Planning Freight-Efficient Land Uses: Methodology, Strategies, and Tools (2022)

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16 The FELU program is expected to list the actions needed to systematically foster FELUs to increase the efficiency of supply chains and freight activity. In most cases, these actions can be undertaken within the parameters previously set by a jurisdiction’s long-term land-use plan. FELU programs could be used by the majority of land-use agencies in the country, to move their efforts toward FELUs. Over time, once land-use agencies have experience with FELU concepts, principles, programs, and their benefits, they could consider other means to foster FELUs, such as the development of local FELU programs. 3.1 FELU Strategy The FELU strategy outlined is based on the recognition that achieving FELUs is a complex endeavor. The most effective approaches will likely involve multiple initiatives, working in combi- nation, to address different facets of the issue at hand. Such comprehensive use of FELU initiatives will increase the efficiency of supply chains and foster the smooth integration of freight activity into the fabric of communities and the economy. The Guide discusses the use of complementary initiatives in two ways. The first entails the use of combinations of land-use initiatives, of the kind that are within the power of land-use agen- cies. These combinations of initiatives are useful in cases where the resulting decisions do not create major transportation externalities that could provoke community opposition. Figure 3 shows an example of potential combinations of initiatives as a line connecting the initiatives from different groups. The second way to combine initiatives is to take advantage of both land-use and transportation initiatives. Tapping into the arsenal of initiatives available to land-use and transportation agencies gives these joint efforts power because they could complement each other as follows: • Land-use initiatives can be used to facilitate or enact changes in zoning, buildings, sites, and the nature of the activities that could be performed at the site. • Transportation initiatives could mitigate or eliminate the negative effects on local communities that could jeopardize the implementation of the land-use initiatives that foster FELUs. The holistic use of land-use and transportation initiatives will enable land-use planners to exploit the synergies and complementarities among land-use and transportation initiatives, increasing the effectiveness of the entire effort. By using this holistic strategy, community con- cerns about the noise produced at an urban distribution center could be addressed by requiring the operator of the urban distribution center to use electric vehicles and low-noise equipment to bring supplies to the urban distribution center, and then use electric cargo bikes to make deliver- ies. Essentially, FELU initiatives are assisted by transportation initiatives aimed at facilitating the implementation of the land-use initiatives, creating a virtuous circle leading to FELUs. C H A P T E R 3 Development of a FELU Program Trans- portation initiatives to address issues that could block FELU efforts Land-use initiatives aimed at fostering FELUs

Development of a FELU Program 17   This Guide takes advantage of NCFRP Report 33, which produced a comprehensive review of potential initiatives to address freight issues. The original NCFRP Report 33’s initiatives were reorganized as part of a continuum of initiatives together with the land-use initiatives developed in this Guide. A schematic of the set of initiatives is shown in Figure 4. As shown in the figure, the center pillar of the effort must be the process of stakeholder engagement, without which implementing effective FELU initiatives is difficult. The land-use initiatives are categorized as follows: Planning and Programming; Zoning, Sites, and Buildings; Stakeholder Engagement; Infrastructure Management; and Parking and Loading Areas Management. The transportation initiatives are divided into the following categories: Infra- structure Management; Parking and Loading Areas Management; Vehicle-Related Initiatives; Traffic Management; Pricing, Incentives, and Taxation, Logistics Management; and Freight Demand Management. Some initiatives were labeled joint initiatives because they require the involvement of both land-use and transportation agencies. These joint initiatives include Infra- structure Management and Parking and Loading Areas Management. To ensure that the private sector—developers, builders, freight carriers, shippers, receivers, and those involved in supply chains—undertake the necessary actions to foster FELUs, land-use and transportation agencies could use conditional use requirements for approval of a develop- ment, and Traffic Impact Analyses (TIAs) to ensure that the impacts of proposed developments are fully acknowledged and mitigated. These regulatory and enforcement instruments, widely used across the country, provide a mechanism to ensure that any issues identified during the approval processes at land-use and transportation agencies are fully addressed. 3.2 FELU Urban-to-Rural Transect Integration is key to achieving FELUs, that is, finding ways to seamlessly embed the freight activity generated by the local economy into the fabric of rural, suburban, and urban commu- nities. With this integration in mind, the research team built the transect concept to illustrate where the various FIS and the supporting logistics activities should be located. The team created the FELU transect. See Figure 5. Figure 3. Examples of complementary land-use initiatives.

