Capturing Land Value Increment to Finance Infrastructure Investment—Possibilities for South Africa

In the globalisation age, cities are the drivers of economic growth. However, sustainable economic growth demands considerable investment in infrastructure. South African cities face a triple challenge of eradicating historical infrastructure backlogs inherited from the Apartheid era, servicing and maintaining existing infrastructure and providing new infrastructure to stimulate economic growth. In the South African context, the provision of municipal infrastructure plays a critical role in eradicating sociospatial inequalities as part of an overall poverty reduction strategy. This places a huge burden on local governments in South Africa in particular as they face capacity constraints and challenges in terms of raising sufficient own revenue in order to finance infrastructure projects. This paper argues that in light of the South African government’s current infrastructure drive and the significant amount of public resources being spent on transport infrastructure upgrades, it is an opportune time to consider the impact of transport infrastructure investment in particular on land value and how this value can be captured to finance the provision of infrastructure at local level. The paper cautions though that any programme aimed at capturing betterment needs to be based on sound research and needs to take cognisance of the legislative, policy and economic context in South Africa.     

Allocation mechanisms in public provision of transport and communication infrastructure

This study explores the allocation mechanisms in the public provision of interregional transport and communication infrastructure in Sweden. The logistics of the flow of infrastructure investments from the government budget is examined. The purpose is to consider how the demand for infrastructure investment is estimated by public agencies, how judgments are made on governmental expenditure policy, and what determines the spatial distribution of infrastructure investment. The analysis is carried out along four main lines; demand for infrastructure services, political intentions and goals, the modal composition of investments for transport and communication, and the spatial distribution of infrastructure. The discussion considers functional, spatial, and temporal consistency aspects in the public provision of infrastructure.     

A New Land Use in Downtown: How Cities are Dealing With Telecom Hotels

Abstract Telecommunications infrastructure is growing in importance across the United States. In the past, this infrastructure was largely invisible. Today, however, telecom hotels have emerged as a visible form of downtown infrastructure. This study explores the reaction of communities to the development of telecom hotels in downtowns. A few cities have formulated formal policy responses to telecom hotel development in downtown areas. The approaches vary from tax incentives to regulatory limitations. The findings indicate that communities need to plan for growth in telecommunications infrastructure.     

Towards sustainable urban water management: A critical reassessment

Within the literature, concerns have been raised that centralised urban water systems are maladapted to challenges associated with climate change, population growth and other socio-economic and environmental strains. This paper provides a critical assessment of the discourse that surrounds emerging approaches to urban water management and infrastructure provision. As such, ‘sustainable urban water management’ (SUWM) concepts are scrutinized to highlight the limitations and strengths in the current lines of argument and point towards unaddressed complexities in the transformational agendas advocated by SUWM proponents. Taking an explicit infrastructure view, it is shown that the specific context of the urban water sector means that changes to infrastructure systems occur as an incremental hybridisation process. This process is driven by a range of factors including lock-in effects of legacy solutions, normative values and vested interests of agents, cost and performance certainty and perceptions of risk. Different views of these factors help explain why transformational agendas have not achieved the change SUWM proponents call for and point to the need for a critical reassessment of the system effects and economics of alternative service provision models.     

Urban sprawl and municipal budgets in Spain: A dynamic panel data analysis

Urban sprawl has recently become a matter of concern throughout Europe, but it is in southern countries where its environmental and economic impact has been most severe. This low‐density, spatially expansive urban development pattern can have a highly marked impact on municipal budgets. Thus, local governments may see sprawl as a potential source of finance, in terms of building‐associated revenues and increased transfers from upper tiers of government. At the same time, sprawl leads to increased levels of expenditure, as it may raise the provision costs of certain local public goods and requires greater investment in extending basic infrastructure for new urban development. What, therefore, is the net fiscal impact of urban sprawl? Do local governments consider the long‐run net fiscal impact of new urban growth or do they simply focus on its short‐term benefits, ignoring future development costs? This paper addresses these questions by analysing the dynamic relationship between urban sprawl and local budget variables. To do so, we estimate a panel vector autoregressive model using data for 4,000 Spanish municipalities for the period 1994–2005. Computed generalized impulse response functions show: (i) that sprawl considerably increases demand for new infrastructure; (ii) that the capital deficit generated by this new infrastructure is covered in the main by intergovernmental transfers and, to a lesser extent, by revenues linked to the real estate cycle; and (iii) that sprawl leads to a short‐term current surplus, as the increase in current revenues offsets the increase in current expenditures due to public service provision for new developments. Overall, these findings point to a moral hazard problem for local governments in which inordinate intergovernmental transfers and development revenues encourage excessive urban sprawl.     

