Value capture beyond municipalities: transit-oriented development and inter-city passenger rail investment in China’s Pearl River Delta

Abstract

Existing research rarely systematically reviews how China has funded or will fund expanding transit systems. We argue that fiscal regulations have shaped how China’s municipal governments plan for and invest in passenger rail services and land development around stations, and that policy reforms are necessary to bring successful transit-oriented development and transit operation for China’s next round of urbanization. Using Pearl River Delta (PRD) as the study case, we review the planning and funding processes for an inter-city passenger rail services, and reveal how a new funding and planning framework has been developed out of pre-existing organizational and legal constraints. The central piece of this innovation is a value capture framework beyond municipal boundaries, which tighten the connection between transit funding and transit-oriented development. The PRD experience has implications for other megaregions in China.