18 Planning Freight-Efficient Land Uses: Methodology, Strategies, and Tools Figure 4. Land-use and transportation initiatives.

Development of a FELU Program 19   Figure 5 shows (1) typical (observed) locations of key FIS, households, and the SIS as a whole; and (2) the suggested locations of the logistics facilities that serve these establishments. The FIS—which represent a particular industry sector or group of industry sectors—have been sorted in descending order of the freight trip generation (FTG), while the logistics facilities have been sorted in descending order of size. In addition, gradient shading from darker (high density) to lighter (low density) symbolizes the density of establishments for a particular sector or group of sectors. As suggested in Figure 5, the largest density of establishments typically takes place in city centers and the areas surrounding them. This is particularly the case for Retail Trade, Accommodation and Food Services, SIS, as well as population density (taken into account because of internet pur- chases). This pattern of locations has major implications because of the importance of these sectors as generators of freight activity; Retail Trade is estimated to produce between 30% to 40% of the freight activity in metro areas, Accommodation and Food Services another 10% to 20%, and SIS another 5% to 10% of the commercial freight traffic. (On top of these numbers, one must also con- sider the internet deliveries to households.) The combined effects of high establishment densities at city centers and large FTGs lead to a situation where freight activity reaches its highest values at, or near, city centers. City centers also happen to be the parts of metropolitan areas with the highest levels of congestion, and the most difficult access. As a result, to achieve FELUs, it is crucial to foster the development of urban distribution centers to reduce the physical separation between the sources of the supplies needed by these establishments, and the establishments themselves. Doing so would reduce the freight VMT generated, leading to major reductions in the externalities that Source: (Adapted from Center for Applied Transect Studies 2019) Figure 5. FELU urban-to-rural transect.

20 Planning Freight-Efficient Land Uses: Methodology, Strategies, and Tools impact local communities. These urban distribution centers are bound to play an important role as the local hubs for internet deliveries to households. The next two largest generators of freight activity are light and heavy manufacturing. In terms of location, these exhibit different patterns. Heavy manufacturing—for historical reasons, regu- lations, or by necessity—tends to be close to major transportation facilities. In contrast, light manufacturing, by virtue of its smaller scale and lesser externalities, tends to be spread out in urban and metropolitan areas. Another important difference is related to the nature of the inter- connection of manufacturing with other establishments. In the case of heavy manufacturing, these firms tend to rely on shipments from either freight gateways, other large manufacturers, or regional distribution centers. In contrast, light manufacturing primarily deals with metro- politan distribution centers, and large manufacturers in the region. As a result, it is not possible to treat manufacturing as a single homogenous group. While heavy manufacturing should be located near freight gateways, regional distribution centers, their local clients, and the work- force; light manufacturing’s ideal locations, from the standpoint of FELU, may be near metro- politan distribution centers, other manufacturers, their local clients, and their employees. These logistics facilities deserve discussion: Freight Gateways. These are the points of entry where the supplies enter and leave the study area. In some cases, these gateways are specific facilities such as marine ports, airports, or inter- modal terminals. However, more often than not, interstate highways also play a role as freight gateways, particularly in cases where trucking is the sole major player. Freight gateways are typi- cally located either near the urban core, which is typically the case of the marine ports associated with the birth of cities, or at the outskirts of the metro area. Notwithstanding their importance in terms of the volumes of cargo they handle, the FTG at freight gateways is relatively small because of the large shipment sizes. Freight Gateways’ Auxiliary Facilities. These auxiliary facilities complement the gateways’ operations. Examples include container yards that store empty containers until they are needed at marine ports, intermodal terminals, fuel depots, and maintenance and repair facilities, among others. To the extent possible, these auxiliary facilities should be located near the gateways they serve to avoid unnecessary travel that could negatively impact the surrounding communities. Regional Distribution Centers. These facilities focus on the distribution of supplies over large regions, typically to satisfy the needs of metropolitan distribution centers, large manufacturers, and other large consumers. These regional distribution centers are typically used by national retailers and manufacturers to distribute supplies to smaller customers. The ideal locations for regional distribution centers are at the fringe of suburban areas where they could have easy access to interstate highways and intermodal facilities, and to a suitable workforce. Metropolitan Distribution Centers. The primary function of these facilities is to distribute supplies within a metropolitan region, as well as reverse logistics. Their customers include retailers, small manufacturers, and urban distribution centers. Taking into account ease of access to their suppliers, and to their customers, the ideal locations for metropolitan distribution centers are the suburban-urban spaces. Urban Distribution Centers. These smaller facilities, increasingly being used thanks to e-commerce, focus on the distribution of consumer products that must be delivered within a short delivery window after the order is placed. With the surging on-demand economy, and the expectations of deliveries within 30 to 60 minutes of the order being placed, urban distribution centers are becoming a fixture in American cities. The smallest versions of the urban distribution centers are sometimes referred to as “mini-distribution centers.” To fulfill their mission, urban distribution centers should be located as close as possible to the urban core.