Urban development policies for the provision of utility infrastructure: a case study of Dhaka,Bangladesh

This research aims to analyse three urban development policies relevant to the utility infrastructure provision in Dhaka, Bangladesh for improving the environment. Available relevant literature, site survey data, and stakeholder's opinion derived from semi-structured interviews were utilised for qualitative analysis. The results reveal that providing the utility infrastructure in the existing urbanised areas is possible by service upgrading and incremental development. Nevertheless, though implementation is politically and financially challenging, this research suggests that the new urban policy with the utility infrastructure provision prior to development is more effective.     

中国特大城市数字城市建设初探

特大城市具有人口数量大、经济发展水平高、人口素质高及信息化程度高的特点。在数字城市投资和建设中，特大城市在信息基础设施、空间数据基础设施、应用和服务市场、资金、信息化水平、人口素质等方面有着诸多有利条件。在数字城市投资和建设中，特大城市需要重视并解决基础设施、数据中心、经营管理、应用结构及投资与效益等方面的问题。     

Club Goods and Local Government

Problem: Private approaches to urban service provision are becoming more popular. Some argue these approaches are more efficient and more democratic than government provision because they are voluntary. While these club approaches can shift the burden of infrastructure finance to direct groups of users, they can also fragment urban service delivery and justify unevenness in service quality across the city.

Purpose: This article explores examples of club goods, that is, common interest developments (CIDS) for housing, business improvement districts (BIDs) for commercial areas, and economic development zones (EDZs) for commercial and industrial areas, and assesses their implications for local government. Emphasis is given to how clubs internalize benefits to members of the club but shed externalities onto the broader local government system. A critical governance concern is the impact on the long-term ability of local government to coordinate across disparate elements and interests in the community.

Methods: I discuss three types of clubs ranging from totally private common interest developments (home owners associations), to partially private business improvement districts, to totally public economic development zones. These club types are analyzed in terms of economic benefits, externalities, governance structure, and broader concerns with equity and sustainability.

Results and conclusions: Club good approaches to urban infrastructure delivery enhance private investment and reduce costs to cities, but they also shed externalities onto the broader city. Although these clubs are often private associations, this article shows how they are critically supported by government, beyond the property rights requirement assumed by most theorists. A further concern is that club approaches may undermine support for equity and redistribution at the broader city level.

Takeaway for practice: Local governments are under pressure to provide public goods efficiently and engage private voluntary approaches whenever possible. The efficiency and popularity of club approaches derives in part from their ability to capture the benefits of increased investment for internal benefit. However, local government managers also must manage diversity and build public support for investment to ensure equity across the urban territory. Balancing the benefits of club goods with the need for broader urban integration is a key challenge for planners and urban managers.

Research support: None.     

对非经营性政府投资项目投资控制的思考

随着我国经济持续快速的发展,政府不断加大对基础设施和公益性非经营性项目的投资力度,然而我国的非经营性政府投资项目普遍存在着投资效益低下,资金得不到有效的控制,“三超”现象普遍存在。究其原因既有体制方面的,也有管理方面的。因此必须采取有效的措施加以解决,以提高资金使用效率,确保政府投资项目投资得到有效的控制。     

BUDGETING FOR PUBLIC CAPITAL

ABSTRACT: City governments provide much of the economic and social capital comprising urban infrastructure. A prevailing idea is that public managers should and can budget rationally and systematically for the provision of infrastructure. This view frequently neglects consideration of the reactive, ad hoc nature of infrastructure investment in cities. Common approaches to the notion of rational capital budgeting are discussed and a reinterpretation of how city governments supply infrastructure is presented.     

