<DOC>
[108 Senate Hearings]
[From the U.S. Government Printing Office via GPO Access]
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S. Hrg. 108 - 640
THE ADMINISTRATION'S PROPOSAL FOR
REAUTHORIZATION OF THE FEDERAL
PUBLIC TRANSPORTATION PROGRAM
=======================================================================
HEARING
before the
COMMITTEE ON
BANKING,HOUSING,AND URBAN AFFAIRS
UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
ON
THE REAUTHORIZATION OF THE PUBLIC TRANSPORTATION TITLE OF THE
TRANSPORTATION EQUITY ACT FOR THE 21ST CENTURY (TEA-21) WHICH EXPIRES
ON SEPTEMBER 30, 2003
__________
JUNE 10, 2003
__________
Printed for the use of the Committee on Banking, Housing, and Urban
Affairs
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COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS
RICHARD C. SHELBY, Alabama, Chairman
ROBERT F. BENNETT, Utah PAUL S. SARBANES, Maryland
WAYNE ALLARD, Colorado CHRISTOPHER J. DODD, Connecticut
MICHAEL B. ENZI, Wyoming TIM JOHNSON, South Dakota
CHUCK HAGEL, Nebraska JACK REED, Rhode Island
RICK SANTORUM, Pennsylvania CHARLES E. SCHUMER, New York
JIM BUNNING, Kentucky EVAN BAYH, Indiana
MIKE CRAPO, Idaho ZELL MILLER, Georgia
JOHN E. SUNUNU, New Hampshire THOMAS R. CARPER, Delaware
ELIZABETH DOLE, North Carolina DEBBIE STABENOW, Michigan
LINCOLN D. CHAFEE, Rhode Island JON S. CORZINE, New Jersey
Kathleen L. Casey, Staff Director and Counsel
Steven B. Harris, Democratic Staff Director and Chief Counsel
Sherry Little, Legislative Assistant
Richard Steinmann, FTA Detailee
Sarah A. Kline, Democratic Counsel
Aaron D. Klein, Democratic Economist
Joseph R. Kolinski, Chief Clerk and Computer Systems Administrator
George E. Whittle, Editor
(ii)
C O N T E N T S
1 ----------
TUESDAY, JUNE 10, 2003
Page
Opening statement of Chairman Shelby............................. 1
Opening statements, comments, or prepared statements of:
Senator Johnson.............................................. 3
Senator Enzi................................................. 4
Senator Corzine.............................................. 5
Prepared statement....................................... 38
Senator Bunning.............................................. 6
Senator Stabenow............................................. 7
Prepared statement....................................... 38
Senator Miller............................................... 9
Prepared statement....................................... 39
Senator Santorum............................................. 9
Prepared statement....................................... 40
Senator Reed................................................. 10
Prepared statement....................................... 40
Senator Sarbanes............................................. 11
Senator Carper............................................... 13
Senator Bennett.............................................. 26
WITNESSES
Norman Y. Mineta, Secretary, U.S. Department of Transportation
Accompanied by Jennifer L. Dorn, Administrator, Federal Transit
Administration, U.S. Department of Transportation.............. 15
Prepared statement........................................... 41
Response to written questions of:
Senator Reed............................................. 72
Senator Sarbanes......................................... 75
Senator Dole............................................. 77
William Millar, President, American Public Transportation
Association.................................................... 29
Prepared statement........................................... 48
Response to written questions of:
Senator Shelby........................................... 79
Senator Reed............................................. 82
Senator Sarbanes......................................... 84
Jeff Morales, Director, California Department of Transportation,
on behalf of The American Association of State Highway and
Transportation Officials....................................... 31
Prepared statement........................................... 52
Response to written questions of:
Senator Shelby........................................... 86
Senator Reed............................................. 88
Senator Sarbanes......................................... 89
Robert Molofsky, General Counsel, Amalgamated Transit Union...... 33
Prepared statement........................................... 54
Response to written questions of:
Senator Shelby........................................... 89
Senator Reed............................................. 95
Senator Sarbanes......................................... 96
Harry W. (Woody) Blunt, Jr., President, Concord Coach Lines,
Concord, New Hampshire on behalf of the American Bus
Association.................................................... 35
Prepared statement........................................... 64
Jim Seal, Former Consultant, Federal Transit Administration...... 36
Prepared statement........................................... 68
Additional Material Supplied for the Record
The Benefits of TEA-21 Funding Guarantees by the Jeffrey A.
Parker, December 2002.......................................... 101
THE ADMINISTRATION'S PROPOSAL FOR
REAUTHORIZATION OF THE FEDERAL
PUBLIC TRANSPORTATION PROGRAM
----------
TUESDAY, JUNE 10, 2003
U.S. Senate,
Committee on Banking, Housing, and Urban Affairs,
Washington, DC.
The Committee met at 10:01 a.m., in room SD-538 of the
Dirksen Senate Office Building, Senator Richard C. Shelby
(Chairman of the Committee) presiding.
OPENING STATEMENT OF CHAIRMAN RICHARD C. SHELBY
Chairman Shelby. The hearing will come to order.
I am pleased this morning to welcome Transportation
Secretary Norman Mineta. Mr. Secretary, it is always good to be
with you. I am very glad you could come and be with us today. I
appreciate that you and other panelists took the time to come
before the
Committee.
I asked Secretary Mineta to share the details of SAFETEA,
the Administration's proposal to reauthorize the surface
transportation program. Obviously, this Committee is most
interested in the transit title of the bill. TEA-21 expires on
September 30 of this year, and I have made transit
reauthorization a high-priority item for the Committee's
consideration. This is the second hearing, Mr. Secretary, we
have had on transit at the Full Committee level, but it won't
be the last.
We had the benefit of hearing from Federal Transit
Administrator Ms. Dorn, who is with us today, on March 13, when
the Committee invited her to come discuss the details of the
2004 budget proposal for FTA. Embedded in the budget were many
of the Administration's ideas for reauthorization, so the
Committee got an early opportunity to digest many of the
central components of the proposal. When the SAFETEA proposal
was formally conveyed to the Congress in late May, months later
than it was expected--but better late than never, as we say--we
were already armed with some advance information about its
content.
As such, we have had the opportunity not only to learn some
of the details of the proposal, but we also have had the chance
to react to them as well. Many of you have already heard that
the Ranking Member and I are opposed to reducing the Federal
match for New Start projects from 80 percent to 50 percent
while maintaining the 80 percent Federal share for highway
projects. I believe that would be a mistake and would create an
imbalance between the two modes. I think our goal should be to
remain mode-neutral and allow communities to make decisions
about what best suits their needs and maintain a level playing
field.
I am most concerned, however, about the idea of eliminating
the Bus Program. To many people, bus service is the lifeblood
of the transit system. In the majority of communities, bus
grants are an invaluable resource and buses the sole mode of
public transportation. Eliminating the program would be
detrimental to mid-sized communities who need lump sums to make
bus purchases and build bus facilities.
Another item I want to mention is the overall inadequacy of
the total funding level. This is an argument that I anticipate
that you will hear several Members of the Committee comment on.
Mr. Secretary, you may be aware that the Senate passed an
amendment to the budget that would increase the overall number
for highways and transit. That amendment, which was passed with
the support of 79 of my colleagues, bumped up the number for
transit to $56.5 billion. Certainly that vote is reflective of
the growing demand and need out there for more resources.
Unfortunately, the $46 billion proposed in SAFETEA doesn't
address the concern. The level proposed by the President is a
current services budget and, I think, it is insufficient. Mr.
Secretary, that gives you a thumbnail sketch of what about the
proposal concerns me and others, so let me now move to tell you
what I do like about your bill.
I am pleased that rural transit is finally garnering the
attention it deserves. I have seen value in fostering rural
connectivity in communities all over the country. Currently, 40
percent of rural counties offer no transit service at all, and
increasing the opportunities to provide essential bus service
in rural America I think is a very positive step.
I also like the idea, Mr. Secretary, of expanded
eligibility for bus rapid transit in the New Starts category.
We need to have discussions about how exactly this would work
in practical application, but I am favorable here. I think this
is a good proposal. The Committee will be holding a hearing on
just this issue on June 24. As it is an emerging technology
that was not a viable option during the time of the TEA-21's
writing, I think it is especially important that we look at it
and look at it closely.
I am pleased that you have put a focus on fostering
coordination between the providers of social service
transportation. This is an area long disregarded, and I think
your proposal responds to a need, first identified by the GAO,
to make human service coordination of transportation services a
priority.
There are several other areas I think represent progress
and others where the basic idea was sound but the details may
require some tweaking. I am intrigued by the idea of
performance incentives for ridership increases. And I want to
learn more about how you envision that working.
I would like to make sure that there is an equal focus on
building efficiencies, both in capital investments as well as
operational expenses. Transit agencies should be held
accountable for their cost and ridership projections for New
Starts projects and, certainly, transit agencies should be
making the utmost effort to identify areas in need of reform
that drive up the daily cost of doing business. Addressing both
of these items will be useful in ensuring that transit
resources are carefully spent and are spent for the benefit of
those to which it is intended--the riders of public
transportation.
With that, Mr. Secretary, we will see if there are any more
opening statements. Senator Johnson.
STATEMENT OF SENATOR TIM JOHNSON
Senator Johnson. Thank you very much, Mr. Chairman. I
appreciate you holding today's hearing to consider how to
improve our transit programs.
Welcome to Secretary Mineta, Ms. Dorn. Secretary Mineta is
a long-time friend and a former colleague of mine in the golden
days of the House of Representatives.
Secretary Mineta. We all are.
Chairman Shelby. All of us have served in the House. We are
all colleagues.
Senator Johnson. That is true. I am very appreciative of
his continued public service to our country.
As we work to develop a bill on transit funding, I want to
work with the Committee to address the particular needs of
rural States such as my own, South Dakota. I appreciate that
when people think of transit, they largely think of urban
areas, and properly so. I have been a long-time supporter of
Amtrak and light-rail development, and I recognize the transit
needs of our urban areas. My title is U.S. Senator, not South
Dakota Senator.
But at the same time, in the past rural areas have not
received all the attention that they deserve. Many of my fellow
South Dakotans rely heavily on transit. We have very low-
density areas in our State, and yet they need adequate transit
service, particularly for senior citizens and disabled. My
State, with an increasingly elderly population, is home to a
significant transit-dependent population. Although the transit
program should always have considerable emphasis on large urban
areas, current transit formulas frankly do not adequately meet
the needs of rural States such as mine.
Mr. Chairman, I want to address the needs of my State as
part of a plan that is good for the country as a whole, and I
want to help the Banking Committee grow the program.
Unfortunately, in my view, the Administration's SAFETEA program
does not grow the program, and I share the concerns of many
over the Administration's plan to reduce the Federal match for
New Starts. I believe that rural transit does not receive a
sufficient Federal match, and I certainly intend to work with
my urban friends on the match issue for all of us.
I want to make a few more points on rural transit. First,
it is not enough to just increase funding for the rural
program. The current rural formula just doesn't get enough
money to States that need it most. We need a per-State minimum
in some categories. Mr. Chairman, to do this will not cost very
much. It is also important to remember that none of the New
Start money goes to South Dakota.
Mr. Chairman, South Dakota does participate, most years, in
the Discretionary Bus Program that you have alluded to, and I
share your discomfort with the elimination of that program. To
illustrate my point, South Dakota's share of discretionary bus
funding last year was greater than the additional funding that
the
Administration would send to my State each year through
increases in the Rural Transit Program.
In conclusion, last year I cosponsored S. 2884, which
provided a reasonable floor per State under the funding level
for the Rural Program, for the Elderly and Disabled Program,
and for small metro areas. And I was pleased that Senators
Allard, Crapo, Hagel, and my friend Mike Enzi are Members of
this Committee who also cosponsored that measure. That bill
also clarified the ability to use Elderly and Disabled Program
funds for operating assistance and would increase the Federal
match for operating costs in the Rural Program.
Western States do not have transit match parity with
highways as the highway match in Western States is over 80/20
due to the Federal lands adjustment in the Highway Program.
This adjustment should also apply to the Transit Program, at
least for the Rural Program, the Elderly and Disabled Program,
and small metro areas such as Sioux Falls or Rapid City.
I want to work with the Chairman and Ranking Member to
strengthen public transportation as a whole, and I believe that
the key concepts that others have joined me in advancing last
year should and can be accommodated in our work this year.
Thank you, Mr. Chairman. Thank you, Mr. Secretary, and I
look forward to hearing from our panelists today.
Chairman Shelby. Senator Enzi.
STATEMENT OF SENATOR MICHAEL B. ENZI
Senator Enzi. Thank you, Mr. Chairman, and thank you for
holding this hearing.
Over the weekend I was in Cody, Wyoming, and mentioned that
I would be at this hearing, and State Senator Simpson sends his
greetings to you.
Secretary Mineta. I will see him on July 4.
Senator Enzi. A lot of times people, when they think of
Wyoming, do not think of transit. But we and South Dakota and
some of the other Western States were the early developers of
Share-a-Ride. That means two people on a horse.
[Laughter.]
Senator Enzi. We are interested in getting from one place
to another, and that is how that came about. So despite our
small
population, we have some very real transit needs that need to
be addressed. Unfortunately, the current funding distribution
model for transit programs leaves behind the States with
smaller populations like Wyoming, and a lot of these comments
will be an echo of what Senator Johnson said.
This year, Wyoming entities received approximately $5.1
million in transit funds. That equals approximately seven one-
hundredths of 1 percent of the transit program. Of these funds,
50 percent came from a $2.5 million one-time allocation from
the Discretionary Bus Program because of the fine work of
Chairman Shelby on the Appropriations Committee. I did want to
acknowledge and express my appreciation for your efforts in
that matter. It was a tremendous help to Wyoming.
Unfortunately, the Administration proposes in SAFETEA to
end this critical program which may result in even fewer
dollars for Wyoming. Although there will be an overall increase
for rural programs, it does little to ease my concerns about
the need to provide adequate transit funding for all States.
Simply throwing more money in the pot will not yield the
results we are hoping to achieve; rather, I fear it will
produce some big winners and some big losers. Although each
State may receive the same percentage increase, that won't help
States like Wyoming that start out with only seven one-
hundredths of 1 percent of the transit budget.
Last year, Senator Allard brought in a witness from rural
Colorado who recommended a minimum of $5 million per State
annually for the Rural Transit Program. That was picked up in
the bill S. 2884 that Senator Johnson mentioned that a number
of us are cosponsors of that kind of approach to this problem.
We need a small-State minimum for both the Rural Transit and
the Elderly and Disabled Program. Small-State minimums are
common for a number of formula-based programs because certain
costs are present regardless of the location or the population.
A little does go a long way in these small States, and that is
why I cosponsored that bill. It was a good bipartisan effort to
address rural issues at a very modest cost.
I am very pleased we are taking a closer look at these
issues in
this hearing today because rural States do have transit needs,
too, and the current rural formula does not work for the rural
States. We need more vanpools and other systems to help seniors
and disabled and others in small communities. In addition, we
also have to find ways to get seniors, disabled individuals,
and other community members more strongly connected to the
world beyond the city limits.
I was pleased to learn the Administration included in its
proposal a section on intermodal transportation. Intermodal
transportation will be particularly beneficial for people in
rural areas who have limited access to air and rail
transportation, and that, again, kind of defines Wyoming.
Connecting these systems will provide some real efficiencies
that will save both travelers and the Government real money.
I am looking forward to working with you, Mr. Chairman, on
the Committee's bill and on problems I have outlined today. A
number of us will be vigilant as we will show our interest in
the transit projects that are very interesting and critical to
rural and urban
America.
Thank you, Mr. Chairman.
Chairman Shelby. Senator Corzine.
STATEMENT OF SENATOR JON S. CORZINE
Senator Corzine. Thank you, Mr. Chairman, and I appreciate
your holding this hearing, and I, like all my colleagues,
welcome Secretary Mineta, who is a terrific voice for
transportation in this country and a terrific voice in general
of a servant for our Nation.
That said, I have strong doubts that SAFETEA will be
sufficient, in at least my perspective, on meeting the needs
facing our Nation's mass transit infrastructure. Challenges
posed by increased ridership and aging of the rail and bridge
network require a strong level financial commitment from the
Federal Government, and, unfortunately, I find the level not
consistent with what the needs are being defined. I am quite
positive all of us can talk about more resources, but I think
that if we are to deal with the kinds of transportation
problems we have in my State, the most densely populated State
in the Nation--actually, more densely populated than India--we
need to have the development of these mass transit systems for
quality of life, environmental, and economic bases that
are important.