Development of a FELU Program 21   3.3 Suggested Steps to Produce a FELU Program The overall process to develop a FELU program is outlined in Figure 6. There are four major steps intended to provide a solid understanding of the chief features of the local economy, freight activity, and supply chain patterns in the area; develop an understanding of the issues to be addressed and the opportunities that could be exploited; obtain a general idea about how the prevailing economic and technological trends may impact land-use patterns and freight activity; identify the most effective FELU initiatives; and engage stakeholders to determine the way forward. These regulatory instruments, widely used around the country, provide a legal mech- anism to ensure that the issues identified during the approval processes—those undertaken by land-use and transportation agencies—are fully addressed. As indicated the figure, stakeholder engagement is intended to permeate the entire process of the FELU program development. Additional details are provided next. 3.3.1 Understanding Local Conditions For a FELU program to fulfill its promise, it must be based on a sound assessment of local conditions, in terms of land-use patterns, and the geographic distribution of economic activi- ties, particularly in the FIS of the economy; the associated supply chains and the resulting freight activity; and the issues identified as problematic by both the communities and the private sector. Engaging the private sector is key to gaining qualitative knowledge about the supply chain activity and the challenges that local supply chain stakeholders face. Gaining solid knowledge of local conditions is indispensable. These local conditions can change over time and the production of a FELU plan should consider further changes and be flexible to adapt to future local conditions. 3.3.2 Identification of Priorities and Opportunities The development of a FELU program should start with a clear identification of the freight issues involved, which will determine the priorities for action as well as the opportunities that could be exploited on behalf of the community and the local economies. The identification of priorities will benefit from efforts to understand local conditions. The fundamental questions for identifying freight issues are (1) What are the most pressing freight issues that impact local communities and the private sector? and (2) What could land-use planning and regulations do to help address the issues identified? Equally important is identifying potential opportunities that could be involved, such as repurposing land that becomes available. In this era of economic and technological transformations that could impact local commu- nities in multiple ways, it is important to consider the impacts these trends could produce at the local level. The main intent is to ensure that land-use agencies are aware of not only the trends that could impact their jurisdictions, but also any potential opportunities that could be exploited for the benefit of the community. A relatively easy way to be informed is to participate in the webinars organized by professional organizations such as the American Planning Association (APA), federal agencies such as the FHWA, and research universities. The joint identification of priorities for action and potential opportunities provides a solid platform for the next steps. Identification of Priorities and Opportunities Understanding Local Conditions Selection of Most Effective FELU Initiatives (land-use / transportation) Stakeholder Engagement Figure 6. Steps to produce a FELU program.

