church Community Plan, alleys (see Figures 3-4 B and C) are essential elements. All residential-only uses are accessed off of 24-foot-wide alleys for service and parking, while only the proposed residential estate development is accessed via front driveway. Moreover, all mixed-use areas with commerce at ground floor will be accessed off of 30-foot-wide alleys. Proposed build-to lines for streets are illustrated in Figure 3-4 A. The public streetscape between the build-to lines is envisioned as a key part of the community open space system and includes curbside stormwater management, except on those streets facing commerce (retail or office) ground-floor use. Public squares and greens should be appropriately sized (not too big), should appear busy and well-utilized, even in the early phases of development, and shall be contained by public streetscapes on at least two sides. The average floor area ratio for developable parcels is 3.6 (not including public spaces such as streets, open space and railroad corridors). Development Assumptions Area of Estimate: Estimate includes all areas of proposed change within the 1/4-mile distance from the Amtrak Station. Use Types o Low-Scale Mixed Use: Ground-level commerce (office or retail) required, upper floors residential or office use; 3-floor-maximum building height (3 floor height used in estimates); Surface parking provided; floor area ratio of 1.2. o Medium-Scale Mixed Use: Ground level commerce (office or retail) required; upper floors residential or office us; 5-floor-maximum building height (4 floors average used for estimate); above-grade, structured parking provided in block center; floor area ratio of 2.0. o High-Scale mixed Use: Ground-level commerce (office or retail) required; upper floors residential or office; 8-floor-maximum height (7 floors used for estimate); above-grade structured parking provided in block center; floor area ratio of 3.5. o Medium-scale residential (Townhouse or small multifamily / condominium building): 3-floor-maximum height; parking provided in unit garage on alley; floor area ratio of 1.5. Average residential/ office mix for all low-scale, medium-scale and high-scale upper floors = 20% Office, 80% Residential Residential units are calculated at average 1000 GSF per multifamily / condominium unit and 1,500 GSF per townhome. Parking strategy: A parking strategy is utilized with a maximum quantity required for dedicated parking and a minimum quantity required for shared parking for each project. Technical Memorandum: Carmel Church Station 12

If the developer wishes to allocate more dedicated parking than the maximum, the developer must assist funding of district-wide shared parking facilities. On street parking adjacent to each development can be used to meet the shared parking requirement. 3.4 Site Constraints Constraints to development include significant environmental constraints in the form of wetlands and Chesapeake Bay Resource Protection Areas. Other development challenges include protection of an important Civil War battlefield site on southern portion of the site and the need to maintain the rural character of Route 1 as it passes through the study area. In addition, development on both sides of the railroad will require significant investment in bridge construction to enable access to the eastern portion of the study area. Bridge length to accommodate pedestrian and automobile traffic over CSX lines was major constraint in the design of the internal circulation system. Technical Memorandum: Carmel Church Station 13

Figure 3-1: Carmel Church Station Proposed Land Use - Concept Plan Technical Memorandum: Carmel Church Station 14

Figure 3-2: Carmel Church Station Illustrative Plan Technical Memorandum: Carmel Church Station 15

Figure 3-3: Example Photographs A. Example of medium-density housing in the form of small- lot, single-family residential, as recommended for Carmel Church. All of these homes have their parking and service access off of rear alleys B. An example of the low-scale mixed use, which includes buildings of 2 or 3 floors with office or residential on the upper floor(s). C. An example of town houses, as recommended for the medium-scale residential areas indicated on the land use plan. D. This residential mixed-use area is similar in scale to that recommended for the high-scale mixed-use areas in the land use plan. F. An example precedent for the special entertainment district, with its mediumscale mixed use structures surrounding paved and planted open spaces. This area is located in a natural depression, and water could be a featured element of the open spaces G. Three vehicular and pedestrian bridges will be needed to cross the railroad and the adjacent stream and buffer. This is an example of a bridge design suitable to cross both an urban neighborhood and a natural area. Brick and precast would facilitate the creation of timeless civic minded bridges H. The southern portion of the plan, facing the North Anna River, is the site of a civil war battlefield. The railroad bridge at that location was destroyed as part of the battle, as shown in the photograph above. A visitor s center and battlefield drive has been recommended as part of the plan. I. Technical Memorandum: Carmel Church Station E. Another example for high-scale mixed use, as recommended in the plan. Rendering of General Mead s troops building pontoon bridges across the North Anna River. Battle maps indicate several of these bridges being constructed at the southern portion of the project site. 16