I just think the amount, the $45 billion plus in mass
transit spending over the next 6 years is just not adequate, in
my view. By our perspective, it is a 1.2-percent cut, if you
take into account inflation, under the authorized amount under
TEA-21 and falls well below the Senate's $56.5 billion that we
talked about.
I think you are all aware of the Conditions and Performance
Report, and the difference between what is requested here and
the additions just do not match. We should be doing more both
for the rural States, obviously, some of the needs that my
colleagues have mentioned are important, but in no way do I
think that can take away from the fundamental needs of our
urban communities in, as I say, the most densely populated
State.
We have been very fortunate in New Jersey in the sense that
we have been treated well in the New Starts Program, but that
is only because we are catching up on huge gaps in investments
that need to be made, and we have argued long and hard about
light-rail projects which would significantly change, as I
suggested, the quality of life, environmental considerations,
and economic development in the region. I also would mention in
that context that we are number 49 in the dollars sent off to
Washington of the 50 States and receiving it back. It is a hard
argument not to deal with in my State that such a fundamental
need as mass transit is not talked about.
I am deeply opposed to this proposal that would cap new
Federal funding at 50 percent instead of the 80/20 Federal-
State split. It is going to be an unbelievably burdensome
change with regard to our States, wherever you are, with regard
to their current fiscal situation, the long-run fiscal
situation as we see. So while I know of the Secretary's
personal commitment to transportation, there is a lot of work
for us to improve this. I would like to be as cooperative as
possible and work closely with the Chairman and the Committee
to make that possible.
Thank you.
Chairman Shelby. Senator Bunning.
STATEMENT OF SENATOR JIM BUNNING
Senator Bunning. Thank you, Mr. Chairman. I would like to
thank all of our witnesses who are testifying today, and I
would especially like to welcome my good friend Norm Mineta,
Secretary Mineta, excuse me, to the Committee.
As we all know, Congress will be working on a
transportation reauthorization bill this year. This is a big
deal to all of us, and we all have very many transit needs. We
have been hearing from the communities in our States about
their transit needs. Primarily in Kentucky, the needs are for
rural transportation. We do have needs for buses in Lexington,
northern Kentucky, and Louisville. Louisville is also
interested in a light-rail system. They are very far along with
their studies and would like to start the new construction
phase. I would like to concentrate on the rural needs today.
Kentucky has 30 rural transportation providers who receive
Federal assistance. We also have three small urban systems
serving largely rural counties: Henderson, which also serves
Henderson County; Owensboro, which also serves Daviess County;
and Ashland, which also serves Boyd County. Federal assistance
is critical to these agencies. Without it, they would cease to
operate, leaving hundreds of thousands of Kentuckians immobile.
Many of the riders are elderly or disabled, and rural
transit is their only way to shop, visit the doctor, go to
church, and interact with others. Rural transit also provides
transportation for our workers to their jobs in some of the
most economically depressed areas of the State and the country.
Rural transportation is vital to our Commonwealth and yet
only requires a handful of new buses or vans statewide each
year. And operating costs for the whole State are just a
fraction of what any large metropolitan area needs.
Finally, since this is my only shot at Secretary Mineta
this year, I think I would be remiss if I did not mention some
other transportation needs. We are a State that is bordered by
two major rivers, so we have a lot of bridge needs. Louisville
has a request in for two bridges, which I am sure you have been
made well aware of. But northern Kentucky/Cincinnati, which
also needs a bridge to replace the Brent Spence Bridge, that
allows I-71 and I-75 to cross the Ohio River. The Brent Spence
Bridge was designed to carry 80,000 vehicles per day.
Presently, it is carrying 150,000 vehicles during rush hour,
and it is nearly impassable and is a great safety hazard
because of truck congestion and deterioration due to the very
large volume.
Because I-71 and I-75 are both major North-South
interstates, it is truly a national project. It serves the
busiest trucking corridor in the country, and these highways
are the main routes for four major international airports.
Kentucky and Ohio are united in their support for the
replacement and are moving forward together, but we must have
Federal assistance soon to ensure that a suitable replacement
is constructed before the Brent Spence Bridge becomes
unsuitable.
Once again, thank you, Mr. Secretary, for being here and
all the other witnesses that are going to testify.
Thank you.
Chairman Shelby. Senator Stabenow.
STATEMENT OF SENATOR DEBBIE STABENOW
Senator Stabenow. Thank you, Mr. Chairman, and welcome to
all of those who will be testifying. Secretary Mineta, it is
wonderful to see you again.
Mr. Chairman, I do want to speak for a moment but have my
full comments in the record.
Chairman Shelby. Without objection, your statement will be
made part of the record.
Senator Stabenow. Thank you.
Ensuring safe and efficient public transportation is one of
the most critical issues that we will face as a Committee, and
I know we all share a great interest in this, and I look
forward to working with you, Mr. Chairman, and with the
Committee.
Michigan is known as an automobile State, and we take great
pride in producing and driving our automobiles. But we also
have tremendous mass transit needs. And in the year 2002 alone,
Michigan buses carried over 88 million passengers, so this bill
is a big deal for Michigan and for our citizens.
There are bus systems operating in every one of our 83
counties, from urban Wayne County to rural counties in the
Upper Peninsula. And despite covering all the counties, service
in many of our areas is minimal, creating a hardship for
working families who cannot afford to own a car. I share the
concerns of my colleagues regarding rural communities, and
northern Michigan and other parts of our State, as well as my
colleagues who talk about urban areas, we have both and have
needs in both.
Last month, a Detroit News series chronicled how
underfunded our transit systems are and how they impact our
working families. The article focused on following Detroiter
Karen Gholston, who stands at the bus stop every morning at
3:30 in the morning with her 2-year-old daughter in one hand
and a can of pepper spray in the other, waiting to catch a bus
for her 6 a.m. class. This is not unusual among those who are
working and trying to get ahead as part of working families.
Despite the fact that her class is only 12 miles away, it
takes Karen 2\1/2\ hours to get there because the bus only runs
once an hour and is often late and sometimes doesn't come at
all. This is an example of what we in Michigan are facing, and
given that fact, I have serious concerns about the
Administration's SAFETEA proposal and am looking forward to
your comments.
First, SAFETEA not only fails to grow the transit program
to help us and help the woman that I just spoke of, but it also
cuts funding from the prior TEA-21 authorization. The
Administration's proposal only provides $37.6 billion in
guaranteed funding, which is a 7.6-percent cut from TEA-21's
guaranteed funding level when adjusted for inflation. And this
is of great concern to me.
The SAFETEA proposal also eliminates the guaranteed funding
for the General Fund portion of the transit program, and,
again, limiting this funding is forcing transit to compete for
20 percent of its funding in a very tight, difficult budget is
of grave concern to me.
Finally, the Administration's proposal eliminates the 5309
Bus Discretionary Program, and as a representative of a State
that relies almost solely on bus systems for its public transit
needs, even though we are looking to options for light rail, we
predominantly use our bus systems right now, I find this
particularly alarming.
According to the Michigan Department of Transportation,
Michigan's estimated transit capital and operating needs total
nearly $1.5 billion over the next 6 years. And much of this
capital investment is needed to simply keep existing service
going, even though ridership is increasing.
Under TEA-21, Michigan received over $124 million under the
Bus Discretionary Program, but our capital needs have exceeded
$600 million. So there is a huge gap there. This shortfall
exists despite the significant contributions by Michigan
taxpayers. Michigan ranks sixth behind five States with rail in
direct support for our public transit systems, and we
unfortunately already rank last in Federal transit funding
among the Great Lake States and only receive 43 cents back on
every transit dollar that we contribute to the Highway Trust
Fund.
These are serious issues for us. I am looking forward to
working with you to address these. The people in Michigan are
counting on us to be able to do a better job for them, and I
look forward to working with my colleagues on the Committee.
Chairman Shelby. Thank you.
Senator Miller.
COMMENTS OF SENATOR ZELL MILLER
Senator Miller. Mr. Chairman, I would like to thank you and
Senator Sarbanes for organizing this hearing, and I would
certainly like to thank Secretary Mineta and the other members
of the panel that we are going to be hearing from. I have some
prepared remarks that I would like to ask unanimous consent be
made part of the record.
Chairman Shelby. Without objection, so ordered. It will be
made part of the record in their entirety.
Senator Miller. I would also like to say this for a few
minutes. I was around as a Governor in 1991 when ISTEA came
along, and I was still around in 1998 when TEA-21 came along,
so I know very well the benefits of these programs to the
States of our Nation. And there is no doubt that in
transportation, like in so many other areas right now, the
needs outpace the resources, and we are going to have to deal
with that. So I am interested in listening and hearing about
the funding level of SAFETEA, but at the same time, Mr.
Secretary, I am also interested in retaining the important
flexibility and the minimum guarantees and what I call the
firewalls that State transportation planning organizations
enjoy today.
Thank you.
Chairman Shelby. Senator Santorum.
COMMENTS OF SENATOR RICK SANTORUM
Senator Santorum. Thank you, Mr. Chairman. I just also
would like to submit my statement for the record.
Chairman Shelby. Without objection, it will be made part of
the record.
Senator Santorum. Thank you, Mr. Chairman.
Just a couple of things that I wanted to stress, and that
is, the idea of transportation, public transportation, and the
role in welfare and the role that it has played and the
important role that I hope it continues to play in getting
people to jobs who are transitioning off of welfare. We have
programs that we passed in the 1996 welfare bill, and I want to
continue to see those programs grow as a way for us to get some
of these intractable problems that we have, not just in our
inner cities but in our rural areas. And I look forward to
working very closely with you, Mr. Secretary, and the
Department in making sure that those programs are expanded and
create better access for those people in need of transportation
to get to their jobs, again, to transition themselves off
welfare.
I, too, want to express concerns--at least I have some
concerns about the New Starts at 50/50, and I just see that as
a real prejudice with any kind of major projects. In a sense,
the closer you get to funding these projects at 50/50, the
harder it is, obviously, for the locals to come up, and that
means these big projects, some of which are very, very
important and transformational for our cities in particular,
tend to get pushed back in favor of smaller projects that are
easier for those communities to budget for.
I am not too sure in the long run that you end up with
better transportation networks as a result, and so I think that
locking in that number is not going to be beneficial for the
efficient use of transit in our urban communities in
particular. And having two large urban communities in my State,
both of whom have major projects in the pipeline, I want to put
my marker down as expressing a very deep concern about that
allocation.
Thank you, Mr. Chairman.
Chairman Shelby. Senator Reed.
STATEMENT OF SENATOR JACK REED
Senator Reed. Thank you very much, Mr. Chairman. It is good
to welcome Secretary Mineta and Administrator Dorn. They both
do an extremely good job for us.
I am pleased that you are here today, and I think your
presence and the fact that the Chairman is holding this hearing
signifies the importance of transit all across the country.
Last year, in the Subcommittee we listened to representatives
from cities like Salt Lake City, Atlanta, and other major
communities across the country, and they all spoke to the
critical importance of transit, not just in terms of moving
people around but in making sure there is a quality of life and
an economic vitality in their cities.
I am pleased that in the proposal the Administration has
put forth, principally, I think, through the leadership of both
of you, that there is a preservation of the share of the
transit funding from the gas tax at the levels of 20 percent of
the fund. I think this reflects your longstanding support for
balanced national intermodal transportation policy. But I have
three major areas of concern with the bill that has been
proposed.
First is the failure to provide new resources for transit.
I think everything you have heard today from every Member is
the need, the growing need, for more resources for transit, and
that is not just in the traditional Northeastern or West Coast
urban centers, but it is in places like Atlanta and Albuquerque
and Denver. More resources are necessary, and I do not think
there are sufficient resources to do the job.
The second point I would raise would be the failure to
guarantee the transit funding in SAFETEA. There has to be a
strong guarantee that transit funding will be there, that it
won't be subject to rather innovative financing mechanisms or
other ways to do it, but it will be there guaranteed.
And, finally, I am concerned also that there is
insufficient specific funding for transit security. We had
several hearings last year, and, indeed, Senator Sarbanes and I
asked the GAO to do a report. They looked at just eight transit
systems, and they determined that those systems alone would
need $700 million to effectively protect them from terrorism.
And that is just an example of the kind of resources we will
need as we prepare ourselves--we hope it is just simply
preparation and never an eventuality, but prepare ourselves for
possible terrorist activity.
I look forward to working with you, Mr. Secretary, and with
Administrator Dorn, Chairman Shelby, Ranking Member Sarbanes,
and Chairman Allard to craft a TEA-21 successor bill that will
provide the resources and the flexibility to continue our
success in transit.
It is good to see you are well, Mr. Secretary, after your
operation. I knew your anesthesiologist who was my classmate at
West Point. That was my only concern.
[Laughter.]
Chairman Shelby. Thank you.
Senator Sarbanes.
STATEMENT OF SENATOR PAUL S. SARBANES
Senator Sarbanes. Well, thank you very much, Mr. Chairman.
First, I want to commend you for holding this hearing and also
for your indication that other hearings on this important issue
will be following.
Chairman Shelby. Absolutely.
Senator Sarbanes. I want to thank Secretary Mineta for
appearing, and Administrator Dorn, we are pleased to have her
back before the Committee.
Actually, sometimes people say, you know, all those opening
statements by Members of the Committee, what purpose do they
serve? But I have been sitting here this morning listening very
carefully to my colleagues, and I must say I think they have
laid out a lot of very serious and important concerns. We are
getting this reflection from the grass roots, so to speak, with
respect to the transit programs. So, I think it is serving a
very important purpose here this morning to put before the
Secretary and the Administrator the challenges that are ahead
of us.
As Senator Reed commented, we held hearings in the last
Congress. In fact, the full Committee and Senator Reed's
Subcommittee, held a series of eight hearings on transit
issues. Secretary Mineta, you kicked off those hearings,
actually, last year. And the witnesses included elected
officials, business leaders,
transit operators and riders, consumer users, and they gave us
some very thoughtful testimony, which I think, frankly, can be
summarized by saying that TEA-21 has worked. That was the
general view.
Investment in transit over the last 6 years has increased
by almost 50 percent. As a result, we have seen increased
ridership all across the country. Transit saw the highest
percentage of ridership growth among all modes of surface
transportation in the period from 1993 to 2001, experiencing
almost a 30-percent increase. More and more communities are now
considering transit investments, and this is a record of
success which needs to be built on.
We also face a struggling economy. The unemployment rate is
the highest in 9 years. With TEA-21's reauthorization, we have
an opportunity to support a program with a proven record of job
creation. The U.S. Chamber of Commerce estimates that each $1
billion invested in transportation infrastructure creates about
48,000 jobs. Transportation investment has a broader economic
benefit as well. The U.S. Conference of Mayors has pointed out
how much of our Nation's economic output and jobs are in the
metropolitan areas. Increasingly over the last decade,
congestion is threatening the economic viability and livability
of these areas, costing millions of Americans time and money
that could be put to more productive use.
Earlier this year, when Administrator Dorn was here to
present the Administration's fiscal year 2004 budget request, I
outlined three basic principles that I believe any
reauthorization bill must include if we are to address the
challenges we face. And some of those have already been
enunciated by others, but I very briefly want to reiterate
those principles.
First, we need to enlarge the transit program. I think
virtually everyone recognizes that. I am concerned that the
Administration's proposal not only fails to grow the program,
taking into account inflation, but it also cuts guaranteed
funding over the 6-year period so that the guaranteed level in
fiscal year 2009, $6.6 billion, is
actually less than the program level today at $7.2 billion.
This is
the guaranteed level. We need to increase the overall amount,
but within that, we need to make sure that we sustain the
guarantee levels.
DOT itself has identified $14 billion a year in capital
needs simply to maintain the condition and performance of our
transit systems, $20 billion to improve conditions and
performance. And some of the witnesses on our second panel
today have estimated even greater needs.
Second, we need to maintain the funding guarantees which
have been very important in enabling local and State
governments to plan effectively. As I understand it, while the
Administration's proposal maintains those guarantees around the
portion of the transit program that comes from the trust fund,
it eliminates those guarantees from the portion of the program
that comes from the General Fund, which accounts for about 20
percent of the program. So there is a shrinking back of the
guaranteed level, which is a source of great concern.