22 Planning Freight-Efficient Land Uses: Methodology, Strategies, and Tools 3.3.3 Identification and Selection of FELU and Transportation Initiatives The main objective of this task is to identify the most appropriate set of initiatives to accom- plish the objectives of the FELU program. A tenet of this Guide is that the use of complemen- tary land-use initiatives, and complementary land-use and transportation initiatives, could be impactful because of the synergies between the initiatives. To facilitate decision-making, the team characterized both land-use and transportation initiatives in terms of their charac- teristics and anticipated performance in fostering FELUs. These descriptors were codified into a dynamic webpage—the Initiative Selector—that, in response to the issues described by the user, identifies potential initiatives and combinations of initiatives that could be considered as potential contributors to FELUs. The Initiative Selector provides the user with a mechanism to explore the initiatives identified in the Guide. This task is discussed in detail in Chapters 7 and 9. 3.3.4 Stakeholder Engagement It is important to gather feedback and guidance from the various stakeholders affected by freight activity and the potential FELU initiatives that could be implemented. This step is dis- cussed in detail in Chapter 4. The transportation planning process has largely integrated freight stakeholders (shippers, carriers, receivers, and their representative associations) into its methods. Notably, the FAST Act advocated state freight advisory committees. However, transportation is only half of the equation to create FELU decisions. As freight transportation planning matured, the other half of the puzzle, land-use planning, was largely left out of the conversation. Integrating freight stakeholders into the land-use planning process will be more compli- cated than integrating them into transportation planning process. The integration of freight stakeholders into the transportation planning process has largely happened at the metropolitan planning organization (MPO) and state department of transportation (DOT) level. The land-use planning process takes place at the county and incorporated municipality levels. There are 50 state DOTs, 408 MPOs and 19,354 incorporated places in the United States. While each of incorporated place might not have land-use controls, the difference in scale is clear. The inclu- sion of freight stakeholders in the land-use and transportation planning processes will be key to creating FELU decisions. A great deal of freight movement is driven by the location of freight shippers, distribution points, and receivers. With the rise of e-commerce, the receiver is often a residential building. Managing where freight has to be can decrease externalities on local com- munities and supply chains. 3.4 Overview of Suggested Decision-Support Tools The Guide is complemented with qualitative and quantitative decision-support tools that provide conceptual depictions and ideas about general impacts and implications of land-use initiatives and some of the numerical estimates needed for engineering and economic analyses. This combination of techniques is effective, flexible, and trustworthy. The decision-support tools suggested for use include the following: • Freight and Service Trip Generation Software (FASTGS). This tool estimates the generation of freight and service trips by commercial establishments. It uses either employment data at the zip code level, which are publicly available, or employment data at the establishment level provided by the user, to estimate the number of deliveries received and shipments sent out by commercial establishments (Holguín-Veras et al. 2017c).

Development of a FELU Program 23   • Land-Use and Transportation Initiative Selector. A dynamic webpage that, for a given set of inputs, provides practitioners with suggestions about potential initiatives to address land-use issues. This tool allows users to specify the problem they face, and obtain suggestions of poten- tial solutions. Clicking on a suggestion produces a one-page summary that provides additional information about the initiative to aid the user in considering its use (Holguín-Veras et al. 2021). • Behavioral Micro-Simulation for FELUs (BMS-FELU). This is a standalone software that enables practitioners to compute aggregate metrics of performance related to the impacts of land use on supply chain activity. The BMS-FELU reads freight trip data files (produced by the FASTGS), the travel times to and from the transportation analysis zones (including the location of distribution centers), the distribution of the number of stops by industry sectors, and other input files to conduct a simulation of the supply chains operating in the area. The BMS-FELU produces a number of performance metrics that quantify the efficiency of the study area’s supply chains.