Diridon Station Infrastructure Funding Projections

San Jose, California

The City of San Jose commissioned BAE Urban Economics to prepare a financial cash flow model to project the potential revenues that could be generated from new development in the Diridon Station Area Plan (DSAP) area. 

To facilitate the analysis, BAE developed the Diridon Infrastructure Financing Revenue Model (DIFR Model) to project the amount of revenue that could be generated within the DSAP area from incremental increases in property tax and property tax in-lieu of motor vehicle license fees (ILVLF), through establishment of an Enhanced Infrastructure Financing District (EIFD), or a similar mechanism that would need to be approved through special State legislation.  The DIFR Model also includes a component that projects the potential revenue from establishing a Mello-Roos Community Facilities District (CFD) within the DSAP area.

After constructing the DIFR Model, BAE used the model to generate DSAP infrastructure funding revenue projections under several different scenarios through build-out of the DSAP area.  The scenarios were meant to illustrate the range of revenues for infrastructure funding purposes that might be generated within the DSAP area, under several different sets of assumptions regarding participation of different agencies in the DSAP financing plan and their level of involvement, as indicated by contribution of various funds to the effort.  As the final component of the analysis, BAE delivered the DIFR model and instructed City Staff on how to update the inputs and assumptions in order to ensure the usefulness of the model as a long-term resource for the City.