Also, one of the points made last year at the hearings was
that the funding guarantees must be preserved. It has been, I
think, fair to say that the guarantee level has effectively
established the size of the transit program under TEA-21.
We need to preserve the balance established by ISTEA and
TEA-21 between highways and transit--I know the Chairman made
reference to that in his opening statement--both in terms of
overall investments and in terms of Federal matching ratios for
the highway and transit programs.
We have worked out an accommodation between highways and
transit over the last several authorizations. It has stood us
in good stead, commands general support, and yet the
Administration has proposed to lower the Federal match for New
Starts Transit projects but has not proposed a corresponding
change for highway projects. And Senator Corzine and Senator
Santorum and others made specific reference to that.
Just to underscore the point, when John Inglish, the head
of the Utah Transit Authority, was before our Committee last
year, he said:
Without an 80/20 match, our North-South, our original line,
would not have been built. As a relatively poor system, of the
quarter-cent in sales tax at the time,
we could not have done it with any other match. As it happened,
that line so
transformed.
Senator Santorum used the word ``transformation.''
``As it happened, that line so transformed our community,
that within a year they doubled the sales tax to expand the
public transit system and the program has continued to grow.''
If you weigh it so the highways are at 80/20 and the
transit is at 50/50, you are going to lose that transformation
effect. And I thought Senator Santorum made a very important
point. People will shy away from the major projects that really
change the whole transportation network. They will be more
inclined to do the small incremental things, and we will lose a
major impetus for transforming the transportation
infrastructure.
Having said all of that, I want to take a moment to commend
the Department for including the Transit and Parks Program in
your reauthorization proposal. This has been a pet of mine,
legislation I have introduced now in the last couple of
Congresses to alleviate traffic congestion, improve the visitor
experience in our national parks and other public lands by
providing visitors with alternative transportation options when
they visit these national treasures. What is happening now, you
know, families line up in an automobile, a huge line, emitting
pollution. They all edge up to the admission kiosk. Then they
get there and are told the park is full, and they cannot come
in, there is no more parking and away they go. And we need to
develop systems where they can put their cars somewhere else
and everyone can be brought into the park. It is being done in
some places across the country, and it is working with great
success.
We have a big challenge here ahead of us. The interest of
the Committee is obviously manifest. You have a quorum already
who have come today in order to be here for this hearing, and
we look forward to working closely with the Department. But it
is my own view that we need to strengthen this proposal in a
number of significant respects, and I hope we will be able to
do that in the weeks to come.
Thank you, Mr. Chairman.
Chairman Shelby. Senator Carper.
STATEMENT OF SENATOR THOMAS R. CARPER
Senator Carper. Thank you, Mr. Chairman.
I was in your State of California 2 weeks ago, Mr.
Secretary, and flying into an airport down around LA, not LAX
but John Wayne Airport, as I recall. I thought, ``Well, I never
knew him.'' Then I flew into San Jose, and I was walking
around, and I see everywhere I went, it said Norm Mineta
Airport. I said to a lot of people, ``I know him.'' Good
looking airport. They remember you fondly, and almost every
day, I am told.
Senator Sarbanes. That is a preliminary to getting a Thomas
Carper Airport in Wilmington, Delaware.
[Laughter.]
Senator Carper. In Delaware we do not have any commercial
air service. Amtrak used to have a marketing campaign and the
theme of the marketing campaign is, ``Maybe your next flight
should be on a train,'' and in Delaware all of our next flights
are on trains. Maybe I can get a train station named after me
if I am lucky. Although, Senators Johnson and Stabenow both
told me since I walked in that in my absence you decided to
eliminate funding for Amtrak. So, maybe we will have to find
something else to name after me. Who knows?
Mr. Secretary, thanks for joining us today, Administrator
Dorn. It is good to see you both, and I am looking forward to
this hearing on SAFETEA. Senator Sarbanes said that he regards
TEA-21 as a success in his State and around the country. I do
as well. And it sparked in my little State about a 20 plus
increase in transit ridership since its enactment and that is a
very good thing. And we believe at the heart of the success of
TEA-21 is this combination of several things, the program
flexibility, State and local control, and substantial
resources. And SAFETEA, I am generally pleased to see efforts
to expand flexibility and local control so that communities can
further define and direct the transportation solutions that fit
their respective needs.
Having said that, I do believe the proposal does lack
enough of a third key ingredient, and I am sure you heard some
of that this morning, and that is substantial and guaranteed
resources, and I am afraid that this may be a fatal flaw.
SAFETEA provides, as I understand it, about $46 billion in
total authorization and some $37\1/2\ billion in guaranteed
funding for transit over the next 6 years, and when you compare
that to what we have provided in recent years, it represents
about a little over a 1 percent cut, and maybe a 7\1/2\ percent
cut respectively from TEA-21's total funding level when
adjusted for inflation. I believe in fiscal 2004 the transit
program will be flatlined, the same as that in 2003.
I had a chance to see the highways in your old part of the
world, Mr. Secretary, and I know they look a lot like ours in
the Mid-Atlantic. The highways are clogged with gridlock and
the skies are filled with smog. The critical need for transit
service across our Nation has become I think clearer and
clearer. I believe we need to spend more, not less, to promote
and strengthen transit options in both rural and in urban
areas.
The funding levels put forth in SAFETEA will not allow
Delaware or our Nation to tackle our impending mobility crisis.
These low funding levels are the direct result of the
Administration's opposition to increasing revenue measures such
as raising Federal fuel taxes despite an obvious need for
transportation investment. I realize the difficulties
associated with finding additional revenues for transportation
in these lean times. As a Governor, I sought to raise motor
fuel taxes. We succeeded once, but a couple of other times we
were not as successful. But the money we raised, we put it to
good use.
But I think it is our job to determine the appropriate
funding level and to provide a fair plan to generate that level
of funds, and I hope to work with my colleagues here and in the
Senate to do just that.
Beyond the question of overall funding, I have a couple of
specific concerns with policy changes put forth in SAFETEA. Let
me just mention them. Principally, SAFETEA proposes eliminating
the guaranteed funding or the firewall protection of the
General Fund contributions to the mass transit account of the
trust fund, which would mean reduced funding for transit due to
the competition we all know is going to exist for scarce
discretionary dollars. Guaranteed funding is perhaps the most
crucial component of TEA-21, and I will work hard to resist
changes to the guarantee that could negatively affect the
transit program. I am also concerned by the proposed change of
the statutory Federal share of funding for the New Starts
Program from 80 to 50 percent. I think Senator Sarbanes alluded
to that. I just think we need to maintain an equal funding
level with highway projects, or we risk dissuading communities
from making transit investments, even those that make sense.
I hope to learn more about these issues from your
perspective today, and also about other program changes such as
the elimination of the Bus Discretionary program, changes to
the job access and reverse commute program, and the eligibility
of nonfixed guideways projects through the New Starts Program.
While some of these changes may enhance flexibility and
simplify the program structure, I would like to ensure that
they do not have unintended consequences.
In closing, I just want to again say, Mr. Secretary,
Administrator Dorn, thanks for being with us today, and for the
work that has gone into preparing SAFETEA. I believe the
proposal provided us with a good starting place to being our
debate, and we look forward very much to being part of that
debate with all of you. Thank you.
Thanks, Mr. Chairman.
Chairman Shelby. Thank you.
Mr. Secretary, your entire prepared statement will be made
part of the record in its entirety. You may now proceed as you
wish.
STATEMENT OF NORMAN Y. MINETA, SECRETARY
ACCOMPANIED BY JENNIFER L. DORN, ADMINISTRATOR
FEDERAL TRANSIT ADMINISTRATION
U.S. DEPARTMENT OF TRANSPORTATION
Secretary Mineta. Mr. Chairman, thank you very, very much.
Senator Sarbanes and Members of the Committee, let me thank all
of you for this opportunity to appear before you to discuss the
Administration's proposal to reauthorize our surface
transportation programs entitled the Safe, Accountable,
Flexible, and Efficient Transportation Equity Act of 2003 or
SAFETEA.
I am pleased to have Jennifer Dorn, our Administrator of
the Federal Transit program, here to help me answer any of the
detailed questions you might ask.
The Administration's proposal serves as the largest Federal
transportation investment in our Nation's history. SAFETEA
builds upon the principles, values, and achievements of ISTEA
of which I was the proud principal author in 1991. Of course
then many of you worked on TEA-21 in 1998, while recognizing
the need to address the new challenges.
As a former Member of Congress and having served on the
city council in San Jose and then elected its mayor, I
recognize the importance of this year's reauthorization cycle
to securing the funds and the framework for long-term
investments in our system of transportation. Because the need
for funding predictability for infrastructure investments is
critical to our State and local partners, our Nation cannot
afford the uncertainty of a short-term extension of current
law. So, I urge the Congress to reauthorize a comprehensive 6-
year surface transportation program before the current law,
TEA-21, expires on September 30, 2003.
Though some might suggest an even greater increase in
spending, the facts are clear, the President's proposal
represents a record Federal investment in surface
transportation. From fiscal year 2004 through fiscal year 2009,
SAFETEA would invest over $201 billion on highway and safety
programs and nearly $46 billion on public transportation
programs which is a 28 percent increase over TEA-21. Simply
put, with more than a 28 percent increase in spending over TEA-
21, SAFETEA represents the largest Federal commitment to public
transportation in our Nation's history. SAFETEA promotes common
sense transit solutions by reducing the number of different
program silos and distributing all programs by formula except
New Starts. Rather than have States try to match projects to
specific pots of money, the Federal Government should help
States to maximize mobility and to create a seamless
transportation network. Accordingly, our proposal provides
States and localities with much needed flexibility to fund
priority projects in their communities.
Stable formula funds help agencies to do more with less.
They
provide financial markets the confidence to support transit
investments, provide communities an incentive to commit their
own long-term resources and instill confidence in local
developers. The
necessary transit commitments to support infrastructure growth
will be honored.
SAFETEA proposes a shift to dependable formula and capital
funding and a larger New Starts Program by restructuring FTA
programs into three major categories from the present five.
Under SAFETEA, urban areas will have increased flexibility and
have more predictable funding to improve their ability to make
longer-term investment plans and to acquire necessary
financing. We must ensure that every year each community can
count on a share of these funds. SAFETEA would expand the New
Starts Program by 55 percent and expand capital assistance for
new nonfixed guideway corridor systems and extensions that meet
the New Starts criteria. Today, a fixed guideway is often not
the most cost effective way to provide new or expanded public
transportation service. Today's rules too often require
communities to choose a more expensive, fixed guideway system
in order to qualify for a New Starts grant. Moreover, some
small- and medium-sized communities that might otherwise
benefit from the creation of new transit options simply cannot
generate enough riders or travel time savings to justify a more
expensive fixed guideway system. While fixed guideway projects
are critical and will continue to be eligible for funding,
worthy public transportation projects with lower cost nonfixed
guideway solutions also deserve consideration.
SAFETEA is also based on common sense transit solutions
providing States and localities the opportunity to determine
how they can best service those heavily reliant on public
transportation including rural residents, older adults, persons
with disabilities, and low-income riders. Unfortunately, about
40 percent of rural counties today have absolutely no public
transportation, while others enjoy only limited service.
Because it is exactly these rural residents that most often
rely on rural transit, our proposal increases public
transportation funds for rural communities by 87 percent over
TEA-21.
With stable formula funding, streamlined programs,
performance incentives, and simplified administrative
requirements, our communities will be in a much better position
to leverage the Federal transportation investment in public
transportation and provide Americans with common-sense
solutions to meet their transportation needs. Mr. Chairman,
Senator Sarbanes, and Members of the Committee, that is exactly
what the President's proposal would provide.
Again, thank you for giving me this opportunity to appear
before you today. I would be more than pleased to take your
questions.
Chairman Shelby. Thank you, Mr. Secretary. I have heard
several times from you and the Administration and the
Administrator, who is here, Ms. Dorn, that one of the goals of
the reauthorization is to reduce program silos that have had
the effect of altering local decisionmaking based on the
availability of funds, and I applaud that effort.
I note an inconsistency in that approach in SAFETEA,
however. If the theory is to remain mode neutral, and not allow
the Federal Government's program structures inappropriately to
influence local decisions, why change the Federal match for New
Starts? Would that not cause a highway project to look like a
more attractive option than a transit project?
Secretary Mineta. Next question.
[Laughter.]
Chairman Shelby. You can pass that on to Ms. Dorn, but I
think she is leaning toward you, Mr. Secretary.
Secretary Mineta. Mr. Chairman, there are probably two
overriding issues that people bring up about SAFETEA. One is
the funding level and the other is about the change in the New
Starts Program. Again, let me reiterate that this is the
largest bill involving public transportation investment by any
Administration, larger than ISTEA, larger than TEA-21, and so
from that perspective we are very proud of the bill.
When in doing ISTEA, if you will recall, at the time
highways were 90/10, transit was 75/25. Local communities were
making decisions based on where do they put out the money and
get the most back? Obviously, it was the highway, 90/10,
because transit was at 75/25. That is why in ISTEA I made it
all 80/20, so that everybody made decisions based on what is
the best transportation solution, not where do I get the most
money back for the money that I put on the table? So that was
preserved in TEA-21.
As we look at the experience of what we have in public
transit today, it is something like 49 percent is really the
level of contribution in terms of what comes from the local
communities. The pattern has been that even though the law was
80/20, local districts, in order to get up the food chain,
increased their own local investment in their system and tried
to get more favor because there is more local transit dollars
being invested, and that way, they would be looked upon with
favor by the FTA. The principle of 80/20 is still there in all
of the programs. We have changed it as it relates to New
Starts. We believe we are not only conforming to what we are
experiencing, but it is also the way to be able to spread more
of the money across the country in terms of communities that
want to develop a New Start program.
You mentioned the silos, and that really has been a
problem, and I experienced that as a mayor, and if I might take
the time to give an example. In 1972, President Nixon decided
that he wanted to do a block grant type program, and of course
we had discretionary pots of money in those days, and so as the
mayor of the local community, they chose 14 communities to try
something regarding a block grant program. So we came up with
all of our needs in our community. One of the needs that we
wanted were four community centers, and when I was meeting with
the HUD officials they said, ``We do not have money for your
four community centers. We have money for two. But we notice
that you did not have any submission for sewage programs. So do
you not go ahead and think up $100 million worth of sewage
treatment programs?'' I said, ``I will tell you what, give me
the $100 million and I will go ahead and build the other two
community centers.''
Discretionary pots of money restrict the ability to be
flexible. That is why in this program we have reduced it from
five to three, and given much more flexibility, as Senator
Carper was mentioning, in order to be able to have governors or
mayors, transportation people, be able to use that flexibility
to direct their resources to what is facing them in their local
community or in their States. Because otherwise what we do is
use this theory of, I guess, you might say, margarine spread on
the piece of bread. But that is not how Delaware is, as
compared to Alabama, as compared to Utah, Pennsylvania, and I
think the flexibility that we have in this program really is
giving governors and local transportation people the ability to
be much more flexible and direct their resources.
That is why we have eliminated the silos, why we are trying
to conform to what in reality is occurring right now, and that
is that the local share is now 49 percent.
Chairman Shelby. Senator Sarbanes.
Senator Sarbanes. Thank you very much, Mr. Chairman.
Secretary you mentioned the overall level of funding and
the New Starts ratio as two issues that are being raised. I
also want to talk about the funding guarantees as a very
important additional issue.
But on the New Starts, let me just say that the fact that
as a practical matter you are getting a higher match does not,
in my view, undercut the desirability that the match be the
same between transit and highways at 80/20 in their
overwhelming needs, and if communities are prepared to do a
little more in order to move the project, that is one thing,
but they ought not right up front be confronted with this
discrepancy between 80/20 and 50/50 because it is going to, as
you indicated when you did the 90/10 and 75/25, it is going to
skew their decisionmaking. I go back to this quote from the
head of the Utah Transit Authority, that I read at the outset
in my statement, which I think is very meaningful when he said:
Without an 80/20 match our north-south, our original line,
would not have been built. As a relatively poor system of the
quarter-cent in sales tax at the time, we could not have done
it without any other match. As it happened that line so
transformed our community that within a year, they doubled the
sales tax to expand the public transit system and the program
has continued to grow.