城市基础设施的投资策略研究

城市基础设施投资决策往往不是仅仅指对于某一个项目的决策 ,许多项目之间是互相关联的 ,而且与经济、社会其他领域有极大的关联。因而 ,首先应该明确城市基础设施投资的整体策略 ,包括基础设施的总体投资水平、基础设施系统内部各专业的投资比例与变化特征、在投资中采用什么样的市场导向政策以及为保证策略实施需要配套的措施 ,这些都是基础设施投资策略中的基本问题。本文旨在从城市规划与城市发展的角度 ,对这些基本问题进行一些基础性的分析研究 ,希望能为城市基础设施投资策略的选择提供参考。     

我国城乡基础设施建设投资情况对比分析

对全国历年城市市政公用设施固定资产投资情况、城市道路和桥梁情况、乡公用设施情况、村庄公用设施建设和投资情况进行了实证比较,由此发现：城市市政公用设施固定资产投资规模和城市市政公用设施的实物存量,近年来都呈现明显增加的态势;乡级道路桥梁的实物存量呈现下降态势;村庄公用设施的资金投入呈现增加态势,但村庄道路桥梁的实物存量变化不大。结论是：我国基础设施建设和资金投入的城乡二元特征明显,须对农村基础设施建设加大投入力度,并提升资金使用效率。     

电网建设创新探索

为了满足国民经济的高速发展,近年来,基础设施建设投入在成倍增长,电网建设作为基础设施的重要组成部分,投责也在逐年加码,特别是”十二五”期间,将成几何级数增长,达到历史的顶峰,如此大规模的投入,新老问题扎堆,必须转变观念,勇于探索实践,创新思路来适应电网建设的大潮,实现电网建设跨越式的发展.     

Changing from intermittent to continuous water supply and its influence on service level benchmarks: a case study in the demonstration zone of Nagpur,India

A dearth in infrastructure and operations significantly reduces the expected benefits of safe drinking water provision. Intermittent water supplies are characterized by inefficient demand and supply management owing to operational inadequacies eventually causing physical deterioration of infrastructure and inconvenience to consumers, resulting in consumer dissatisfaction. Conversion from intermittent to continuous water supply was undertaken in a demonstration zone of Nagpur, India, with a population of about 150,000 people. Data related to the infrastructural, operational, managerial and financial capabilities were used to determine service level benchmarks (SLBs) — pre- and post-intervention — to quantify the improvement due to continuous water supply interventions. The post-intervention data analysis clearly indicated substantial improvement in post-intervention SLBs, consequently paving the way for the conversion of the water supply of the entire city to continuous mode.     

Regional consortia and transaction costs for sanitation services in Brazil

Studies on public cooperation usually focus on its impact on the service costs experienced by service providers. However, engagement in public cooperation in service provision often seeks other outcomes, like service coverage (measured by the population served) rather than simply minimizing service expenditure. Moreover, public cooperation by local governments, as either ‘providers’ or owners, generates transaction costs arising from negotiation, monitoring, agency costs and the enforcement of cooperative agreements. However, to date, little empirical effort has been directed at determining the impact of transaction costs on service provision owners and service outcomes. This paper addresses this gap in the empirical literature by examining the relationship between cooperative agreements between Brazilian municipalities for water and wastewater provision and service coverage in the light of transaction costs. We find that transaction costs are higher for cooperative providers due primarily to low service coverage levels, especially in sewage services that demand high investment in assets with high specificity. However, lower expenditures may occur after initial up-front investment.     