Figure 3-4: Thoroughfare and Alley Sketches A. Illustration of the 66 width (between building walls) thoroughfare used for most of the interior connecting streets in the various plans. B. Illustration of the 24 foot width alley used for the residential districts. C. Illustration of the 30 foot width alley used for mixed use sites. Technical Memorandum: Carmel Church Station 17

4.0 MARKET CONDITIONS The proposed station at Carmel Church will be sited in one of Caroline County s three designated growth areas. Current build-out is occurring in the Ladysmith growth area, the third designated area is the county seat, Bowling Green. The Carmel Church site has been designated for TOD and has the support of the Caroline County Board and the property owner. Obstacles to development are minimal as the majority of the land is controlled by one owner and the Board is extremely supportive of new urbanism approach to development. The Amtrak service and a station sited at Carmel Church are a necessary component for development to move forward. Current land uses are forest land and scattered low value residential. The major real estate firms that track trends and provide projections for various classes of property do not cover Caroline County. The market assessment was developed based on employment and population data. Employment is the primary driver for commercial space and population is the primary driver fueling demand for residential and retail. The area around the proposed station in Carmel Church has outstanding potential from a market perspective. The land is controlled by one owner, who is encouraging development The current land use is forest land and low value residential providing a land use footprint for any type of desired development Carmel Church is within commuting distance to both the Washington DC and Richmond areas The rural setting is attractive to various demographics for residential product at different pricing points Current full service retail for Caroline County is located in Fredericksburg and north of Richmond making the Carmel Church area an attractive alternative The site will have access to I-95 4.1 Office Demand for office space in Caroline County was developed based on employment projections to 2030. Since the projections include all industries the employment figures were scaled down to reflect those industries that typically require office space, e.g., FIRE, government, professional and technical services. These data we accessed from the Virginia Employment Commission and were current as of September 2007. An assumption of 200 square feet per employee was used to estimate the space requirements on a yearly basis from County employment growth. Cost per square foot was taken from RS Means Square Foot Costs for office structures of five to ten stories. Costs were escalated at 3.3 percent per year from the Construction Cost Index reported by Engineering News Record. The projections from 2013 through 2030 are shown in Table 4-1. Over the 18 year period, employment increases will require about 292,000 square feet of office space, with a construction value of over $58 million. This will generate property taxes of $2.7 million over the same time period, assuming the tax rate for 2008 at $0.530 per $100 or assessed value. Technical Memorandum: Carmel Church Station 18

Table 4-1: Office Construction Value and Tax Revenue Caroline County YEAR CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 $ 2,433,804 $ 12,899 2014 $ 4,947,924 $ 26,224 2015 $ 7,545,009 $ 39,989 2016 $ 10,227,799 $ 54,207 2017 $ 12,999,120 $ 68,895 2018 $ 15,861,896 $ 84,068 2019 $ 18,819,142 $ 99,741 2020 $ 21,873,978 $ 115,932 2021 $ 25,029,624 $ 132,657 2022 $ 28,289,405 $ 149,934 2023 $ 31,656,760 $ 167,781 2024 $ 35,135,237 $ 186,217 2025 $ 38,728,504 $ 205,261 2026 $ 42,440,349 $ 224,934 2027 $ 46,274,684 $ 245,256 2028 $ 50,235,553 $ 266,248 2029 $ 54,327,131 $ 287,934 2030 $ 58,553,730 $ 310,335 Total $ 2,678,512 The site plan for the Carmel Church Station indicates build-out of 636,500 square feet of office space, which is about double the total projected for Caroline County. While this could be viewed as somewhat aggressive, it may be supported by attracting commercial tenants that rely on travel to the Washington DC and/or Richmond areas, which would be easily accommodated by the enhanced Amtrak service. Additionally, Carmel Church probably is the most attractive location to focus commercial development in Caroline County given the combination of access to I-95 and frequent rail service. Development sites in Caroline County are constrained by the presence of Fort A.P. Hill, which currently occupies approximately one-half of the land area of the county. Table 4-2 shows the construction value and property tax for 2013 though 2030 for the Carmel Church Station area. Technical Memorandum: Carmel Church Station 19