I mean there is pretty strong testimony there. They never
would have embarked on it at 50/50, at least according to this
testimony.
Senator Bennett. That is true.
Senator Sarbanes. It has just been corroborated by the
senior Senator from Utah.
Secretary Mineta. If I might interject, I wonder if Salt
Lake City might now have been a special program because of the
Olympics coming there, and as we do with Olympics, whether it
was in Los Angeles, Atlanta, or as it was in Salt Lake City, we
do pour a great deal of money into those communities. I think
that that has helped, especially when the Governor took the
initiative to tear down I-15 and start all over again, and it
was a program that we supported because of the traffic pattern
in Salt Lake City.
Senator Bennett. I do not want to intrude on your time, but
the light rail proposal started before Salt Lake got the
Olympic bid, and we had to do it to deal with the problem
there. Utah is thought of as a rural State, but 85 percent of
our population lives between the mountains and the lake, and it
is a very relatively narrow situation, and we had to have some
transportation up in there. You talk about tearing up I-15. In
order to get I-15 done in time, the State actually paid more
than 50 percent of the cost of I-15, and we had to do that for
the Olympics. But for the record, the light rail was begun, the
80/20 match was approved and we were underway before Salt Lake
achieved the Olympic bid. I do not, by any means, want to
suggest that the Olympics did not have an impact. You are
right. I think we moved up the queue because of the Olympic
bid, and we received the full funding grant agreement probably
faster than we would have, but in terms of the actual
chronology, it was in before the bid came to Salt Lake.
Senator Sarbanes. Right.
Senator Bennett. Thank you.
Senator Sarbanes. Let me turn to the guaranteed funding
issue. The DOT is on record in numerous venues as supporting
guaranteed funding for the transit program. In fact, the
Administrator
testified here last April, one of the most visible and
important elements of TEA-21 has been the tremendously positive
impact of stable and dependable funding streams on transit
development. You, yourself stated in March: ``The budgetary
firewalls have created confidence among grantees regarding
Federal funding, an extremely important aspect of program
delivery for State and local
officials.''
As I understand it, over the life of TEA-21 the transit
program received 100 percent of TEA-21's guaranteed amount, $36
billion, and only one-half of 1 percent of TEA-21's
nonguaranteed authorization, $25 million out of $5 billion. So,
in effect, the funding guarantees establish the size of the
transit program.
SAFETEA proposes to guarantee highways at $201 billion and
purports to fund transit at $46 billion. But assuming that
transit is actually funded only at the guaranteed level, as was
the case under TEA-21, that would be a highway program of $201
billion compared to a transit program of $37.6 billion. In
other words, you are not providing the guarantee for the
transit money that comes out of the trust fund about 20 percent
of the money. In TEA-21, that money was guaranteed as well, and
as I have indicated, the transit money in effect paralleled the
guarantees. So it seems to me this is a potentially very
serious reduction in transit money. I disagree with your
assertion about this being the biggest program ever. I mean in
nominal terms that is true, but as I understand it, if we
adjust it in real terms for inflation, it does not reach the
TEA-21 levels, but leaving that to one side, the drop of a
guarantee for 20 percent of the money has potentially extremely
severe implications for transit. What is your take on that
issue?
Secretary Mineta. In TEA-21, the guarantees only apply to
the amount that comes from the trust fund, both the highway and
mass transit account, as you have indicated. The portion that
comes from General Funds is not guaranteed. There are no other
guaranteed programs in the Federal budget. And the only one
that was guaranteed was transit.
We feel confident transit programs can compete effectively
for General Funds, even if they are not included in the
firewall. This was a discussion that went on for a long time
and part of it is the fact that how do we isolate transit
programs for the total Federal programs and say, yes, they
should have a guarantee? It then
precludes Congress or the Administration from shifting
priorities whenever some need arises including, let us say,
September 11. So that is why we felt that the feeling was that
we should not tie the hands of future Congresses or the
President with General Fund firewalls.
Senator Sarbanes. I thought September 11 was a very
powerful argument for further enhanced investment in transit.
Am I wrong about that? That is my understanding, that the one
response to that is we have to beef up these transit systems.
These people were moved out of Washington and New York on the
transit systems, were they not?
Secretary Mineta. Well, most of the movement was I think on
the commuter rails rather than on the local transit systems,
the MTA, but mostly the----
Senator Sarbanes. Amtrak.
Secretary Mineta. Amtrak, New Jersey Transit.
Senator Sarbanes. So you are back to supporting Senator
Carper on Amtrak? We are going to keep moving you from one slot
to another on this.
Secretary Mineta. And the Governor Thomas Carper Station in
Delaware as well.
Senator Sarbanes. Thank you.
Chairman Shelby. Senator Bunning.
Senator Bunning. Thank you, Mr. Chairman.
Secretary Mineta, let me get back to the original statement
I made. Do you share my concerns about rural transit needs, and
will you work with us to eliminate those concerns?
Secretary Mineta. Yes, sir. And SAFETEA really does reflect
an emphasis on the rural transit needs. As I recall, under
SAFETEA, as compared to TEA-21, the rural program is an 88
percent increase in rural formula programs, and so there is
recognition of what we have not been doing in rural transit in
the past, and we are trying to correct that in SAFETEA.
Senator Bunning. I know the overall increase, but how about
the ability to have the local governments match up in paying?
Secretary Mineta. These monies, of course, go to the State
and then they work with local governments. What we have done is
to increase the planning and technical assistance that can be
provided at the State level in order to strengthen not only the
State but also the local communities in terms of their own
planning capabilities, to make sure they get the ridership for
their local programs. But what we are trying to do is
strengthen the planning and just the capabilities at the State
and local level.
Senator Bunning. This question is kind of off the wall, so
you can pass it on to someone else or you can answer it.
Secretary Mineta. Ms. Dorn, if you would?
[Laughter.]
Senator Bunning. Last fall, Congress passed legislation to
arm airline pilots by very large margins both in the House and
in the Senate. Last week it was reported that only 44 pilots
out of a possible 60,000 have been armed. Many pilots believe
the TSA is trying to kill the program by foot dragging and
making the program burdensome. At the current rate you are
training pilots, it will take several hundreds of years to arm
them all. It is clear to me that we have not trained enough
pilots to have them be any type of deterrent. We have thousands
of commercial pilots who served in the military and many still
do. Yet the TSA has only been able to arm 44 of them. Do you
have any idea why there is such a delay in implementing the law
as it is written?
Secretary Mineta. First, as you know, the Transportation
Security Administration was transferred on March 1 to the
Department of Homeland Security. But prior to that transfer,
this program was initiated. Congress had provided no funding to
TSA, so we readjusted some monies and reallocated the financial
resources to go ahead and do this training of the initial 44
pilots who volunteered for this program, but there is no
funding.
Senator Bunning. Even in the new appropriation bills that
were passed in January?
Secretary Mineta. None of the supplemental appropriations.
Senator Bunning. No, not supplemental. I am talking about
the regular appropriations.
Secretary Mineta. The regular did not.
Senator Bunning. The Omnibus Appropriation Bill.
Secretary Mineta. I do not believe in the Omnibus it was
provided. I will check on that, because that was after March 1,
and I did not follow it in terms of the Omnibus Appropriations
Bill after March 1 when TSA got transferred to Homeland
Security. I can get that for the record and submit it to you.
(Information was not received in time for publication.)
Senator Bunning. Thank you very much.
Thank you, Mr. Chairman.
Chairman Shelby. Thank you.
Senator Reed.
Senator Reed. Thank you very much, Mr. Chairman, and thank
you, Secretary Mineta.
Senator Sarbanes mentioned we held eight hearings on
transit issues, and if I may give you a condensed summary of
what the findings are I believe. First, transit has been
extremely successful under ISTEA and TEA-21. Ridership has
increased. Systems have been renovated, rejuvenated, and all
across the country transit has taken on a new energy and a new
popularity. In addition, I think that there is increased demand
as a result for new transit systems and for increased funding
for existing transit systems. That is a result, not just of our
transportation policy, but also environmental policy. My
Director of Transportation in Rhode Island frankly told me
there is just no more room for highways in Rhode Island. If we
do not have complementary transit systems, if we do not have
remote satellite parking to put people into trains and the
buses, even if we had the money, we could not build more
highways.
That demand requires additional resources, and it is a
demand, as I suggested in my opening remarks, that is not
exclusive to any part of the country. Boise, Idaho, the mayor
testified about the need for transit in Boise. We have talked
about Salt Lake City. They were there testifying. Atlanta, Las
Vegas, Denver, and of course New York moves about 33 percent of
its people each day in mass transit; Boston. And those are
systems that have peculiar problems because of the age and the
need to continually renovate a very old system.
The other aspect that I could summarize is that local
transit authorities, both State transportation officials and
local authorities, need certainty and predictability in terms
of their planning. They need that for their own purposes. If
they are going to make a significant commitment of local
resources, they know the Federal Government will be there, not
just this year and next year, but in 5 and 10 years out,
because those are the scale or scope of these planning
processes.
And that brings me to the criticisms that you have heard
repeated here many, many times. Flatlining the transit budget
does not give a sense of certainty that these increased demands
will be met, that ultimately it will be robbing Peter to pay
Paul, and probably robbing Peter and Paul to pay somebody else,
given the fiscal situation of the United States. The end of the
guarantee, sent a strong signal that there may not be a lot of
certainty any longer. I know you indicated that transit is
popular, and we will find a way, but again, in a declining
fiscal situation with increasing deficits, such efforts might
not be successful. The increase of the transit match vis-a-vis
the highway match for New Starts sends exactly the wrong signal
to planners.
All of this, I think, has to be on the record. I think you
recognize it. You point out that this is an increase in terms
of size. Without inflation adjusted figures it might be, but
nevertheless, it is not just a question of absolute size. It is
a question of adequate resources for the demand, and everything
we heard in 8 Subcommittee hearings, everything you have heard
today, indicates that demand is increasing dramatically. Not
only is this satisfying just a popular demand, but also we will
never meet the goal of a comprehensive intermodal
transportation system that addresses the issues of pollution
and congestion unless we have vigorous investment in transit. I
know you know that, and I believe that you will be able to work
with us to correct some of these issues.
I do not want to ask any specific questions because the
questions have been raised and you have responded. I do not
want you to respond again. Let me turn to a specific issue, and
that is the lack of funding for identified transit security
issues. I understand that there is this new arrangement between
the Department of Homeland Security and your department, so you
might comment on that relationship, and also on what you
propose to do in terms of security issues for transit systems.
Secretary Mineta. One of the most extensive programs we
have probably undertaken through the great efforts of
Administrator Dorn is the work that she has done in conjunction
with APTA on getting to the districts or transit districts
about security concerns, and also not only transit districts,
but also first responders, and that has been, I think, a
program that we have aggressively undertaken, but maybe I will
have Ms. Dorn give more of the details of what she has done
with transit and security issues.
Administrator Dorn. Certainly. Mr. Chairman, I appreciate
your strong support for the efforts that we are undertaking at
the Department, and specifically at FTA. Early on Secretary
Mineta encouraged me, in partnership with the transit industry,
to be as aggressive as possible about conducting a series of
security assessments, which we did 37 security assessments
across the country in order to prioritize the risks and the
vulnerabilities. This helped the transit agencies understand
how they could best prioritize those risks and those
vulnerabilities, and to help the transit agencies to understand
how they could best prioritize those risks and those
vulnerabilities and put together emergency response plans.
The results of those efforts have been two-fold. Number
one, they have yielded really important outcomes for the
individual transit agencies, because as we have discussed
before, it is impossible to do a cookie cutter kind of approach
in terms of security. And number two, we have learned in terms
of our team of experts, some very important principles about
best practices that can be shared with the industry.
We also then are in the middle of doing technical
assistance follow-up teams. We identified some vulnerabilities
such as emergency response preparedness, and those sorts of
activities are being taken into account right now as we have
teams on the ground and will over the next year into 60 transit
agencies.
The Secretary mentioned our security forums in which we are
bringing the first-line responders together with the transit
agencies to make sure that those emergency response
preparedness plans are acted upon, and we have given
approximately 85 grants for drills for community-wide drills.
In the course of our work together, we have discovered that
the three most important principles of funding, in terms of
getting the most bang for the buck--and we did have limited
funding for this activity through the generosity of the
Administration and the Congress. We found the three most
important investments relate to transit employee training,
first-line supervisors, they know what to do and how to react,
and we have seen significant improvement across the board.
First, our transit agencies are safer than they have ever been,
and of course, as we have discussed before, because it is an
inherently open and accessible environment, we have a situation
that is difficult to address. Public awareness is the second.
We can have eyes and ears of our passengers, and they can plan
an important role, and many of our transit agencies have
partnered with not-for-profits and with other parts of cities
in order to make sure that that public awareness level is
increased. The third and final piece is the emergency response
preparedness and drilling against those plans.
Those are the three most important investment arenas in
which we think it is important to undertake real solid work.
We have worked very closely with the TSA, and now it, of
course, is in the Department of Homeland Security. They have
taken our risk assessment of the 37 top agencies, and they are
incorporating those in determining which and how grants should
be given to transit agencies. We have an ongoing, daily
partnership with Department of Homeland Security. And we
believe it is appropriate for them, in the position from which
they operate, to be able to determine what other prioritized
risk, is port security or another sector more important in
terms of those kinds of investments? So we believe that the
sharing of expertise continues and the responsibilities
appropriately allocated between FTA and TSA. We have a daily,
working relationship, and I am confident it will get even
better over the course of the months and years to come.
Senator Reed. Thank you.
Chairman Shelby. Senator Santorum.
Senator Santorum. Thank you, Mr. Chairman. I am going to
try to run down a few questions very quickly.
I think you have heard from the Committee as to our concern
about this 50/50 funding. I just have a question with respect
to your comments that a lot of transit organizations are trying
to jump ahead in the queue by going to better, more even
matches, 50/50 matches.
Could you provide me a list of those projects? I want to
see whether what I suggested in my earlier comments is true.
Are those smaller projects that are easier to fund, or are
these big, major projects that are being bid up? I suspect they
are probably not. I might be wrong, but I would like to see.
And if, in fact, they are smaller projects that are jumping
ahead in the queue, I think it proves the point that that is
what we are going to get more of.
Chairman Shelby. Senator Santorum, would you please yield?
Would you ask them to furnish that not only to you but also to
the entire Committee?
Senator Santorum. Yes, Mr. Chairman, I would be happy to.
Senator Sarbanes. Could I add a wrinkle on that? I think it
is important that we know whether it changed over time. Some of
these projects, they start out at 80/20, and then in order to
keep them moving or to expand them, once they have proven their
value to the local community, they are willing to do more. And
I think we need to know that as well.
You may have something that shows up at 60/40 in an
expansion, but its genesis was at 80/20. And if that is the
case, we need to know that as well.
Senator Santorum. I appreciate that additional request to
my request. Thank you.
A couple other things. First off, with respect to the Job
Access and Reverse Commute, my understanding is you are
proposing a formula for that. I have to just put my marker down
that I agree with my former Transit Administrator out of
Pittsburgh, Bill Millar, who has expressed concern that is
going to spread things a little bit too thinly from my
perspective and I think could have the impact of diminishing
the program's effectiveness. And I just want to make a comment
to that effect and suggest that that is something the Committee
needs to look at as to how we can best utilize those resources
in an area where it is going to maximize their efficiency.
A couple other things. I am also on the Finance Committee,
and there is a proposal floating around by Senator Grassley and
Senator Baucus with respect to transit bonding. Can you give me
the Administration's opinion on that proposal?
Secretary Mineta. We do not support that 2.86-cent
diversion at all and feel that the Grassley-Baucus, I believe
it is, approach should not be undertaken.
Senator Santorum. Thank you, Mr. Secretary.
One final comment. I am going to get off the transit
bandwagon here for a second. This is my only chance. I do not
sit on any of the relevant Committees on other issues regarding
transportation.
I come from Pennsylvania, a State that has more roads than
New York, New Jersey, and all of New England combined. And
there are proposals floating around saying that all States
should get in the new authorization 95 percent funding as a
minimum level of funding. I just want to suggest that, as a
State that basically connects the entire Northeastern part of
the United States to the rest of the country, certain States
are more important for interstate transportation than other
States; and that if we are going to go to a system that says
that everybody is going to basically get back what they put in,
what is the point of having a program that is supposed to be
modeled after improving efficiency for the entire country?
