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Joint Development Agreements Using FTA Funds or FTA-Funded Assets (2021)

Chapter: APPENDIX C. JD MODEL AGREEMENTS

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Suggested Citation:"APPENDIX C. JD MODEL AGREEMENTS." National Academies of Sciences, Engineering, and Medicine. 2021. Joint Development Agreements Using FTA Funds or FTA-Funded Assets. Washington, DC: The National Academies Press. doi: 10.17226/26268.
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20 TCRP LRD 56 specific project(s). These agreements include: letters of intent; exclusive negotiating agreements; memorandum of agreement; and a joint development agreement. These forms all anticipate some form of more definitive follow-on agreement which might ultimately be something like a ground lease, air rights lease or asset sale agreement. Template A-3 is based on WMATA’s form of joint development agreement. A-4 Template Ground Lease Template A-4 is the WMATA standard form of a ground lease. As noted on the first page, particular attention should be paid to provisions highlighted in yellow when drafting an actual ground lease from this template. Some highlighting re- flects blanks to be filled in, but other highlighting reflects provi- sions that may not be advisable to offer in a first draft or that may be highly negotiable. Other notes on the first page include certain assumptions regarding preceding activities that should have occurred before execution of a lease, such as recording any Covenants, Conditions and Reservations (see A-6) in the land records and obtaining FTA concurrence. For the purposes of an air rights type of lease, WMATA’s approach would be to use much of the same form except to change the description of the lease premises in Article 2. A-5 Template Agreement of Purchase and Sale It is important to note that in the past (2002-2016) almost 80% of WMATA’s 18 joint development transactions involved property sales. Although we have used the WMATA Pur- chase and Sale Agreement it should be noted that under their new policies (A-1) WMATA now has a strong preference for ground leasing rather than selling land for Joint Development. The primary reason is by leasing rather than selling, they cre- ate a revenue stream that over time creates an ongoing source of operating revenue for the agency. Additionally, a lease better ensures “satisfactory continuing control” as required by the FTA Guidance. A-6 Template Covenants, Conditions and Reservations (CC&Rs) Every joint development transaction will have certain re- quirements which need to attach to the property rights ulti- mately granted by the lease or sale agreement. Over the years, WMATA has developed a number of these provisions and now has assembled them into one document for reference. These CC&Rs can be used as needed and appropriate for individual transactions. If the joint development only requires one piece of property these provisions could be incorporated directly into the terms of the lease or sale agreement. If the development around a station, for example, involves a number of different parcels and transactions, then the CC&Rs could be recorded in the land records to apply to the entire station area development. APPENDIX C. JD MODEL AGREEMENTS Model agreement forms were developed from Washington Metropolitan Area Transit Authority’s (WMATA) Office of Real Estate and Station Planning Templates,70 and are available on the TRB website (www.trb.org) by searching “TCRP LRD 56”. Based on the documents collected, certain model provisions have been extracted for ease of locating and included in Appen- dix D: Selected Model Provisions. All other agreements, policies and guidelines reviewed for this study are noted in the table in Appendix E: Miscellaneous Transit Agency Joint Development Documents.  WMATA’s joint development agreements were found to be the most comprehensive set of agreements by any of the transit agencies surveyed. Therefore, the forms developed by WMATA are proposed as suggested model agreements. These model agreements were all prepared by WMATA counsel and negoti- ated based on a specific location and project(s) site, in accor- dance with the applicable regulations and jurisdictional law that would apply (D.C., Maryland and Virginia).71  A-1 Template Joint Development Program Guidelines Transit agencies should have an up-to-date joint development policy approved by its governance and made available to the pub- lic and private sectors. WMATA’s policies were updated in May 2020 and are included as a Template. Guidelines should address: Scope of Guidelines; Joint Development Objectives; Solicitation Process; Joint Development Agreements; Role of Agency Board of Directors and Management; and FTA Concurrence.  A-2 Template for Joint Development Solicitation Only 2 solicitation forms were obtained in the survey of transit agencies, WMATA’s standard form of solicitation and WMATA’s solicitation for Huntington Station. Solicitations should include: Description of the site and the properties in- volved; Administrative and contractual information; proposal preparation, format, content and submittal guidance; process for review, evaluation and selection; Agency requirements and conditions. A-3 Template Joint Development Agreement As indicated in Appendix C, transit agencies have various forms and names for joint development agreements which may vary based on level of commitment and details concerning the 70 The Research Team wishes to acknowledge and express its grati- tude to WMATA’s staff including Steve Teitelbaum for their assistance and willingness to share the use of their documents. 71 DISCLAIMER: These documents were all prepared and negoti- ated based on specific requirements in the jurisdictions that were appli- cable to the location where they were used. The model agreements, model provisions and sample agreements contained in Appendix C, Appendix D, or Appendix E should not be used or be further developed without the advice from legal counsel, licensed and familiar with the jurisdictions’ local & state laws and regulations where the project shall reside. 

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In the United States, transit oriented development (TOD) is now recognized as a critical element in the planning, development, and execution of transit projects. Recent legislation has been designed to streamline the approval processes for new transportation projects, focus more on safety, and establish new programs to advance critical freight projects.

The TRB Transit Cooperative Research Program's TCRP Legal Research Digest 56: Joint Development Agreements Using FTA Funds or FTA-Funded Assets aims to clarify the Federal Transit Administration (FTA) assisted joint development process and attempts to separate public perceptions (and misperceptions) about TOD from reality. It is an update to TCRP Legal Research Digest 12:The Zoning and Real Estate Implications of Transit-Oriented Development.

Appendix C incudes sample model agreement forms, developed from Washington Area Transit Authority’s Office of Real Estate and Station Planning Templates.

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