Table 4-2: Office Construction Value and Tax Revenue Carmel Church Station Area YEAR CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 $ 4,802,182 $ 25,452 2014 $ 9,762,837 $ 51,743 2015 $ 14,887,193 $ 78,902 2016 $ 20,180,652 $ 106,957 2017 $ 25,648,796 $ 135,939 2018 $ 31,297,389 $ 165,876 2019 $ 37,132,385 $ 196,802 2020 $ 43,159,936 $ 228,748 2021 $ 49,386,396 $ 261,748 2022 $ 55,818,330 $ 295,837 2023 $ 62,462,517 $ 331,051 2024 $ 69,325,962 $ 367,428 2025 $ 76,415,901 $ 405,004 2026 $ 83,739,808 $ 443,821 2027 $ 91,305,405 $ 483,919 2028 $ 99,120,665 $ 525,340 2029 $ 107,193,830 $ 568,127 2030 $ 115,533,408 $ 612,327 Total $ 5,285,020 4.2 Retail Demand for retail space was developed based on population projections to 2030. The U.S. Census-Quick Facts reported retail sales per capita for Caroline County at $11,359. Increases in population were applied to the retail sales per capita to derive total sales. To estimate the square feet needed as additions to retail stock a value of $300 per square foot per year was used. This is an average that takes into consideration varying categories of retail from General Merchandise at $154 per square foot per year to Jewelry at $748 per square foot per year. Cost per square foot was taken for RS Means Square Foot Costs. Costs were escalated at 3.3 percent per year from the Construction Cost Index reported by Engineering News Record. The projections from 2013 through 2030 are shown in Table 4-3. Over the 18 year period, retail space is projected to increase by about 489,000 square feet, with a construction value of over $67 million. This will generate property taxes of $3.1 million over the same time period, assuming the tax rate for 2008 at $0.530 per $100 or assessed value. Technical Memorandum: Carmel Church Station 20

Table 4-3: Retail Construction Value and Tax Revenues Caroline County YEAR POPULATION TOTAL CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 31,455 $ 357,302,267 $ 2,819,512 $ 14,943 2014 32,173 $ 365,458,408 $ 5,732,069 $ 30,380 2015 32,892 $ 373,614,549 $ 8,740,739 $ 46,326 2016 33,610 $ 381,770,689 $ 11,848,696 $ 62,798 2017 34,328 $ 389,926,830 $ 15,059,215 $ 79,814 2018 35,046 $ 398,082,970 $ 18,375,681 $ 97,391 2019 35,764 $ 406,239,111 $ 21,801,591 $ 115,548 2020 36,482 $ 414,395,252 $ 25,340,556 $ 134,305 2021 37,200 $ 422,551,392 $ 28,996,307 $ 153,680 2022 37,918 $ 430,707,533 $ 32,772,697 $ 173,695 2023 38,636 $ 438,863,674 $ 36,673,708 $ 194,371 2024 39,354 $ 447,019,814 $ 40,703,453 $ 215,728 2025 40,072 $ 455,175,955 $ 44,866,179 $ 237,791 2026 40,790 $ 463,332,095 $ 49,166,276 $ 260,581 2027 41,508 $ 471,488,236 $ 53,608,275 $ 284,124 2028 42,226 $ 479,644,377 $ 58,196,860 $ 308,443 2029 42,944 $ 487,800,517 $ 62,936,869 $ 333,565 2030 43,662 $ 495,956,658 $ 67,833,298 $ 359,516 Total $ 3,103,002 The site plan for the Carmel Church Station indicates build-out of 636,500 square feet of retail space, which is about 130 percent of the total projected for Caroline County. From a strict comparison of development totals it appears unreasonable that the station area plan could exceed County totals. The County totals are based on growth projections of population. This does not take into consideration the retail opportunities in the County. According to the County Business Patterns for 2005, there were 67 establishments in Caroline County engaged in retail trade, 39 of which had 1 to 4 employees. This implies that 58 percent of retail consists of extremely small operations (mom and pop stores). This causes County shoppers to travel to Fredericksburg and Richmond for a variety of shopping needs. The retail build-out associated with the Carmel Church site plan may reflect the reality of bringing more and varied shopping opportunities to a vastly underserved market. Additionally, the site plan has 2,935 residential units, which will provide substantial demand for retail. Table 4-4 shows the construction value and property tax for 2013 though 2013 for the Carmel Church Station area. Technical Memorandum: Carmel Church Station 21