With that comment in advance, I would like to know what the
Administration's viewpoint is on a funding formula that would
require that all States get at least 95 percent of the money
they put into the system back?
Secretary Mineta. In SAFETEA, we have retained the
provisions of ISTEA of staying at 90.5 percent. Now, there is a
group called SHARE that is pushing for the 95 percent proposal.
That would add $6 billion to the Highway Program itself, and,
frankly, we do not know where that funding would come from.
Our $201 billion program is based on moving the 2.5-cent
ethanol tax that is now going into the General Fund, moving
that over to the Highway Trust Fund, and digging into the
resources of the unobligated balance in the Highway Trust Fund
in order to come up with the $201 billion program on the
highway side, which again, as I said and would reiterate, is
the largest highway program. But to get to 95 percent return
for every State is an additional $6 billion, and we just do not
have the resources to----
Senator Santorum. If you give me just an additional minute,
maybe I should ask the question a different way. Assuming we
could come up with $6 billion, would that be the best way to
spend it? I mean, that is really the question here. Congress
very well may come up with more money. My point is that if we
do come up with more money, is that the most efficient way to
spend that money to make sure that we are improving the road
network to provide better infrastructure for the interstate
transportation of goods in this country?
Secretary Mineta. Without having any other discussions with
OMB or Domestic Policy Council, but as a personal opinion, I
would say it would not be a good application of the resources.
Senator Santorum. I hope you weigh in with those other
agencies to express your opinion. Thank you.
Senator Sarbanes. Could I point out that to get
expeditiously from the North to the South along the Eastern
corridor in this country, you have to go through Maryland as
well.
[Laughter.]
Secretary Mineta. Maryland will get all the $6 billion.
[Laughter.]
Chairman Shelby. Senator Bennett.
STATEMENT OF SENATOR ROBERT F. BENNETT
Senator Bennett. Thank you, Mr. Chairman.
Senator Santorum asked my leading question about Grassley-
Baucus, and I am happy to hear you say that the Administration
is opposed to that.
A quick little bit of comment and history. When the
interstate highway system was first proposed, it was going to
be bonded. And Senator Harry Byrd from Virginia said, ``Roads,
yes, gentlemen. Bonds, no, gentlemen. We are going to pay for
this as we go.'' And the Highway Trust Fund was created and the
gas tax was created to see to it that we did not create bonds
but that we paid for this as we went along. And given that
history that goes back 50 years, I get nervous that people are
now talking about bonds to pay for transportation again.
We had a hearing in the Joint Economic Committee on
Transportation, and this is an oversimplification of the
subject that was discussed, but toll roads came up. And it was
a new vision of how toll roads, actually toll lanes, put market
forces into transportation, in that people would be willing to
pay a higher price to get on an express lane. In an emergency--
the evidence where it has been tried would indicate that it
wouldn't go to the rich in every instance, that people who have
an emergency have to get to a hospital, have to get to an
appointment, say it is worth the extra $2 or $3 that I would be
charged with a ``smart tag'' kind of collection system. And I
just pull into the lane and go there, and I know I am going to
be charged as I go past the various places, but it is worth it
to me. And others say I cannot afford that, and it is worth it
to me to take a little while longer to get to work, and that
would change the mix of highways pretty dramatically and
provide another source of funding. Going along with the
proposal for an increase in the gas tax, if you start talking
about the highest rate of expenditure ever for transit and
highways, we have got to have another source of funding
somewhere.
Have you looked into that kind of thing? And do you have
any opinion about it?
Secretary Mineta. And, in fact, in SAFETEA we allow HOV
lanes to be used for what is referred to as ``hot lanes.''
Senator Bennett. ``Hot lanes''--that is the name I could
not come up with. Thank you.
Secretary Mineta. And so that is a facet of our Highway
Program in SAFETEA that is new that we allow.
Senator Bennett. Have you done any studies as to how much
money that might raise? What contribution--I assume that would
all go into the Highway Trust Fund, or would that all go to
local----
Secretary Mineta. No. It would go to the local agencies
that are doing that, and probably the best example of that is
State Route 91 in California. But there are other agencies that
are now considering the idea of a hot lane. And the biggest
thing about the hot lane is how to identify whose car or what
car it is, and are they already registered as a prepaid
customer of the toll lanes so that they would then have their
account debited for being in the hot lane.
Senator Bennett. Thank you. One other question. We have a
vote and I recognize that. Would you consider in all of this
debate about 80/20, 50/50, et cetera, perhaps bifurcating
between New Starts and additional expansions. The experience in
Salt Lake City has been cited. I can tell you that there was
great opposition to light rail in Salt Lake in some sectors.
They were more vocal than they were numerical, but there was a
great expression of concern about ``snail rail,'' as they
called it.
I remember attending a political activity where I was the
only member of the elected delegation introduced to the crowd
who did not get an automatic standing ovation. And it was
because of my support for ``snail rail,'' and these people were
sufficiently opposed to it.
Once the North-South system was built, as Senator Sarbanes
has quoted, all of the opposition to ``snail rail''
disappeared, and suddenly everybody had been for it all along.
And everybody had thought what a wonderful idea it was all
along, like people now saying how great it is that Saddam
Hussein is no longer in power, never suggesting that they
wanted to keep him in power.
It was much easier to get the local match for the extension
of the system in the East-West fashion and then up to the
hospital at the University of Utah based on the success. And,
frankly, there was more money because we did better at the fare
box than any of
the initial projections had been, and we were able to pay a
higher percentage out of the fare box of the successful line in
the first
instance.
So you do not have to commit here on the record, but think
about the possibility of maintaining the 80/20 for a New Start,
and then saying once you have achieved a certain level of
success, then the local community will be asked to come up with
50 percent, or something of that kind, if they want to expand
it.
Secretary Mineta. Well, the 50/50 is only applicable to the
New Starts Program, and the 80/20 is there for the rest of the
program in public transit. So that 50 percent is only as it
applies to the New Starts Program.
Senator Bennett. I am suggesting that you might think about
flipping that.
Secretary Mineta. I understand.
Senator Bennett. Because it is much easier to raise money
on the basis of success than if you just have a concept that
you are trying to sell an electorate that doesn't want to come
up with the 20 percent.
Secretary Mineta. And in these other projects, we do have
incentives for increased ridership to the local transit
district, because we want to give them incentives as well to
improve their own service to their localities.
Senator Bennett. I just have to make the clear point on the
record that FTA/DOT has been fabulous to work with, that we in
Salt Lake City have been tremendously benefited by the
expertise of your agency. That preceded your coming in, but it
has continued in the period that you have been in charge, and I
shouldn't leave the opportunity without getting that statement
clearly on the record and thanking you for all your help.
Secretary Mineta. Well, it was, without a doubt, your
service at the Department of Transportation that set the pace
for all of us who are there today.
Chairman Shelby. Mr. Secretary, that was quite a few years
back now.
Secretary Mineta. Yes, indeed.
[Laughter.]
Senator Bennett. The first Assistant Secretary of
Intergovernmental Affairs.
Chairman Shelby. Senator Carper. I know we have a vote, but
go ahead.
Senator Carper. Thanks very much.
Mr. Secretary, Administrator Dorn, I am pleased to hear you
indicate that you do not find favor in the proposal put forth
by Senators Baucus and Grassley with respect to a bonding
approach for funding transit. I think that is a symptom, and it
is a symptom of a bigger problem, and the bigger problem is
there aren't enough resources that are available to be
committed over the next 6 years for highways or for transit.
And I appreciate your statements that this is more money than
you have ever allocated before for ISTEA or for TEA-21. But I
think when we actually adjust for inflation and for changes in
demographics, we find that the resources are inadequate, and as
a result, we see proposals well-intended but ultimately, I
think, not very helpful that the likes of which Senators Baucus
and Grassley have put forward.
I do not want to get Administrator Dorn in any trouble
today. I do want to come back--and you have heard us visit and
revisit this funding question for New Starts, whether it should
be 80/20, 50/50. And I have a note here that Administrator Dorn
may have said something to the effect of this, and just correct
me if I am wrong. But if we are going to pursue a policy that
high demand for Federal funding should dictate a lower Federal
share, we should apply that to highway programs as well. And I
think you may have said that in one of our hearings. I am not
trying to put words in your mouth or to get you into trouble.
But if you ever said or thought that, I just want to say I
agree.
Chairman Shelby. Thank you.
Mr. Secretary, you and Administrator Dorn have been very,
very patient.
We will continue to hold hearings on transit because it is
so important, as Senator Sarbanes pointed out. We thank you for
your appearance today.
We have a second panel, and we will get into the second
panel as soon as we vote and come back.
Secretary Mineta. Thank you very much, Mr. Chairman.
Chairman Shelby. Thank you, Mr. Secretary.
[Recess.]
Chairman Shelby. The hearing will come back to order.
Our second panel today includes William Millar, President,
American Public Transportation Association; Jeff Morales,
Director, California Department of Transportation, who will
testify on behalf of the American Association of State Highway
and Transportation Officials; Robert Molofsky, General Counsel,
Amalgamated Transit Union; Harry W. Blunt, President, Concord
Coach Lines, Concord, New Hampshire, testifying on behalf of
the American Bus Association; and Jim Seal, a Federal Transit
Administration consultant.
We welcome all of you here. All of your written statements
will be made part of the record, and in the interest of time,
if you would briefly sum up your remarks, please.
Mr. Millar, we will go with you first.
STATEMENT OF WILLIAM MILLAR
PRESIDENT, AMERICAN PUBLIC
TRANSPORTATION ASSOCIATION
Mr. Millar. Thank you very much, Mr. Chairman, and thank
you for inviting us to the hearing today.
Having heard the opening statements of all the Members and
the subsequent concerns of the Secretary, I am almost inclined
to just say ``Thank you'' and leave it at that, but I do have
just a couple of things that I would like to add.
I certainly want to thank you for the role that you and the
Committee have had in crafting TEA-21. The good news is that--
and apparently, all the Members who are here today spoke to
it--TEA-21 works. We have seen an unprecedented level of
investment in transit; the public has responded with an
unprecedented growth in the usage, and therefore, we believe
that this reauthorization should be evolutionary in nature, not
revolutionary.
Chairman Shelby. So we need more money.
Mr. Millar. Yes, sir, we do. And we appreciate the
leadership that you and the Committee have shown in trying to
figure out the best way to get more money, and we especially
appreciate the letter that you sent to the leaders of the
Finance Committee expressing concern about the bonding
proposal.
We too share that concern. We do not believe that taking
funds from the Mass Transit Account to fund the highway program
and then trying some other way to put money in there is the
right way to go, and we thank you very much for your leadership
and the leadership of all the Committee leaders in that regard.
As I comment on SAFETEA, let me organize it around the
three basic principles that I have testified to this Committee
and the Subcommittee earlier: Grow the program, protect the
guarantees, and improve the program delivery.
First, with growing the program, as all of you said earlier
today, we simply need to have a higher level of investment.
APTA has proposed doubling the size of the investment over the
next several years. As was pointed out, the Administration's
own numbers as well as work done by my colleagues at AASHTO, as
well as independent economic analyses, all show we should be
spending tens of billions of dollars more on public transit
every year than we are.
We need to see more investment, not less, and as was very
clearly pointed out by the Members this morning, the SAFETEA
proposal does not meet that standard.
Second, we would like to see the funding guarantees
maintained. They have been a great boon. They have brought
predictability to the program, they have provided certainty so
that major projects can go to Wall Street, get private
financing to speed up the projects, to bring them in in shorter
time and with more benefit. Without the funding guarantees,
that goes away.
APTA did do a study in the last year on the benefits of the
funding guarantees, and with your permission, sir, I would like
to insert that in the record.
Chairman Shelby. We will make that apart of the record
along with your testimony.
Mr. Millar. Thank you very much. We also have worked with
our colleagues in the transportation construction industry and
in the highway construction industry, and we have also
completed a study by the firm of Global Insight* that outlines
the stimulative effect and the good economic benefits of
investments.
---------------------------------------------------------------------------
* Held in Committee files.
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Mr. Millar. It should be pointed out particularly in this
Committee that it was at the insistence of the bipartisan
leadership of this Committee in 1998 that the General Funds for
the program were included in the guarantees when others would
have proposed simply the trust fund. So again, we thank you for
that work then, and we thank you for your continued support
today.
Finally, with regard to the improvements in program
delivery, our reauthorization proposal, which I previously
submitted to the Committee, carries 40 pages worth of ideas on
how we might speed up program delivery. We certainly appreciate
that the Administration wishes in some ways to improve the
efficiency of the program and the distribution of the funds of
the program, but we do not think a major overhaul such as they
have proposed is appropriate.
We also believe that if there are to be major changes in
the structure of the program, that should only be done with new
growth in the program. That way, we avoid taking away from the
existing program successes--for example, those that Senator
Santorum pointed out in his State. That way, we avoid
shortcutting those successes while we do meet priorities that
have to be met--for example, more money for rural public
transportation.
In APTA's proposal, the largest single category of increase
that we propose, some 110 percent increase, would go into rural
and small urban transportation. We have additional proposals
there for high intensity use, small urban systems and
additional proposals for bus replacement and van replacement
throughout those areas.
To conclude, we certainly share the Committee's expressed
view this morning--we can see no good policy reason to
differentiate between New Starts, Federal match, and any other
part of the program. We would strongly urge that we maintain
the New Starts Federal share at 80 percent.
Let me close by saying thank you, Mr. Chairman, thanks to
all the Committee, and we look forward to your questions.
Chairman Shelby. Thank you.
Mr. Morales.
STATEMENT OF JEFF MORALES
DIRECTOR, CALIFORNIA DEPARTMENT OF TRANSPORTATION
ON BEHALF OF THE AMERICAN ASSOCIATION OF
STATE HIGHWAY AND TRANSPORTATION OFFICIALS
Mr. Morales. Thank you, Mr. Chairman.
I appreciate the leadership that you and Senator Sarbanes
are showing on this issue and moving forward, and we certainly
look forward to working with you as the process goes forward.
I will start by agreeing with the basic premise here, which
is that the transit provisions of TEA-21 are working well and
should be continued. Clearly, the funding must grow.
AASHTO has proposed that the transit program be funded at
$7.5 billion in 2004, increasing to at least $11 billion in
2009. We also support the higher APTA-recommended level that
would rise to $14 billion, assuming that that funding can be
provided as net growth and not come at the expense of other
programs.
The Administration's proposed funding levels for transit
fall substantially short of its own documented needs, based on
the Conditions and Performance Report. Under SAFETEA, transit
funding would grow only from $7.2 billion to $8.1 billion,
which would represent $1.1 billion below the funding level for
2003, when adjusted.
AASHTO is concerned that the SAFETEA proposal, while
guaranteeing funds for the mass transit account, contains no
similar guarantee for the General Fund component of transit
funding. State and transit agencies need stable, predictable
funding in order to construct major transit projects. It is
very critical that both the Highway Trust Fund and the General
Funds for transit are guaranteed in reauthorization.
I would join, I believe everyone here today in also saying
we do not support the proposed reduction of funding for New
Start projects from 80 percent to 50 percent. There is no clear
policy basis for doing so, and I would add that certainly in
California's case, we do overmatch on many projects, both in
transit and in the highway program, which has not been
discussed today, but we do so on a project-by-project basis,
based on what makes the most sense. There is really no basis
for making an arbitrary, across-the-board reduction in the
amount of Federal funds that could go to a given project.
One of the major moves in ISTEA and carried forward in TEA-
21 was enhancing and strengthening the local planning process,
and we should not as a matter of policy restrict that process
by making this change.
AASHTO commends the Administration for their concern with
the solvency of the mass transit account but does not support
the proposed program restructuring. SAFETEA proposes that New
Starts be funded entirely with General Funds rather than
through the Highway Trust Fund. Since General Funds would not
be guaranteed under the Administration proposal, New Starts
would be vulnerable to funding reductions or elimination even
during the annual appropriations process.
Also under SAFETEA, the bus discretionary funding would be
eliminated, and the Rail Modernization Program would be shifted
to the formula program.
Other alternatives exist to remedy the budget-scoring
problems which prompted these proposals, and we would be glad
to work with the Committee to find solutions.
