Comprehensive Evaluation of Transit Oriented Development Benefits

Transit-Oriented Development (TOD) refers to communities with high quality public transit services, good walkability, and compact, mixed land use. This allows people to choose the best option for each trip: walking and cycling for local errands, convenient and comfortable public transit for travel along major urban corridors, and automobile travel to more dispersed destinations. People who live and work in such communities tend to own fewer vehicles, drive less, and rely more on alternative modes.

6 minute read

June 7, 2009, 5:14 PM PDT

By Todd Litman

Transit-Oriented Development (TOD) refers to communities with high quality public transit services, good walkability, and compact, mixed land use. This allows people to choose the best option for each trip: walking and cycling for local errands, convenient and comfortable public transit for travel along major urban corridors, and automobile travel to more dispersed destinations. People who live and work in such communities tend to own fewer vehicles, drive less, and rely more on alternative modes.

The greatest mode shift is not from automobile to public transit, it is to walking, as illustrated in the figure below. In total, residents of neighborhoods with good transit and mixed land use drive less than half as much on average as residents elsewhere.

TOD Impacts On Mode Split in Portland, Oregon (Ohland and Poticha 2006)

Portland Mode Split 

People who live in transit-oriented developments drive less and rely more on alternative modes. "Daily VMT" indicates average daily vehicle miles traveled per capita.


This provides large benefits:  

·         Congestion reduction (30-50% reductions in per capita annual congestion delay are typical between transit-oriented cities and comparable size automobile-oriented cities). 

·         Road and parking facility cost savings (worth hundreds of dollars annually per capita). 

·         Consumer savings and improved affordability (often totaling thousands of dollars annual per household). 

·         Improved safety (residents of transit-oriented communities have about a quarter of the per-capita traffic fatality rate as residents of automobile-dependent sprawl, taking into account all traffic deaths, including pedestrians and transit passengers). 

·         Improved mobility options for non-drivers (non-drivers benefit not only from improved public transit service, but also from improved walking and cycling conditions and more compact and mixed land use).  

·         Improved public fitness and health (transit users are four times as likely to achieve the target of 20 minutes or more of walking per day as people who do not use transit on a particular day).  

·         Increased local property values and household wealth (improved accessibility and transportation cost savings tend to be capitalized in higher land values, which appreciates over time).  

·         Energy conservation and emission reductions (residents of transit-oriented communities tend to consume 20-40% less transportation energy than they would in more automobile dependent communities). 

·         More dollars circulating in the local economy (expenditures on vehicles and fuel provide less employment and business activity than expenditures on other consumer goods, and much less than expenditures on transit service). 


These benefits are so numerous and diverse that many people have difficulty understanding the total value provided by transit-oriented development. Critics often argue that transit costs are not justified by a particular benefit, such as congestion reductions, emission reductions or consumer savings. They are correct – considered individually these benefits do not necessarily justify major transit investments - it is the sum of all benefits that justifies high quality public transit and transit-oriented development.

A good example is Samuel Staley's recent column, Ridership no factor in transit-oriented development, which implies that transit oriented development is misguided because, "actual transit ridership has little relationship to the private investment around transit stations".  He argues that consumers just want more compact, urban development, so investing in high quality public transit is unnecessary and wasteful.  

This is an interesting point. Perhaps we just need new urbanism without better transit service or stations. I suspect he is wrong for several reasons. First, high quality public transit is essential for compact urban development because it reduces vehicle traffic and parking demand. Even if transit represents a relatively small portion of total regional trips, it typically represents 40-60% of peak-period trips to major commercial centers, allowing those centers to grow in residents and jobs given existing road capacity. It is simply not possible to create large new urbanist centers with high rates of vehicle ownership and use.

Second, although only a small portion of the reduced automobile mileage shifts to public transit, these trips are particularly important, such as regional commutes. The availability of high quality public transit for such trips allows households to reduce their vehicle ownership, which creates the cascade of benefits: reduced fixed vehicle costs which provides direct savings and encourages people to minimize driving; reduced parking requirements, which allows more compact development and allows more trips to be made by walking; increased walking, cycling and public transit travel make these modes safer to use and more socially acceptable, which builds public support for more investments in alternative modes.  

Third, many factors influence the degree to which investment occurs around new transit stations, including the demand, the type, and phasing of development. Local transit ridership is likely to continue growing over time as TODs mature.

Staley shows additional misunderstanding about the roles of transit and transit-oriented development when he states, "Transit follows a fixed-route to specific destinations based on a set schedule. Rail or bus transit is thus frequently an inferior alternative to the flexibility and mobility provided by the customized travel afforded by the automobile."  Transit may be inferior for some trips but is superior others: it is sometimes faster, cheaper and less stressful than driving. The beauty of TOD is that individual travelers can choose the best mode for each trip, which is not possible in automobile-dependent communities.  

That fixed-route transit serves a relatively small portion of total regional area is irrelevant, the key indicator is the portion of total activities that are served. Well designed transit systems insure that many common destinations are located within TODs, and this grows over time as more development occurs within convenient walking distance of transit stations. For example, in a typical city TOD may cover only 10% of the urbanized area but serve 20-40% of homes, 40-60% of schools and jobs, and 60-80% of major sports and cultural centers. The result is a high degree of accessibility.

Various demographic and economic trends (aging population, rising future fuel prices, increasing congestion, changing consumer preferences, increasing health and environmental concerns) are increasing demand for alternative modes and urban living.

I know from personal experience the value of transit-oriented development. Here in Victoria, British Columbia, the nicest neighborhood centers (Oak Bay Village, Cook Street Village, Fernwood, Esquimalt, Downtown Victoria) all began as streetcar station areas a century ago. We still enjoy the legacy of these systems in the form of compact, mixed, walkable activity centers. The result is good accessibility for drivers and non-drivers, increased affordability and a high quality of life in these urban neighborhoods, which increases their property values. Everybody can benefit if communities build more TODs so they become affordable to everybody who wants and needs to live in such neighborhoods.


For more information:  

Belden, Russonello and Stewart (2004), American Community Survey, National Association of Realtors ( and Smart Growth America (

Todd Litman (2004), Rail Transit In America: Comprehensive Evaluation of Benefits, VTPI (; at 

Todd Litman (2005), Evaluating Rail Transit Criticism, Victoria Transport Policy Institute (; at 

Todd Litman (2006), Smart Congestion Reductions II: Reevaluating The Role Of Public Transit For Improving Urban Transportation, VTPI (; at

Todd Litman (2005), Evaluating Public Transit Benefits and Costs, VTPI (; at 

Gloria Ohland and Shelley Poticha (2006), Street Smart: Streetcars and Cities in the Twentry-First Century, Reconnecting America ( 

Jeffery J. Smith and Thomas A. Gihring (2004), Financing Transit Systems Through Value Capture: An Annotated Bibliography, Geonomy Society (; at; originally published as "Financing Transit Systems Through Value Capture: An Annotated Bibliography," American Journal of Economics and Sociology, Volume 65, Issue 3, July 2006, pp. 751-786.   


Todd Litman

Todd Litman is founder and executive director of the Victoria Transport Policy Institute, an independent research organization dedicated to developing innovative solutions to transport problems. His work helps to expand the range of impacts and options considered in transportation decision-making, improve evaluation methods, and make specialized technical concepts accessible to a larger audience. His research is used worldwide in transport planning and policy analysis.

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