Table 4-4: Retail Construction Value and Tax Revenues Carmel Church Station Area YEAR TOTAL CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 $ 357,302,267 $ 3,667,216 $ 19,436 2014 $ 365,458,408 $ 7,455,449 $ 39,514 2015 $ 373,614,549 $ 11,368,694 $ 60,254 2016 $ 381,770,689 $ 15,411,077 $ 81,679 2017 $ 389,926,830 $ 19,586,858 $ 103,810 2018 $ 398,082,970 $ 23,900,440 $ 126,672 2019 $ 406,239,111 $ 28,356,370 $ 150,289 2020 $ 414,395,252 $ 32,959,345 $ 174,685 2021 $ 422,551,392 $ 37,714,219 $ 199,885 2022 $ 430,707,533 $ 42,626,004 $ 225,918 2023 $ 438,863,674 $ 47,699,878 $ 252,809 2024 $ 447,019,814 $ 52,941,189 $ 280,588 2025 $ 455,175,955 $ 58,355,464 $ 309,284 2026 $ 463,332,095 $ 63,948,410 $ 338,927 2027 $ 471,488,236 $ 69,725,923 $ 369,547 2028 $ 479,644,377 $ 75,694,094 $ 401,179 2029 $ 487,800,517 $ 81,859,214 $ 433,854 2030 $ 495,956,658 $ 88,227,784 $ 467,607 Total $ 4,035,937 4.3 Residential The market for residential housing is largely determined by population and household size. Projections for Caroline County show population increasing from the 2000 Census figure of 22,121 to 43,662 in year 2030. Average household size as reported in the 2000 Census was 2.69 persons per household. Based on these data the demand for residential product can be estimated on a yearly basis. Yearly increases in population averaging 718 per year will require an addition of 267 residential units Assuming 1,000 square feet per unit equates to build-out of 267,000 square feet per year of residential product Total construction value exceeds $1 billion for 2013 through 2030 Total tax revenue over the 18 year period from 2013 through 2030 is $100 million Table 4-5 shows the increase in property taxes on a yearly basis from 2013 to 2030 as the 4,800,000 square feet of residential product enters the market. Technical Memorandum: Carmel Church Station 22

Table 4-5: Housing Demand, Construction Value and Tax Revenue Caroline County YEAR CONSTRUCTION VALUE (Annual) CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 $ 44,076,360 $ 44,076,360 $ 233,605 2014 $ 45,530,880 $ 89,607,240 $ 985,680 2015 $ 47,033,399 $ 136,640,639 $ 1,503,047 2016 $ 48,585,501 $ 185,226,140 $ 2,037,488 2017 $ 50,188,823 $ 235,414,963 $ 2,589,565 2018 $ 51,845,054 $ 287,260,017 $ 3,159,860 2019 $ 53,555,941 $ 340,815,958 $ 3,748,976 2020 $ 55,323,287 $ 396,139,244 $ 4,357,532 2021 $ 57,148,955 $ 453,288,199 $ 4,986,170 2022 $ 59,034,871 $ 512,323,070 $ 5,635,554 2023 $ 60,983,021 $ 573,306,092 $ 6,306,367 2024 $ 62,995,461 $ 636,301,553 $ 6,999,317 2025 $ 65,074,311 $ 701,375,864 $ 7,715,135 2026 $ 67,221,764 $ 768,597,628 $ 8,454,574 2027 $ 69,440,082 $ 838,037,709 $ 9,218,415 2028 $ 71,731,605 $ 909,769,314 $ 10,007,462 2029 $ 74,098,747 $ 983,868,061 $ 10,822,549 2030 $ 76,544,006 $ 1,060,412,067 $ 11,664,533 Total $100,425,826 The site plan for the Carmel Church Station area indicates build-out of 2,935 residential units totaling 3,249,500 square feet which is about 67 percent of the total projected for Caroline County. This appears to be a reasonable share for an area that is a designated growth area emphasizing TOD that will greatly exceed current densities in the County. Table 4-6 shows the construction value and property tax for 2013 though 2030 for the Carmel Church Station area. Technical Memorandum: Carmel Church Station 23

Table 4-6: Housing Demand, Construction Value and Tax Revenue Carmel Church Station Area YEAR CONSTRUCTION VALUE (Annual) CONSTRUCTION VALUE (Cumulative) PROPERTY TAX (Annual) 2013 $ 32,308,400 $ 32,308,400 $ 171,235 2014 $ 33,374,577 $ 65,682,976 $ 722,513 2015 $ 34,475,938 $ 100,158,914 $ 1,101,748 2016 $ 35,613,644 $ 135,772,558 $ 1,493,498 2017 $ 36,788,894 $ 172,561,452 $ 1,898,176 2018 $ 38,002,928 $ 210,564,380 $ 2,316,208 2019 $ 39,257,024 $ 249,821,404 $ 2,748,035 2020 $ 40,552,506 $ 290,373,910 $ 3,194,113 2021 $ 41,890,739 $ 332,264,648 $ 3,654,911 2022 $ 43,273,133 $ 375,537,781 $ 4,130,916 2023 $ 44,701,146 $ 420,238,928 $ 4,622,628 2024 $ 46,176,284 $ 466,415,212 $ 5,130,567 2025 $ 47,700,102 $ 514,115,313 $ 5,655,268 2026 $ 49,274,205 $ 563,389,518 $ 6,197,285 2027 $ 50,900,254 $ 614,289,772 $ 6,757,187 2028 $ 52,579,962 $ 666,869,734 $ 7,335,567 2029 $ 54,315,101 $ 721,184,835 $ 7,933,033 2030 $ 56,107,499 $ 777,292,334 $ 8,550,216 Total $ 73,613,105 4.4 Summary For all classes of development, construction value is estimated to generate about $78 million in property taxes from 2013 through 2030 at the Carmel Church Station Area. This is about 70 percent of the property taxes projected for Caroline County from new development over the same time period. This appears to be reasonable since the existing land use encourages a bold vision for TOD and approvals by the County would act to focus growth around the station area. Additionally, Carmel Church is one of only three designated growth areas and will most likely build-out with greater density because of the Amtrak service, access to I-95, and an existing land area and ownership that encourage the desired planned development. Technical Memorandum: Carmel Church Station 24