There are several aspects of the Administration's proposal
that AASHTO supports, including the elimination of some
burdensome Buy America certification requirements for smaller
transit systems. We do not support an exemption from Buy
America but simply a streamlining of some of the administrative
burdens placed on them.
We support expediting transportation improvements by
allowing planning studies to establish the basis for an
environmental assessment or impact statement under NEPA in
continuation of the TIFIA Program, with a threshold of $50
million, although we would actually recommend that that be
reduced to $25 million.
AASHTO also supports the continuation of the State
Infrastructure Bank Program and recommends that it be open to
all 50 States.
Rural transit needs have been discussed here today, and I
would note that AASHTO's ``Bottom Line'' report documents the
need to double Federal rural transit assistance from the
current levels, and we support SAFETEA's recommendation for
increased funding. As the Nation's elderly population increases
in the coming years, citizens in rural areas will need access
to shopping, medical, and other services.
With regard to the transit bonding proposal that has been
discussed, AASHTO has joined APTA and other organizations in
expressing support of maintaining the existing structure, and I
too want to join in thanking both you, Mr. Chairman, and the
Ranking Member for taking a leadership role and raising
concerns about this and pushing to continue their current
growth.
One of the most important advances of both ISTEA and TEA-21
was the integration of the modes, and this reauthorization
should continue that trend and not reverse it. The challenge
before you is obviously how to meet the growing transit needs
in this Nation as we go forward. AASHTO has identified a menu
of options that would grow the program to the levels that we
have proposed. We believe that through these mechanisms,
program levels of at least $55 billion for transit and $300
billion overall for the program are achievable and would
certainly be consistent with the Senate Bud-
get Resolution in this area.
Mr. Chairman, we look forward to working with you as this
process goes forward.
Thank you.
Chairman Shelby. Thank you.
Mr. Molofsky.
STATEMENT OF ROBERT MOLOFSKY
GENERAL COUNSEL, AMALGAMATED TRANSIT UNION
Mr. Molofsky. Thank you very much, Mr. Chairman and Senator
Sarbanes.
For more than 40 years, the Amalgamated Transit Union, now
numbering over 180,000 members in 46 States, has been a partner
along with the transit industry and others who are appearing
before you today in helping to design and shape America's
transportation program.
Since 1964, with the first bill, this Congress--every
Congress--and, we believe, this Administration, has understood
properly that sound national transportation policy requires
with it a sound national transportation labor policy. It is
that partnership between transportation, labor, and industry in
the communities in which our members live and serve that we
believe have been the cornerstone for the development of
strong, well-funded, well-implemented, and well-operated
transit services from the start of the program back in the
early 1960's to the present.
We have previously submitted to the Committee a very
comprehensive proposal regarding TEA-21 reauthorization. It is
entitled, ``Next Stop--Real Choices: Moving America Safely.''
And it is those principles captured in the title of our
proposal that we brought our review of the Administration's
proposal to make sure that at every step in our review, funding
was appropriate to make sure that the Nation's services were
maintained and expanded as needed, that the service was secure,
and that it was safe.
In looking at the Administration's bill, we too share, like
others before you, concerns with the funding levels. Simply
stated, there is not enough money in this bill to provide for
the necessary transit services and to do it the right way in
all communities, rural and urban alike, and to make sure it is
safe and secure.
We share the concerns of yourselves and others on the
Committee with respect to the funding levels, the focus on
guarantees as opposed to the proposed numbers without
guarantees, which is an artificial way of describing the bill
by not pointing out the real dollars that would ultimately
flow. The changes that have been proposed in the Bus Capital
Program and the JARC Program to formularize it as opposed to
allocate it, we disagree with, and also the restructuring,
which includes the JARC Program.
Looking at the Administration's bill, we do believe it is a
sound platform upon which to go forward. It recognizes that we
are well beyond the debate of linking highways and transit in
both the planning and operating programs, and it does seek to
address some of our pressing security needs.
I would like to mention and highlight several program
issues that we have set forth in our proposal that can enhance
the concerns, both funding and safety and security, which have
come up today.
I might say, Mr. Chairman, that when I joined the ATU in
the early 1980's, one of my first trips was to Alabama to see
if the State legislature could approve and extend the beer tax,
which at that time was funding transit in Birmingham. We did
not get it, but it does underscore ATU's interest, transit,
labor, and the communities in which we live, the need to have a
strong opportunity to lobby and secure State funding along with
the Federal dollars that are put forth. And for that reason, we
have proposed a so-called FIG Program, or Federal Incentive
Grant Program, that would seek to provide incentives to States
based on their ability to secure increases in State dollars for
transit, and we have a menu of incentive grant dollars that
would flow depending on whether they increased funding, created
new sources of funding or, most significantly, opened up their
existing trust funds which dating back to the 1930's, were
dedicated for highway projects only, without an ability to be
used for transit projects.
We believe there should be a strong voice and a dedicated
representative serving on the State and local MPOs, involving
all constituent groups that benefit from transit services.
In the security area, we have identified a number of
initiatives that we think are vital and critical to making sure
our systems are safe. It is not enough to do surveys and
develop best practices; there needs to be money, and there
needs to be a requirement that every, single transit property
develop safety and security plans and provide training--and,
with all due respect, not just to first-line supervisors but to
those who are on the street when problems arise, and that is
the operating personnel and those who operate and maintain the
services.
We support the Parks Expansion Program and the proposals by
CTA, APTA, and others for expansion in the rural areas.
I would like to just close with several comments on three
additional programs. One, we think there should be a targeted
program for workforce training. Technology has brought this
industry far along, from the horsedrawn cars to the kinds of
equipment in place today. There needs to be a dedicated
targeted program to provide transit systems with funds to train
the workforce. It is a security issue, it is a service issue,
it is a safety issue.
Two, if ridership is of concern, as it is to everybody, we
think there should be an increase in the commuter benefit tax
from 100 to 190. S. 661 has been offered, and we support it.
Third, we think the charter regulations which have been in
place since the mid-1980's make no sense. They are burdensome
and complex. I do not think they continue today to address the
real-world issues that confront us today in our communities. In
effect, they limit almost to the point of absurdity the ability
of public systems to provide limited services to the nonprofits
and government agencies who might need those services on a
limited basis. We know the private sector has some real
concerns about it, and I believe that with this Committee's
support, we can, through discussions with those
representatives, develop a better system that is less
adversarial and provides more certainty to all parties,
enabling them to provide the services that are needed.
Finally, we will be prepared as always to answer any
questions you may have.
Thank you very much.
Chairman Shelby. Thank you.
Mr. Blunt.
STATEMENT OF HARRY W. (WOODY) BLUNT, JR.
PRESIDENT, CONCORD COACH LINES
CONCORD, NEW HAMPSHIRE
ON BEHALF OF THE AMERICAN BUS ASSOCIATION
Mr. Blunt. Thank you, Senator Shelby, Senator Sarbanes.
Intercity buses carry 774 million passengers each year and,
unlike other modes, we do it with minimal Government subsidy.
We transport more people in 2 weeks than Amtrak carries in an
entire year. Scheduled intercity buses serve 5,000 communities
daily, compared to 521 served by Amtrak and 536 served by the
airlines.
Chairman Shelby. Say that again, please.
Mr. Blunt. Intercity buses serve 5,000 communities across
America on a daily basis. Amtrak services 521 cities, and the
commercial airline industry services 536.
Chairman Shelby. And what about the number of passengers
relative to all those?
Mr. Blunt. Seven hundred seventy-four million passengers; I
believe Amtrak carries about 30 million passengers, and the
airline industry, in the range of 600 million passengers
annually. It was 600 million and growing, but obviously, it is
pretty stable now.
A Nathan Associates report* shows that from 1960 to 2001,
Amtrak received a total net Federal subsidy of $57.96 per
passenger carried. Commercial airlines received $6.07 per
passenger carried. But intercity, regular-route, scheduled
passengers received only 8 cents per passenger in Federal
subsidies.
---------------------------------------------------------------------------
* Held in Committee files.
---------------------------------------------------------------------------
We applaud the Administration's SAFETEA proposal. It is a
great first start, and the proposal begins to recognize the
potential of intercity bus. But we do have a couple of
recommendations.
SAFETEA continues the ADA Wheelchair Lift Program for
intercity buses, providing $7 million in funding for private
operators. But with the annual cost estimated by the TRB to be
closer to $40 million, $7 million just is not enough.
SAFETEA includes a first-ever Intermodal Passenger
Facilities Grant Program that helps to build facilities and
ensure coordination between intercity bus and other modes. This
is an essential. People should not have to go to another part
of town, or the wrong part of town, to get on a Greyhound or
Trailways bus.
Our industry at times has been given a bad reputation
because of cities not providing good terminals. This city,
Washington, DC, is a classic example of that, with a beautiful
train station, and the bus terminal relegated to a poorer part
of town.
SAFETEA also provides more funding for rural, over-the-road
bus programs, which help to restore service to rural
communities that often have no other form of public
transportation. However, we are concerned that States could
choose to divert those funds. DOT failed to propose in its
reauthorization program an essential bus service system for
service between nonurbanized areas and hub airports and
secondary airports. We believe that this would be a good
alternative in some cases to essential air service.
However, on the top of our list in reauthorization is the
subject of transit competition. It simply does not make sense
to use transit buses subsidized by Federal tax dollars to
conduct a sightseeing service or to ferry people to golf
outings. There are thousands of private intercity operators to
perform that service. It is akin to asking the local fire
department workers to paint houses because they already own
ladders and have ladder trucks that are quite often not being
used.
In a nutshell, these are our concerns. FTA refuses to fine
transit agencies in violation of the present law. The FTA is
conflicted to both fund and also regulate transit
organizations.
DOT proposed a new loophole under SAFETEA that will allow
transit charters if they provide service to the elderly. The
elderly are 50 percent of the private sector charter market,
and transits now want to, as my colleague has mentioned, gut
the regulation entirely. We cannot compete with these heavily
subsidized agencies when the deck is stacked against us.
In closing, Mr. Chairman, I would like to take a moment to
tell you about a letter that I have had on my desk for 17
years, a wonderfully simplistic letter from a third grade class
that went on a bus ride to connect to a plane ride. This was a
very special plane and bus ride, because the mom of one of the
children on this bus had arranged the trip to go to Florida and
the Kennedy Space Center so that the class could watch that
mom, Christa McAuliffe, become the first teacher in space on
the Challenger shuttle.
Tragically, this letter was written in the days that
followed the Challenger disaster, but it brings to total
clarity what we talk about here today. This Nation is about
discovery and exploration and human experience, good and bad.
Our mobility allows us to discover and explore all facets of
our transportation system, from a bus to a plane to a rocket,
and represents an important link in that transportation and
that mobility. The links of the chain make us strong as a
Nation, but we need all of those links, and none can be
ignored.
Thank you, and I will be glad to answer questions.
Chairman Shelby. Mr. Seal, we have another vote and what
after that, we are not sure, on the floor. Can you sum up in a
couple minutes?
STATEMENT OF JIM SEAL
FORMER CONSULTANT, FEDERAL TRANSIT ADMINISTRATION
Mr. Seal. Sure. Thank you, Mr. Chairman.
I was a consultant to FTA in the 1980's on public-private
partnerships. I am not representing FTA today.
I wanted to point out that the proposed SAFETEA legislation
does move forward by putting the emphasis on the individual
customer, and this will go a long way toward an outcome-based
Government. It recognizes that nonincentive-based Government
cannot always achieve policy outcomes.
The proposed legislation recognizes that we can achieve
congestion relief with the scarce use of resources proposed,
and we understand that budget growth is important but not only
relying on budget growth. And I think the centerpiece of that
is certainly the incentive program, which can go a long way
toward reducing congestion and providing cost-effective
services.
We also applaud including other parties and other providers
as grant recipients in the new planning stage, and this will
bring forward new, innovative transportation programs.
In California, we have a contrast of those who rely on
competition and those who are more centrally oriented. In San
Diego, I would like to report that from 1979 to 2001, in
inflation-adjusted costs, San Diego Transit has reduced its
costs by 34 percent. In Santa Clara County, the opposite has
taken place, where costs have increased by 18 percent after
adjusting for inflation--and this does have an impact on
transit. The more cost-effective it is, the more service can be
provided.
We believe that as many barriers as can be eliminated to
provide service cost-effectively is the way to go, one area
being the labor protection, 13(c). Certainly, it was called for
when there were no State labor bargaining rights. Today, to use
that to expand into the JARC and the Administration's New
Freedom Initiative would stifle innovation, and by definition,
this is new service, and new service has no impact on existing
employees. This should be taken into consideration in the
legislation.
Thank you very much.
Chairman Shelby. Gentlemen, we appreciate all of your
testimony, and we hate to hurry like this. I have a number of
questions for the record for all of you, and I am sure Senator
Sarbanes and others might have questions as well. We will get
those to you as soon as possible.
We appreciate your participation. I think we are hearing
you loud and clear today, and we thank you very much for
appearing.
The hearing is adjourned.
[Whereupon, at 12:35 p.m., the hearing was adjourned.]
[Prepared statements, responses to written questions, and
additional material supplied for the record follow:]
PREPARED STATEMENT OF SENATOR JON S. CORZINE
Mr. Chairman, thank you for calling this hearing to discuss the
Administration's proposal for the reauthorization of TEA-21 known as
the Safe, Accountable, Flexible, and Efficient Transportation Equity
Act, or SAFETEA. I welcome Secretary Mineta as well as the other
witnesses appearing before the Committee today and look forward to
their testimony.
Mr. Chairman, I have strong doubts that SAFETEA will be sufficient
to meet the needs facing our Nation's mass transit infrastructure. The
challenges posed by increased ridership and an aging rail and bridge
network require a strong level of financial commitment from the Federal
Government. Unfortunately, I cannot find that level of commitment in
this proposal.
SAFETEA proposes $45.7 billion in mass transit spending over the
next 6 years. I believe that this is an inadequate amount. It
represents a 1.2 percent cut from the amounts authorized under TEA-21,
when adjusted for inflation. And it falls well below the $56.5 billion
that the Senate included in its budget resolution that passed Congress
in the spring.
Mr. Chairman, in the 2002 ``Conditions and Performance Report,''
the Department of Transportation reported that we need an annual total
investment from Federal, State, and local governments of $14.84 billion
in transit to maintain conditions and performance at current levels and
$20.62 billion to improve both conditions and performance. The only way
to do this, under the Administration's proposal, is to pass the costs
on to our cash-strapped States and municipalities. I do not believe
that we should do this.
In addition, I am concerned about the Administration's proposal to
eliminate the minimum guarantee of mass transit funding that comes from
general revenue. This proposal would remove the guarantee that protects
the General Fund portion of the transit program and leave this amount
subject to the appropriations process. In today's tight appropriations
environment, I am concerned Congress will be unwilling or unable to
make up the difference between the authorized and guaranteed levels.
Finally, I would like to address the Administration's proposal as
it relates to the New Starts Program. First of all, I do not believe
that we should eliminate the Bus Discretionary program in order to help
pay for the New Starts Program. If we do so, we are robbing Peter to
pay Paul. But I am also deeply opposed to any proposal that would cap
New Starts Federal funding at 50 percent, instead of the current 80-20
Federal-State split. We do not make the same requirement of highway
funding and I believe that if we enact this proposal, we will encourage
States to choose highway projects over mass transit projects.
Mr. Chairman, my own State of New Jersey is the second largest
recipient of New Starts money in the Nation. The New Starts Program
funds the ongoing Newark-Elizabeth and Hudson-Bergen light rail
projects. These projects will need funding during the life of the next
TEA-21 legislation. In addition, I will be seeking funding to help
construct a new rail tunnel under the Hudson River. I can tell the
Committee that changing the Federal/State split will place a huge
burden on New Jersey to find additional funding for these worthy
projects.
Mr. Chairman, I look forward to working with the Committee and the
Administration to create better legislation that will meet our Nation's
transit needs. Thank you very much.
----------
PREPARED STATEMENT OF SENATOR DEBBIE STABENOW
Mr. Chairman, thank you for holding this hearing on the
Administration's SAFETEA proposal.
Ensuring safe and efficient public transportation is one of the
most critical issues that we face as Members of this Committee. I look
forward to working with the Chairman, and all Members of this
Committee, as we craft a strong mass transit title to the upcoming TEA-
21 reauthorization this year.
