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The Overhead Wire

I think you're basically thinking about an Impact or Linkage fee. (http://en.wikipedia.org/wiki/Impact_fee) In order to be able to build in a development charge that would actually account for the true transportation costs of a certain development, you would need to be able to prove in court (In the US anyway) that this linkage does not constitute a taking. This means providing a "Rational nexus" and "reasonable connection" proving that the fee is appropriate and does not constitute an unfair reduction in the value of the property.

But you would need to prove through research or otherwise that urban development has less impact, what parts of the city are subject to how much in fees and so on. So if you're building buildings that benefit from the expenditures but don't pay as much as buildings that don't, you'll have to have an air tight legal case as to why the building doesn't have to pay when the house does. In some cases I'm guessing this will ultimately be reduced to a legally contrived value judgement on whether Suburban life is desirable. I think it would be possible to do, but could be a hard road to hoe.

jared

There's a great book called Perverse Cities by Pamela Blais that discusses how current development fee structures encourage sprawl, which is a great read. Everything from roads to telephone land lines. Lots of Toronto examples too. Recommended read.

Paul K McGregor

I know about a project in Contra Costa County that used impact fees to fund the start-up of new bus service. Each residential unit was assessed a certain fee per unit which was used as a fund to operate a new bus service. As the fees ran down, the transit agency would then have to determine whether there was enough success for the route to take the funding over completely or discontinue the service. The decision that was made was to continue the route.

Matt

A fine idea, but difficult in practice. ABQ has tried it, with some help from Chris Nelson. Doing so made development on the 'West Side' of town substantially more expensive.

"The system on the books now, for instance, calls for full impact fees of $37,000 for a drive-through fast-food restaurant on the southwest mesa. It would cost $455 if it’s being built in the university area or Northeast Heights"
-Albuquerque Journal, November 20, 2012

Needless to say, this was highly disruptive, as full cost accounting of impacts effectively halted development west of the river. The city got taken to court. City council members HATE to go to court. So they voted to change the impact fee back to the original 'location neutral' system.

New Mexico is both poor and frugal, full of people who care deeply about how their money is spent--they don't like paying taxes, and so they want to make sure taxes collected are spent well.

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