5.0 Economic Impact This analysis assesses the economic effects of the projected real estate development in the Carmel Church Station Area. Commercial, retail and residential impacts are assessed. The analysis projects the economic effects that construction expenditures to develop the sites around Carmel Church would have on the State of Virginia economy in terms of increased employment and related economic effects 1. The construction activity represents the most immediate impact of the station-area real estate investments. Construction firms hire workers and purchase materials and support services in the local economy in order to complete the project. This is the direct effect on the economy. The construction workers earnings translate into a proportional increase in consumer demand as these workers purchase goods and services in the region across a variety of industrial sectors. The jobs and incomes supported through the circulation of these earnings in the state economy represent the station area development s indirect impact. The economic impacts associated with construction expenditures in the station areas are measured using regional multipliers from the Bureau of Economic Analysis (BEA) within the U.S. Department of Commerce. Derived from the Regional Input-Output Modeling System, the so-called RIMS II multipliers measure the total change (direct + indirect effects) in output, employment, and earnings that results from an incremental change to a particular industry. The multipliers were constructed by BEA to reflect the Virginia economy. The multipliers are based on the 2005 Annual Input-Output Table for the nation and 2005 regional accounts data; they represent the most updated version available at the time this analysis was prepared. The economic impact analysis builds on the findings of the Carmel Church Market Analysis, using the projections of commercial, retail, and residential construction to provide a consistent estimate of economic impacts. Projections of development and the attendant construction costs refer to the station area plans. 5.1 Earnings, employment and output effects from capital expenditures Construction of the station area development projects represents significant capital investment in the local economy. This spending will increase the employment, earnings and output for the duration of the construction process, projected to occur between 2013 and 2030 in the Market Analysis. Capital cost estimates/construction values for this analysis are presented in year of expenditure dollars to be consistent with the analysis developed in the Market Analysis. The following section describes the project expenditures and anticipated economic impacts. 5.2 Capital expenditures The capital expenditures for construction of the station area developments range widely across property type. At the low end of the cost range are the projections for commercial and retail investment at $115 million and $88 million, respectively. The projections for residential investment in the station area are much higher at $777 million. Although every building material required for the project may not be produced in Virginia, the RIMS II multipliers reflect the supplier linkages for the industry, and thus account for this leakage from the state economy. 1 The investment to construct and improve the stations themselves would have a similar impact on the economy; project costs are not yet available at the time of this analysis to permit an economic assessment. Technical Memorandum: Carmel Church Station 25

Construction costs are assumed to include materials and labor and are funded 100% by the private sector. There is no land costs included in the construction costs. 5.3 Construction impacts The net construction cost derived in Table 5-1 is translated into an economic impact through the application of the multipliers, as shown in the middle rows of the exhibit, labeled Construction Multipliers. Because the multipliers summarize information about Virginia s economy, they are the same across all the property types. The interpretation of the multipliers for the construction industry shown in Table 5-1 is as follows. The Final Demand Earnings Multiplier represents the total dollar change in earnings of households employed by all industries for each additional dollar of output delivered to final demand by the construction industry. The Final Demand Employment Multiplier represents the total change in number of jobs that occurs in all industries for each $1 million of output delivered to final demand by the construction industry. The Final Demand Output Multiplier represents the total dollar change in output that occurs in all industries for each additional dollar of output delivered to final demand by the construction industry. Applying the Final Demand Multipliers for the construction industry to the amount of new resources that will be used for capital expenditures provides estimates of the net earnings, employment, and output impacts generated by each development scenario. The results are summarized in the bottom rows of Table 5-1, labeled Construction Impact. Note that these are one-time impacts that last for the duration of the project s construction. One job is defined as a job for one person of one year s duration. As an example, a job for one person that had duration of three years would be defined as three jobs. There are no long-term effects associated with the economic impacts generated by capital expenditures. Construction-related impacts last for the duration of the buildout around the station. Just as the expected investment varies across property type, the economic impacts vary as well. Job impacts range from a low of 845 jobs over the 18-year period or about 47 jobs per year attributable to the retail development investment to a high of 7,444 over the same 18-year period for an average of 413 jobs per year for the residential development. Technical Memorandum: Carmel Church Station 26