Michigan is known as an automobile State. We take pride in
producing and driving our cars. However, Michigan also has tremendous
mass transit needs. In the year 2002 alone, Michigan buses carried over
88 million passengers.
There are bus systems operating in every one of Michigan's 83
counties, from the urban Wayne County to rural counties in the Upper
Peninsula. Despite covering all counties, service in many areas is
minimal, creating a real hardship for working families who cannot
afford to own a car.
Last month, a Detroit News series chronicled how underfunded
transit systems impact working famities. The article followed Detroiter
Karen Gholston, who stands at the bus stop every morning at 3:30 a.m.
with her two-year-old daughter in one hand and a can of pepper spray in
the other, waiting to catch a bus for her 6 a.m. class.
Despite the fact that her class is only 12 miles away, it takes
Karen two and a half hours to get there because the bus only runs once
an hour, and is often late or does not come at all.
Being late too often could cost Karen a spot in the pre-engineering
program at Focus:HOPE, ending her dream of escaping from her $400-a-
month Government assistance by becoming a mechanical engineer for an
auto company. How can we expect working mothers to become independent
from Government assistance programs when we do not provide adequate
public transportation to get them to their jobs and classes?
Mass transit plays a critical role in Michigan's economy, not only
by creating thousands of jobs, but also by providing critical services
for Michiganders who cannot afford to own a car. For example, 78
percent of jobs in metro Detroit are 10 miles or more from downtown,
more than twice the national average, making public transit critical
for working families.
Given Michigan's and the Nation's growing transit needs, I have
serious concerns about the Administration's SAFETEA proposal.
First, SAFETEA not only fails to grow the transit program, but it
also in effect cuts funding from the prior TEA-21 authorization bill.
TEA-21 provided $36 billion in guaranteed funding over a 6-year period,
which was a 50 percent increase over the $24 billion actually
appropriated under the prior ISTEA authorization.
However, the Administration's proposal only provides $37.6 billion
in guaranteed funding, which is a 7.6 percent cut from TEA-21's
guaranteed funding level when adjusted for inflation.
The SAFETEA proposal also eliminates the guaranteed funding for the
General Fund portion of the transit program. Currently, 20 percent of
the mass transit program is funded from the General Fund and this
entire amount is guaranteed for transit funding. SAFETEA eliminates
this funding guarantee, forcing transit to compete for 20 percent of
its funding in a very tight and difficult budget.
Finally, the Administration's proposal eliminates the 5309 Bus
Discretionary program. As a representative of a State that relies
solely on bus systems for its public transit needs, I find this
particularly alarming.
According to the Michigan Department of Transportation (MDOT),
Michigan's estimated transit capital and operating needs total nearly
$1.5 billion over the next 6 years, and much of this capital investment
is needed to simply keep up existing service even though ridership is
increasing.
Under TEA-21, Michigan received over $124 million under the 5309
Bus Discretionary program, but our capital needs for buses, facilities,
and equipment exceeded $600 million for that same time period.
This shortfall exists despite the significant contribution by
Michigan taxpayers. Michigan ranks 6th, behind five States with rail,
in direct support for its public transit systems.
Eliminating the Bus Discretionary program, will assure that
Michigan will fall further and further behind in meeting its public
transit needs. Michigan, already ranks last in Federal transit funding
among the Great Lakes States, and only receives 43 cents back on every
transit dollar it contributes to the highway trust fund.
I am pleased to be here today as we begin our work on improving our
mass transit programs. I hope to be able to work with my colleagues on
this Committee to help States like Michigan, increase access to public
transportation, which will improve our economy and our quality of life.
Thank you.
----------
PREPARED STATEMENT OF SENATOR ZELL MILLER
I appreciate Chairman Shelby and Senator Sarbanes for organizing
today's hearing to discuss the public transit aspects of the
Administration's proposal SAFETEA--Safe, Accountable, Flexible, and
Efficient Transportation Equity Act. The current highway and transit
legislation, TEA-21, expires September 30 of this year. Today's hearing
is timely and the issues are important to the people of Georgia and
this Nation.
During TEA-21, Georgia received about $777 million for transit over
the past 6 years. The Administration proposal provides $45.76 billion
for transit over the next 6 years and $37.6 billion in guaranteed
funding. But the ridership has outpaced the available resources and the
need for the efficient transportation is still unmet.
As a former Governor during the inception of the Intermodal Surface
Transportation Efficiency Act (ISTEA) in 1991 and TEA-21 in 1998, I
know well the benefits and importance of a long-term, holistic approach
to addressing the numerous transportation challenges of large
metropolitan, nonattainment areas as well as rural areas in need of
alternatives to safely and efficiently transport people to and from
work, school, grocery stores, and medical centers. With the need
outpacing the current resources, I look forward to Secretary Mineta's
and the other witnesses' testimony about the funding levels in SAFETEA
and retaining important flexibility, minimum guarantees, and firewalls
that State transportation planning organizations currently enjoy.
----------
PREPARED STATEMENT OF SENATOR RICK SANTORUM
Thank you, Mr. Chairman, for holding this hearing on the
reauthorization of the Transportation Equity Act for the 21st Century
and hearing testimony on the Administration's proposed Safe,
Accountable, Flexible, and Efficient Transportation Equity Act
(SAFETEA).
When it comes to transit, I come from a State that has it all.
Pennsylvania has small transit operators running bus service in rural
north central Pennsylvania as well as the large systems in Pittsburgh
and Philadelphia that include existing rail and New Start proposals. I
have medium-size operators in at least one small urban area that is
considered high-intensity for transit. My State also has a large
population of seniors.
As one of those responsible for the creation of the Job Access and
Reverse Commute program in TEA-21, I am interested in the impact of
proposed changes to the administration of the program contained in the
Administration's SAFETEA proposal. I am skeptical about the proposed
formularization of the program and take very seriously concerns that
formularization will spread the program's resources too thinly and
undermine JARC's effectiveness. During my tenure in Congress, I have
been active in Congressional efforts to reform welfare and assist
recipients in transi-
tioning from welfare to work. The JARC program has been a critical tool
in assisting families in that transition. I will work to ensure that
JARC remains an effective program that complements other Federal
efforts to help build independence for more of our citizens.
I am also interested in how the Administration proposes to provide
better transit service to our constituents by improving coordination
among different providers of transit and other social services as well
as proposed incentive programs.
I note with particular concern the Administration's proposal to
reduce the New Starts Federal match from the current ratio of 80
percent Federal, 20 percent nonFederal to 50/50. Not only does this
recreate the gap that was intentionally closed in previous Federal
transportation laws between highway and transit matching fund levels, I
fear that the proposed 50/50 match will discourage large and
potentially beneficial projects. You could well have a situation where
larger projects that have the ability to really transform communities
will take a back seat to minimalist projects that require less non-
Federal share money. The 50/50 proposal would also have a negative
impact on my State.
As Congress and the Administration work to provide an adequate
level of funding to our transportation needs, I have also been made
aware of concerns regarding a proposal circulating in Congress for
changing the financing system for transit. The proposal currently being
referred to as Grassley-Baucus would in many ways shift the financing
for transit to a bonding system. There is a real concern about breaking
with the current system that funds transit and highways for the most
part from Federal gas taxes. As a Member of both the Finance and
Banking Committees, I intend to work to ensure that any system used to
finance our transportation projects preserves the best aspects of,
current transportation law, including equitable treatment for transit
and the multiyear reliability of funding so crucial to effective long-
term planning.
I look forward to hearing the testimony of today's witnesses.
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PREPARED STATEMENT OF SENATOR JACK REED
Mr. Chairman, I want to join you in welcoming Secretary Mineta and
our other witnesses to today's hearing on the reauthorization of TEA-
21.
I am pleased to have a chance to discuss the Bush Administration's
TEA-21 proposal and get the input of transit operators, employees, and
riders.
This hearing is proof that transit is a mainstream issue because
transit is the fastest growing mode of transportation, and, in no small
measure, transit is now vital to cities like Denver, Salt Lake City,
Dallas, Atlanta, Miami, and Charlotte that previously never cared about
buses or light rail.
While I have some strong disagreements with the SAFETEA proposal
put forth by the Administration, I want to thank the Secretary for his
leadership in preserving the four-to-one balance between highways and
transit, maintaining transit is share of the Federal gas tax and
preserving the flexibility of TEA-21. Indeed, this bill continues his
longstanding support for a balanced, national, intermodal
transportation policy.
However, I continue to have three major concerns with the
Administration's bill: (1) the failure to provide new resources for
transit, and even highway improvements for that matter, (2) the failure
of SAFETEA to guarantee transit funding, and (3) the failure of SAFETEA
to offer specific funding for transit security needs. On this last
point, I am particularly concerned that OMB chose to ignore these
needs, particularly in light of the Sarbanes-Reed GAO report which
found that just 8 transit properties estimated they needed $700 million
to protect themselves from terrorism. I recognize the White House's
view that terrorism is the Department of Homeland Security's job, but
the provision of $65 million to the Nation's top 20 transit properties,
while welcome, is insufficient and must be addressed if we are truly to
call the reauthorization of TEA-21 ``SAFETEA.''
It is my hope that working with Chairman Shelby, Senators Sarbanes,
and Allard we will be able to craft a bipartisan bill that recognizes
that TEA-21 works as long as there are sufficient resources available
to meet the Nation's growing needs. However, the clock is running, and
I am concerned that the OMB's decision to severely limit needed
investments in our transit and highway systems as well as the
Administration's delay in getting its bill to the Congress makes the
job of enacting a reauthorization bill less, rather than more, likely.
Thank you, Mr. Chairman.
----------
PREPARED STATEMENT OF NORMAN Y. MINETA
Secretary, U.S. Department of Transportation
June 10, 2003
Chairman Shelby, Senator Sarbanes, and Members of the Committee,
thank you for the opportunity to appear before you today to discuss the
Administration's proposal to reauthorize our surface transportation
programs--the Safe, Accountable, Flexible, and Efficient Transportation
Equity Act of 2003, or ``SAFETEA.''
Nothing has as great an impact on our economic development, growth
patterns, and quality of life as transportation. This is equally true
at the national, State, and local levels. A safe and efficient
transportation system is critical to keeping people and goods moving
and cities and communities prosperous. Reauthorization will supply the
funds and the framework for investments needed to maintain and grow our
vital transportation infrastructure. In addition to improving the
quality of our lives and enhancing the productivity of our economy, our
proposed legislation seeks to place a central focus on transportation
safety.
Under SAFETEA, States would receive more resources to address their
own, unique transportation safety issues; would be strongly encouraged
to increase their overall safety belt usage rates; and would be
rewarded for performance with increased funds and greater flexibility
to spend those funds on either infrastructure safety or behavioral
safety programs. With the increased funding, States would be encouraged
and assisted in their efforts to formulate comprehensive safety plans.
Our Nation's transportation system obviously faces significant
challenges in other areas as well. Our proposal will create a safer,
simpler, and smarter Federal surface transportation program by
addressing transportation problems of national significance, while
giving State and local transportation decisionmakers more flexibility
to solve transportation problems in their communities.
SAFETEA calls for a record Federal investment in surface
transportation, spending over $201 billion on highway and safety
programs, and nearly $46 billion on public transportation programs,
from fiscal year 2004 through fiscal year 2009.
Building on the Legacies of ISTEA and TEA-21
Thanks in large part to the hard work of many of you and your
predecessors, SAFETEA builds on the tremendous successes of the prior
two surface transportation reauthorization acts. Both the Intermodal
Surface Transportation Efficiency Act of 1991 (ISTEA), with which I am
proud to have played a role, and the Transportation Equity Act of the
21st Century (TEA-21), provided an excellent framework to tackle the
surface transportation challenges that lie ahead.
ISTEA set forth a new vision for the implementation of the Nation's
surface transportation programs. Among other things, ISTEA gave State
and local officials unprecedented flexibility to advance their own goals
for transportation capital investment. Instead of directing outcomes from Washington, DC, the Department shifted more of its focus to giving State
and local partners the necessary tools to solve their unique problems while still pursuing important national goals. SAFETEA not only maintains this
fundamental ISTEA principle, but it also goes further by giving States
and localities even more discretion in key program areas.
TEA-21's financial reforms have proven equally significant. By
providing certainty, predictability, and of course, increased funding,
TEA-21 paved the way for State and local transportation officials to
undertake strategic transportation improvements on a record scale.
TEA-21 achieved this by reforming the treatment of the Highway
Trust Fund to ensure that, for the first time, spending from the
Highway Trust Fund for infrastructure improvements would be linked to
tax revenue. The financial mechanisms of TEA-21--firewalls, Revenue
Aligned Budget Authority (RABA), and minimum guarantees--provided
greater equity among States in Federal funding and record levels of
transportation investment. SAFETEA maintains the core TEA-21 financial
structure, while moderating the wide swings in program levels that
resulted from the RABA mechanism. In addition, we are proposing that
RABA apply to public transportation programs, as well as highway
programs.
Funding for Public Transportation Programs
SAFETEA is the largest proposed Federal commitment in the history
of public transportation, representing a 28 percent increase over the
funding levels of TEA-21. SAFETEA continues to fund transit programs
through both General Fund appropriations and funds available from the
Mass Transit Account of the Highway Trust Fund. Historically,
approximately 80 percent of the funding for transit programs has been
provided from the Mass Transit Account, with the remaining 20 percent
coming from the General Fund. Under current accounting practice, the
Federal Transit Administration's (FTA) split-funded accounts are drawn-
down (or outlayed immediately) and placed in the General Fund. This
results in the premature depletion of the Mass Transit Account, and
would bankrupt the account by 2007 if not corrected.
SAFETEA addresses this issue by funding as many programs as
possible from a single source, while maintaining the overall
approximate proportion (80/20 percent) of funding between the Mass
Transit Account and the General Fund. In particular, we propose to fund
formula programs and research activities entirely from the Mass Transit
Account; to fund the FTA Administrative account entirely from the
General Fund; and to split-fund only the New Starts Program. By
minimizing the number of split-funded accounts, we significantly reduce
the draw-down rate of the Mass Transit Account, thus avoiding the
depletion of that account.
In addition, funds from the Mass Transit Account would be
guaranteed by budgetary firewalls. Beginning in fiscal year 2006,
authorizations for public transportation funding from the Mass Transit
Account of the Highway Trust Fund will be adjusted (increased or
decreased) whenever the mass transit firewall amount is adjusted to
reflect actual receipts or more recent estimates of Mass Transit
Account revenue. That is to say, the budget authority will be aligned
with the revenue. The adjustment would be applied proportionately to
all Federal transit programs receiving funding from the Mass Transit
Account. Adjusting public transportation program funding levels each
year to reflect the latest information on receipts into the Mass
Transit Account is critical to ensuring that all of the dollars
actually collected will be spent on transit programs.
We are well aware that funding issues are and will continue to be a
matter of debate. As that debate progresses, it should not be permitted
to cloud a meaningful and necessary discussion of the many programmatic
reforms contained in SAFETEA, especially reforms of public
transportation programs.
Commonsense Transit Solutions
SAFETEA promotes commonsense transit solutions by reducing the
number of different program ``silos'' and formularizing all programs
except New Starts. This will give States and localities the flexibility
they need to fund local priorities. We want States to maximize mobility
and create a seamless community transportation network, not try to
match projects to specific pots of money.
Stable formula funds help agencies do more with limited resources
because they give financial markets the confidence to support transit
investments; give communities an incentive to commit long-term
resources; and give community developers the confidence that the
transit commitments necessary to support new development will be
honored.
In light of these important benefits, SAFETEA proposes a shift to
dependable formula and capital funding and a larger New Starts Program
by restructuring FTA programs into three major categories:
<bullet> Urbanized Area Public Transportation Formula Grants Program;
<bullet> Major Capital Investment Program;
<bullet> State Administered Formula Grant Programs, which include Other
than Urbanized (rural) Areas; Special Needs of Elderly Individuals
and Individuals with Disabilities; Job Access and Reverse Commute;
and the New Freedom Initiative.
Urbanized Area Public Transportation Formula Grants Program
Under SAFETEA, urbanized areas will have increased flexibility and
more predictable funding. By folding a portion of the former bus
discretionary program into the formula program, we propose to ensure
that every community can count on a share of these funds each year,
improving their ability to make longer-term investment plans and to
acquire financing for these plans, if necessary.