The productivity and supply of urban infrastructures

The paper examines the productivity and supply of urban infrastructure capital using a panel data set of 85 West German cities. A simple theoretical framework is used to infer the impact of infrastructure services on private production cost. Assuming local firms to operate under perfect market conditions we derive an optimal local infrastructure supply rule and an optimal business capital tax rate. The empirical part of the paper proceeds by a two step procedure. In a first step we examine the productivity of urban infrastructure service provision by evaluating the cost reductions that are associated with the supply of infrastructures. In a second step, the adjustment of the urban infrastructure capital stock and the urban business tax rate is estimated, incorporating the estimated monetary productivity effects as well as some simple inter-jurisdictional competition variables into the empirical model.The paper is a revised and abridged version of a paper presented at the 33rd European Congress of the Regional Science Association, Moscow, August 1993. I gratefully acknowledge suggestions for improvement by Klaus Conrad and two anonymous referees.     

Payment and audit mechanisms for non private‐funded PPP‐based infrastructure maintenance projects

The introduction of a non private‐funded public–private partnerships (PPP) approach to the maintenance and operation of infrastructure facilities necessitates an equitable performance standard, a sensible penalty mechanism and a credible auditing system. Yet, with limited research on this type of scheme, it is not clear whether the payment and audit mechanisms can adequately gauge the performance of private partners and truly reflect the quality of service provided in their payment. The question is whether the reliability of the payment reduction and auditing mechanisms pertinent to the non‐private funded PPP infrastructure maintenance can be systematically verified. With reference to a case study in Hong Kong, field data have been collected and tested according to the sensitivity analysis and level of confidence. The results indicate that the level of payment reduction due to poor performance is fair and the audit frequency is adequate to reflect the overall performance of the service provider. The approaches adopted in this research should provide an objective basis for public and private partners to formulate a mutually acceptable and effective mechanism for non private‐funded PPP infrastructure maintenance contracts.     

云南省基础设施投资对新型城镇化高质量发展的影响

为分析云南省不同类型的基础设施投资对新型城镇化发展水平的影响,采用熵值法测算云南省2007~2020 年的新型城镇化发展质量水平。在此基础上,运用多元线性回归模型分析研究期不同类型的基础设施投入对新型城镇化发展质量的影响。研究显示,云南省不同类型基础设施投资对新型城镇化发展质量水平的影响程度差异较大,基础设施投资结构性失衡。建议政府科学规划城镇基础设施投资结构,加大教育投资强度、完善社会保障设施的规划,完善交通基础设施建设。     

环境基础设施多元化投资结构调整优化研究

环境基础设施是防治污染、改善环境质量和提高人们生活水平的重要支撑载体。为促进环境基础设施投资的市场化,缩小政府对其投资比例,采用实证与理论相结合的方法,对环境基础设施投资现状存在的问题进行研究并提出对策建议。在分析环境基础设施投资现状的基础上,总结和描述阻碍社会资本投资环境基础设施存在的投资建设体制不健全、投资建设信息不对称、投资建设放权不充分、投资建设观念不深入等问题,对问题产生的原因进行分析。并从完善投资市场机制、建立投资中介服务、明确投资权利与风险、执行投资监督与透明公开化等方面提出相应对策建议。     

Inequities in the broadband revolution

Residential broadband options such as cable and digital subscriber lines are growing in popularity. However, evidence suggests that urban areas are receiving the majority of infrastructure investment, thereby leaving many rural locations with few options for broadband access. With access to telecommunication infrastructure becoming an increasingly important component to local economic development, issues of infrastructure equity are significant. This paper explores telecommunication equity and its effect on economic development by addressing the impact of geography on infrastructure investment and growth. A comprehensive database of broadband service providers and data from the Ecom-Ohio project (http://www.ecom-ohio.org), are used to explore broadband access options in the state of Ohio by examining the characteristics of market demand that are driving cable and digital subscriber line infrastructure investment. In addition, this paper develops an explanatory framework for identifying key market characteristics indicative of demand for residential broadband services through the use of statistical models and a geographic information system. Results suggest that income, education, age, location, and competition from alternative broadband platforms influence digital subscriber line infrastructure investment. Received: November 2001/Accepted: September 2002