Table 5-1: Projected Construction Impacts by Property Type at Carmel Church Station CARMEL CHURCH STATION STATION AREA DEVELOPMENT SCENARIO Commercial Retail Residential COST (YOE$) Total Construction Cost (materials and labor) $115,533,408 $88,227,784 $777,292,334 CONSTRUCTION MULTIPLIERS Earnings 0.662 0.662 0.662 Employments 17.6265 17.6265 17.6265 Output 2.1826 2.1826 2.1826 CONSTRUCTION IMPACT Earnings $76,483,116 $48,406,793 $514,567,525 Employment 1,106 845 7,444 Output $252,163,216 $192,565,961 $1,696,518,248 Notes: As the Final Demand Employment multiplier is based on 2005 data, the capital expenditure is deflated to 2005 dollars for this calculation. Technical Memorandum: Carmel Church Station 27

6.0 Potential Local Funding Mechanism A critical step in the implementation of the Caroline County Station is the ability to fund the local share of the station s construction costs. In addition to the station building itself, these costs may include additional investment in utilities, parking, and other civil improvements such as drainage. No formal estimates of station capital costs have been prepared for the proposed Station, but DRPT generally expects that local jurisdictions will be asked to fund a significant portion of the cost of station improvements to support expanded intercity rail service. In order to explore potential local funding options, this section assumes that local funding of $5 million will be necessary for the Caroline County Station. This amount is intended simply as a placeholder and is noted as such throughout this section. Any future estimates of costs and funding needs will require both a detailed engineering cost analysis and a policy decision by DRPT about the share of costs that localities will have to provide. This section provides an analysis of a potential mechanism that Caroline County could use to generate its share of the required funds for station improvements. Tax Increment Financing (TIF). The analysis is a theoretical example designed to illustrate the general economic viability of this mechanism and does not speak to any specific technical issues that would need to be addressed in order to achieve successful implementation. However, a brief discussion of feasibility, given the broad economic and legal constraints in the Commonwealth and in Caroline, is provided at the end of this section. 6.1 Tax Increment Financing Tax increment financing (TIF) is widely used in Virginia and across the United States as a method for financing current investments (including public infrastructure such as rail stations) by capturing and dedicating expected future gains in property tax revenues in the area around the investment and using those gains to pay back the investment s initial cost. To assess the economic viability of a TIF for the Caroline County Station, the placeholder local funding assumption of $5 million is compared to the net present value (NPV) of the stream of incremental property tax revenues resulting from future development around the station for the period from 2013 to 2030. These dates were selected as the estimate for when station construction would likely be undertaken and as a reasonable period for the incremental property tax revenues to be dedicated. The assumptions, methodology, and results for this analysis are outlined below. Assumptions In addition to projections of the station cost and future development around the station, the TIF analysis relies on assumptions about inflation rates and discount rates. These rates are preliminary estimates, and more detailed projections of these rates would be used in any future analyses. Construction cost inflation: An annual rate of 3.3% is used to inflate the station cost estimates from 2008 to 2013 dollars. As a comparison, the Florida DOT is currently using 3.3% as its long-run cost inflation figure. Discount rate: A discount rate of 5.5% is used in the calculation of NPV. Technical Memorandum: Carmel Church Station 28

Methodology The methodology used in the TIF analysis is summarized below: 1. A placeholder local funding amount of $5 million for the Caroline County Station was assumed. 2. Preliminary real estate development estimates for each station were received and analyzed. (These are the same development estimates described in previous sections of this report.) These estimates provide annual projected incremental property tax revenue for three major development categories (office/commercial, retail, and residential) around the Caroline County Station for the period from 2013 to 2030. 3. The net present value of the stream of incremental property tax revenue from Step 2 was calculated and compared to the placeholder local funding amount Step 1. This allows for the determination of the required portion of the incremental property revenue that must be dedicated to the Caroline County Station through a TIF in order to equalize the assumed local funding and the NPV of the dedicated future revenues. A discount rate of 5.5% was used in the calculation of NPV. The results are summarized in Table 6-1, which presents the placeholder local funding assumption, the NPV of the incremental tax revenue, and the required portion of the incremental tax revenue that would need to be dedicated as a TIF. Table 6-1: Caroline County Station TIF Summary Example "Placeholder" Local Funding Assumption (2013) $5.0 million NPV of Incremental Tax Revenue from Development $43.2 million Required Portion of Increment Dedicated to Station 12% Table 6-2 presents the detailed annual calculations of incremental property tax revenue for Caroline County Station. Technical Memorandum: Carmel Church Station 29

Table 6-2: Incremental Property Tax Revenues for Caroline County Station YEAR COMMERCIAL/ OFFICE RETAIL RESIDENTIAL TOTAL DEDICATED SHARE OF TOTAL 2013 $25,452 $19,436 $171,235 $216,122 $25,011 2014 $51,743 $39,514 $722,513 $813,770 $94,174 2015 $78,902 $60,254 $1,101,748 $1,240,904 $143,604 2016 $106,957 $81,679 $1,493,498 $1,682,134 $194,666 2017 $135,939 $103,810 $1,898,176 $2,137,925 $247,412 2018 $165,876 $126,672 $2,316,208 $2,608,757 $301,899 2019 $196,802 $150,289 $2,748,035 $3,095,126 $358,185 2020 $228,748 $174,685 $3,194,113 $3,597,545 $416,327 2021 $261,748 $199,885 $3,654,911 $4,116,544 $476,389 2022 $295,837 $225,918 $4,130,916 $4,652,671 $538,432 2023 $331,051 $252,809 $4,622,628 $5,206,489 $602,523 2024 $367,428 $280,588 $5,130,567 $5,778,583 $668,729 2025 $405,004 $309,284 $5,655,268 $6,369,557 $737,120 2026 $443,821 $338,927 $6,197,285 $6,980,032 $807,767 2027 $483,919 $369,547 $6,757,187 $7,610,654 $880,746 2028 $525,340 $401,179 $7,335,567 $8,262,085 $956,133 2029 $568,127 $433,854 $7,933,033 $8,935,014 $1,034,008 2030 $612,327 $467,607 $8,550,216 $9,630,150 $1,114,453 Total $5,285,020 $4,035,937 $73,613,105 $82,934,062 $9,597,579 Net Present Value (at 5.5%) $43,205,721 $5,000,000 Results As Table 6-1 above shows, Caroline County would need to dedicate approximately 12% of the incremental property tax revenue generated by the projected new development around the proposed Station from 2013 to 2030 in order to support the placeholder $5 million local funding assumption. 6.2 General Assessment of the TIF Mechanism in Virginia In weighing the decision to pursue TIF funding, a local jurisdiction must evaluate not only the overall economic feasibility, but also the likelihood of successful implementation, and the approach has its pros and cons. TIF districts are currently in use in various locations across Virginia and are generally much easier to implement under existing legislation. However, the ease of creation is balanced by the significant uncertainty associated with the future revenue stream. The locality must consistently work with developers to ensure that the projected development actually occurs, and the development and resulting tax revenue may take a significant amount of time to come online. The risk associated with this uncertainty and potential for delay may make it prohibitively expensive to attempt to finance the station costs with a pure TIF-backed revenue bond. Thus, many localities have used different versions of a shadow TIF approach: Shadow TIF (Weak): In this approach, the City or County does not actually set up the TIF district, and any bonds issued to pay for upfront investment costs are general obligation (GO) debt, as is normally the case for infrastructure investment in a locality. However, the results of the TIF analysis demonstrating the expected future Technical Memorandum: Carmel Church Station 30

development and tax revenues are used to convince the public of the worth of the investment and its ability to pay for itself over time. Shadow TIF (Strong): In this approach, the City or County does actually designate and create a TIF district and segregates the incremental property tax revenues in that district into a separate account which is dedicated to paying back the investment costs. However, the bonds are still GO bonds (thus avoiding the high costs associated with a pure TIF-backed revenue bond), and City or County general funds are likely to be used to pay debt service in the early years, while TIF revenues are still building. In later years, once the majority of the development has occurred, the TIF fund would then be able to take over the debt service and also pay back the general fund for its earlier expenditures. Technical Memorandum: Carmel Church Station 31

7.0 SUPPORTING TRANSPORTATION ANALYSIS 7.1 Roadway Network Understanding existing and future traffic conditions around the future station site helps define the potential of the existing roadway network to accommodate new demand for accessibility to the station site. The analysis is based on existing traffic conditions near the station. Future conditions are estimated based on projected growth patterns, and future build conditions are estimated assuming the proposed land use plans and improved rail transportation access. Existing Conditions The Caroline County station site is located in a rural area along the CSX Main Line near Carmel Church and approximately ½ mile west of I-95 and ¼ mile east of Jefferson Davis Highway (US 1). The road network in the vicinity of this site is very sparse and there are currently no connections to the road network from the proposed station. Pennsylvania Avenue, a southeast/northwest running road from Jefferson Davis Highway, comes to a dead-end about 1,000 feet northwest to the site. This is the closest road to the site. The closest significant road is nearly two miles to the north where Jefferson Davis Highway crosses the east/west running Jericho Road/Rogers Clark Boulevard (Rt. 207). At the Caroline location, sample 15 minute counts were conducted for Jefferson Davis Highway and Jericho Road/Rogers Clark Boulevard at their intersection during the AM and PM peak hours. This count was converted into a peak 1 hour count. Signal cycle lengths were also measured in the field. This data was used to develop a Synchro traffic model at this key intersection which will help planners understand existing traffic behavior. The model serves as the basis for forecasts of future conditions as it is expanded to include several proposed intersections. No Build 2030 Conditions Based on data provided by the Fredericksburg Area Metropolitan Planning Organization, traffic growth factors were developed around the station. These growth factors were applied to the key intersection in the vicinity of the station site. A growth rate reflecting proposed employment and population growth within a quarter mile of the station was used to estimate the change between current and 2030 No Build traffic volumes, as shown in Table 7-1 below. Table 7-1: Derivation of Traffic Growth Factors Study Area Percent of Population Change 2000-2030 Percent of Employment Change 2000-2030 Caroline Station CAROLINE COUNTY 97.38% 106.91% Traffic Factor Growth 2000-2030 Quarter Mile 110.00% 150.00% 130.00% Half Mile 97.30% 100.00% 98.65% The key traffic signal was optimized for the No Build 2030 volumes using Synchro. No planned land development projects in the vicinity of the station could be identified, therefore the future year signal cycle length and lane configuration is assumed to be the same as existing conditions. Technical Memorandum: Carmel Church Station 32

Build Conditions Based on the Intercity Ridership Forecasting model, Regional Travel Demand model, and economic and land use assumptions, the increase in travel activity around the station area was estimated for peak travel periods. Figure 7-1 demonstrates this process through a flow chart. Based on recent surveys conducted by Amtrak, the mode split, or portion of model trips for each station access mode was estimated. This ridership component also reflects future trips based on proposed changes in land use and density that might attract additional trips. Based on the preferred combination of land use/ density and ridership at the station, the Synchro model was updated with the Build 2030 traffic volumes. Figure 7-1: Concept for Growth in Traffic Volumes Build Condition 2030 traffic Volumes = No Build 2030 traffic volumes + Trips based on change in ridership (A) Two major components are expected to affect Build traffic conditions: + Trips due to proposed development at the station (B) A. Trips based on Amtrak ridership growth. Ridership projections for No Build and Build options as well as assumed mode of access are shown in Table 7-2. B. Trips based on proposed development at the station. These trips were projected using the land use densities proposed as part of the land use plan and assuming trip generation rates according to Institute of Transportation Engineers (ITE) standard practice. Table 7-2: Ridership Projections for Caroline County Station 2030 - Total Annual Ons & Offs by Option No Build - Low No Build - High Option 1 - Low Option 1 - High Caroline County 0 0 46,975 51,494 Notes: 1. No Build represents current Amtrak service in 2030 2. Option 1 represents new service at Caroline County, improved frequency and travel times in Newport News - Richmond - DC corridor 3. Traffic analysis assumes 2030 mode of station access is 5% by transit and 20% by walking. Regarding signal timings and lane configurations, all signals were optimized for Build 2030 volumes; no cycle lengths were changed. The future year lane configurations are based on a report by Michael Baker Inc. dated June 6, 2008. 7.2 Traffic Impacts Under Build Condition This station site contains significant potential for development. Proposed traffic impacts could overtax the existing arterial road network. The proposed grid of streets is designed to mitigate these potential traffic impacts. First, the dense grid provides multiple paths for trips within the development, facilitating improved mobility around the station for automobiles and pedestrians. Second, major north-south and east-west routes are set up to provide traffic Technical Memorandum: Carmel Church Station 33

routes parallel to Route 1 and I-95, giving travelers opportunities to bypass incidents or congestion. Future demand for automobile trips on existing streets will require the addition of three new signalized intersections along Route 1. These intersections will be located at key access points and will control vehicle access into and out of the proposed development. No additional improvements to the existing road network are assumed. Figure 7-2 shows the new streets proposed as part of the station area plan, and Table 7-3 provides detailed results of the traffic analysis. Figure 7-2: Proposed Street Infrastructure Improvements Technical Memorandum: Carmel Church Station 34