We also propose to move the Fixed Guideway Modernization Program
from the Capital Investment Grant Account to this formula program. In
doing so, we do not propose to change either the funding level for this
program or the formula used to distribute these funds. However, we will
accomplish the important goal of increasing local flexibility and
administrative ease in the use of these funds from year to year. As you
may be aware, some communities find that their need for Fixed Guideway
Modernization Funds can vary substantially from year to year, and the
priority they give to other investments also varies.
Communities should have the flexibility to merge Fixed Guideway
Modernization Funds with their regular urbanized area formula grant, so
that they can make more prudent, cost-effective investment decisions.
In one year, for example, they may choose to invest more in buses;
while the following year, they may require a larger expenditure on rail
modernization projects. We believe that local decisionmakers should
have the flexibility to make long-term investment plans that are not
driven by the old programmatic silos. Furthermore, by funding these
programs from the same account, a grantee would submit just a single
application for bus or rail ongoing capital needs and preventive
maintenance.
Major Capital Investment Program
Under SAFETEA, the Major Capital Investments Program would be
limited to the New Starts Program, but would expand that program to
provide capital assistance for new nonfixed guideway corridor systems
and extensions that meet the New Starts criteria, as well as new fixed
guideway systems and extensions. Under the 6-year SAFETEA
authorization, $9.5 billion would be made available for the New Starts
Program, an increase of 55 percent over the TEA-21 funding level of
$6.1 billion. This increase is necessary to ensure that there is
adequate funding to meet existing Full Funding Grant Agreements (FFGA)
and other meritorious projects in the pipeline. Approximately 20
percent of the funds for this program would be available from the Mass
Transit Account of the Highway Trust Fund with the remaining 80 percent
appropriated from the General Fund.
Projects seeking $25 million or less in New Starts funding would no
longer be exempt from the evaluation and rating process. Unfortunately,
experience has demonstrated that early project estimates can be
inaccurate. On numerous occasions, project sponsors who intend to seek
funds without participating in the project evaluation process suffer
serious set backs when they determine that they do, in fact, require
more than $25 million in funding from New Starts. Moreover, small
projects that proceed without adequate attention to ridership and
financial projections may find themselves in financial difficulty. In
addition, elimination of this exemption will deter project sponsors
from dividing corridor transportation systems into artificially small
segments in order to avoid the New Starts evaluation process. Under our
proposal, any project that seeks Federal New Starts funds will be
required to participate in the New Starts evaluation and rating
process.
At the same time, we recognize that the complexity of New Starts
projects can vary considerably. Therefore, we are proposing that
projects requesting less than $75 million be subject to a simplified
New Starts process. We would utilize the same evaluation criteria
established by Congress for projects seeking more than $75 million in
funding from New Starts, but reduce the number of New Starts hurdles
and simplify the evaluation process for these projects.
FTA has, for a number of years, encouraged project sponsors to
lower their Federal share requests in order to be competitive with
other projects in the New Starts pipeline. Over the last 10 years, the
overall New Starts share for projects with FFGAs has averaged
approximately 50 percent. SAFETEA would statutorily set the maximum
Section 5309 share for a New Starts project at 50 percent. However, 30
percent of the project cost could be from other Federal funds that are
eligible to be expended for transportation. This requirement would
encourage New Starts sponsors to develop projects with the highest
feasible local share and allow us to fund a greater number of
meritorious projects in the future. In addition, it gives communities
an even greater stake in ensuring that the return on investment in
these projects is as high as possible.
Finally, the Administration has proposed to expand New Starts
eligibility to permit the funding of cost-effective, nonfixed guideway
corridor transit systems. FTA has always funded meritorious public
transit projects, but the current statute restricts New Starts funds to
projects that utilize a fixed guideway. Fixed guideway projects are
critical to public transportation, and they will continue to be
eligible for funding, but worthy projects that propose lower-cost
nonfixed guideway solutions also deserve consideration. With today's
technology--particularly bus rapid transit--a fixed guideway is often
not the most cost-effective method of providing new or expanded
corridor systems. The current rules encourage communities to choose a
more expensive fixed guideway system in order to qualify for a New
Starts grant.
Moreover, some small and medium-sized communities that would
benefit enormously from the creation of some new transit options simply
cannot generate enough riders or travel-time savings to justify a more
expensive fixed guideway system. We will work closely with Congress and
with all of our stakeholders to ensure that, as we make room for these
cost-effective, nonfixed guideway transit solutions, we do not
compromise the intent of the New Starts Program.
State-Administered Formula Grant Programs
SAFETEA also seeks to promote common sense transit solutions by
giving States and communities the opportunity to determine how they can
best serve populations that rely heavily on public transportation,
including many rural residents, older adults, persons with
disabilities, and low-income riders.
Currently, an estimated 40 percent of rural counties have no public
transportation, and in many other rural areas, only limited service can
be provided. Yet, rural residents rely heavily on public transit when
it is available. Therefore, like the urbanized area program, we are
proposing to allocate the nonurbanized area share of the bus program by
formula instead of unpredictable discretionary grants. We believe the
increased stability and predictability of funding that this change
produces will make it easier for States to plan for public
transportation investments and to leverage Federal dollars. Almost $2.3
billion will be provided over the life of SAFETEA for the nonurbanized
formula program, an 87 percent increase over the TEA-21 level.
The absence of predictable funding has frustrated many States that
want to leverage other transportation resources provided at the State
level through such health and human service programs as Medicaid. In
one northeastern State, for example, the State Department of
Transportation knew it had a solution to helping thousands of welfare
recipients who could work, but were not able to get to work. The State
could make its program funds go twice as far if they could get a Job
Access grant from FTA, matching it with State Temporary Assistance to
Needy Family (TANF) funds for transportation services. But there was no
assurance that the Job Access funds were really coming. In fiscal year
2002, Job Access and Reverse Commute (JARC) projects were earmarked in
law, and this particular State project was not among them. As a result,
the State Department of Human Services obligated its funds to other
services.
To address these problems, SAFETEA proposes to allocate by formula
to States all of the funds for transit programs that should be closely
coordinated with human service programs in a State. We believe that, if
States and communities are to effectively meet public transportation
needs, we must provide dependable resources and eliminate the barriers
to effective coordination. Our proposal will continue the Elderly and
Persons with Disabilities Program that is currently administered as a
formula program to States, and it will create a similar formula
allocation of funding for the President's New Freedom Initiative.
The New Freedom Initiative will provide new transportation services
for persons with disabilities that go beyond the requirements of the
Americans with Disabilities Act. In addition, SAFETEA will make the
JARC program a State-level formula program. Currently, JARC is
administered as a national competitive discretionary grant program,
and, typically, many projects are designated in appropriations
conference committee reports. The JARC program has proven its
effectiveness; it should be made more widely available and provided
through a stable, predictable funding mechanism.
Even with predictable funding for these important services, we know
that finding solutions that work is not always easy. To help ensure
that communities can make informed decisions about priorities and
needs, we are also increasing the funds available for planning,
administration, and technical assistance. We want the coordinated
health, human service, and transportation planning that have been so
successful in the Job Access program to become a common practice in
every community. As a result, we are asking communities to establish
community-wide funding priorities and a coordinated plan for services
to the elderly, persons with disabilities, and low-income populations.
These plans will give each community more control over its transit
planning and make it easier to avoid the creation of costly, duplicate
transportation systems. And, as long as the funds are used to serve the
intended populations, we intend to ensure that the flexibility to
leverage the funding for all of these programs exists.
We look forward to more success stories like that of the Virginia's
Northern Shenandoah Valley Public Mobility Project, which formed a
coalition of 15 human service and nonprofit organizations to coordinate
transportation services for their clients. These clients include
individuals with mental or physical disabilities, elderly individuals,
and individuals participating in back-to-work programs. Through a
coordinated transportation service delivery plan, the number of monthly
trips increased by 58 percent, and the costs dropped by almost 18
percent per trip. The bottom line is that we want to let communities
implement common sense solutions that will promote independence and
economic opportunity--solutions that will save money, and result in
more and better service to more riders.
Performance Incentives
Consistent with the President's call for customer-focused, outcome-
oriented Government, SAFETEA includes a new ridership-based performance
incentive program to encourage A+ performance in transit. The program
will be relatively small for the first year--$35 million in urbanized
areas and approximately $3 million in rural areas. Over the course of
SAFETEA, however, the program will provide nearly $1.3 billion in
incentive awards to top performing transit systems.
The many benefits of public transportation cannot be measured in
terms of miles of track, number of buses, or the capacity of rail cars.
If the buses and trolleys and rail cars are empty, we will not have
achieved increased mobility, reduced air pollution, or improved our
economy. The benefits of transit depend on riders. Participation in
this program would be voluntary.
Providers that receive urbanized area or rural formula funds and
prove their success by increasing ridership will be eligible for
incentive grants. This program will encourage States and urban areas to
institute the data collection necessary to measure performance, but
more importantly, focus their attention on the issues that matter most
to riders and potential riders.
To ensure that services are not shifted away from transit-dependent
populations that are somewhat more costly to serve, urbanized areas
that experience a significant decline in public transportation
patronage by individuals with disabilities, the elderly, or low-income
persons would not be eligible for a performance incentive award.
The Department recognizes that rural transit operators have not
been required to report on overall ridership, and urban transit systems
are not required to report ridership by population group. During the
first three fiscal years of this initiative, a portion of the funds
would be available to assist States and urban areas to institute the
data collection necessary to measure performance, so that they can
participate in the incentive award program.
Simplified Program Requirements
SAFETEA includes a number of important changes to ease the
regulatory burden on all transit grantees, but especially on small,
rural, and nonprofit grantees whose administrative capacity can be
strained by burdensome rules and program requirements. Among the
specific requirements affected are Buy America, labor certifications,
and drug and alcohol testing. SAFETEA in no way undermines the intent
of the current regulations, but rather is intended to ease the burden
of compliance, particularly for small grantees.
Buy America
We propose to ease the paperwork and regulatory burden on all
grantees by excluding all manufactured products except rolling stock
(buses and railcars) from the Buy America requirements. This change
comports with the current Buy America rules under the Federal aid
highway program. SAFETEA will further help smaller grantees by
eliminating the requirement for pre-award and post-delivery audits of
Buy America compliance for private nonprofit operators and grantees
serving urbanized areas of less than one million people. These grantees
will still be required purchase rolling stock under Buy America rules.
Labor Certifications for Rural Operators and Non-Profit Operators
We propose to enact into law the Department of Labor's (DOL)
current practice of using a Special Warranty to ensure fair and
equitable arrangements protecting the interests of employees of rural
operators. Further, in order to provide consistent requirements for
nonprofits regardless of which source of program funds they receive,
SAFETEA proposes to extend the Special Warranty provision to recipients
of Job Access, Elderly and Disabled, and New Freedom Initiative funds.
The proposal also includes, however, a provision to give the Secretary
of Transportation the authority to, on a case-by-case basis, waive the
requirement for a Special Warranty for a private nonprofit operator.
Drug and Alcohol Testing Program
SAFETEA would give the Secretary of Transportation the authority to
exempt from FTA testing requirements those public transportation
providers that are adequately covered under other Federal or
Departmental testing statutes or regulations, such as the U.S. Coast
Guard's testing requirements applicable to ferryboat employees.
Fewer Grant Applications
By combining programs under accounts that reflect the type of grant
recipient, we have also paved the way for the submission of a single
grant application for
several grants. Urbanized areas will be required, for example, to
submit only one application to receive both their regular formula and
Fixed Guideway Modernization Formula Funds. For both urban and rural
areas, the formularization of the bus program will eliminate the need
to make separate grant applications for those funds. In addition, Job
Access funding requests will be submitted through a single, simplified
State application. These reductions in ``electronic paperwork'' will
ease administrative workloads throughout the system.
Other Important Initiatives
The Transportation Planning Process
Good transportation planning is essential to understanding the
mobility problems communities face, identifying appropriate solutions,
and making decisions on the investment of these funds. The resulting
decisions contribute directly to the efficiency of our national
transportation system, the accessibility of our people to jobs and
other activities, the health of our economy, and the quality of our
environment.
Over the 6-year authorization of SAFETEA, funds available for State
and metropolitan planning ($822 million) will more than double the
amount provided under TEA-21 ($365 million). With 76 new urbanized
areas designated as a result of the 2000 Census, additional funding
will be needed to help support at least 40 new Metropolitan Planning
Organizations (MPOs), as well as a number of existing MPOs whose
geographic scope was significantly expanded. MPOs are responsible for
preparing long-range and short-range plans for transportation
improvements in their metropolitan area.
This work involves ongoing public involvement, analysis of travel
trends and forecasts, the assessment of community and environmental
impacts, and financial planning to ensure that programs are financially
feasible. In metropolitan areas, only projects that are formally
adopted by the MPO are eligible for funding under FTA and FHWA
programs.
SAFETEA proposes to combine the long-range metropolitan plan and
the shorter-term Transportation Improvement Program into a single plan.
Other changes will improve the linkage between the transportation
planning and project development processes, which will ultimately
enhance transit project delivery.
In addition, we are proposing to create a new Planning Capacity
Building Program, jointly funded by FTA and FHWA, to improve State and
local planning methods and technical capacity. Over the last several
years, there have been new and increased demands placed on the planning
process--more emphasis on freight
planning, land use linkages, security, safety, performance-based
planning, and operations planning. We want to help all communities take
advantage of these important advances by highlighting best practices,
sponsoring peer-to-peer exchanges, providing training, conducting
special workshops, and other activities.
Federal Lands Transportation
On May 30, 2001, President Bush announced the National Parks Legacy
Project, a series of proposals to enhance the protection of America's
national parks and increase the enjoyment of those visiting the parks.
Each year, there are over 900 million visits to National parks,
forests, and wildlife refuges.
In support of the President's National Parks Legacy Project, a new
Federal Lands Transit Program would also be established. This new
transit program will provide $150 million in funding over the life of
SAFETEA. The proposal would authorize the Secretary of Transportation,
in consultation with the Secretary of the Interior, to make grants,
contracts or other agreements to carry out qualified planning or
capital projects in, or in the vicinity of, a federally owned or
managed park, refuge, or recreational area that is open to the general
public.
Project Delivery
The President and I believe that we can and must protect our
environment while improving the efficiency of transportation project
delivery, consistent with the President's Executive Order on
Environmental Stewardship and Transportation Infrastructure Project
Reviews. We know that it takes too long to move a transportation
project from concept to completion, and the Administration is committed
to streamlining this process. Projects that were cutting edge while in
the concept stage too often end up turning into ``catch-up'' projects
after years of delay.
The Department has made great progress in addressing those delays
related to environmental review, including better coordination during
the environmental review process, and other improvements that have
resulted from implementing the President's Executive Order on
Environmental Stewardship that was issued last fall. However, certain
legislative changes are necessary.
In the environmental review area, SAFETEA provides a menu of
solutions, all of which should help reduce the time it takes for a
sponsor to deliver a transportation project. These include: Delegating
categorical exclusions to States; clarifying the role of States or
project sponsors in expedited review procedures, particularly regarding
the establishment of time periods for environmental reviews; limiting
the filing of court appeals to no more than 6 months following a
Federal decision; and reforming Section 4(f) of the Department of
Transportation Act to include consistent and appropriate criteria.
Technology
While virtually every other industry in the world has gone through
a technological revolution, transportation still lags behind in the
area of technology deployment. SAFETEA continues to foster the
research, development, and implementation of Intelligent Transportation
Systems (ITS) technologies but places a much greater emphasis on using
these technologies to improve the performance and operation of
transportation systems in a way that directly benefits transportation
customers. SAFETEA mainstreams the ITS deployment program and offers
performance incentives to States and localities that successfully
implement technology to improve the overall management of their
transportation systems, including their public transportation systems.
Intermodal Facilities
Despite their critical role in the surface transportation system,
intercity buses have been largely a ``forgotten mode.'' SAFETEA
addresses this anomaly by establishing requirements to improve
intercity bus access to significant intermodal facilities. Our proposal
also authorizes a $425 million grant program to fund capital
improvements related to such access.
Fuel Tax Evasion
Evasion of Federal fuel taxes is a serious and growing problem that
requires an equally serious Federal response. This has been, I know, a
major concern of Congress. SAFETEA reduces legal loopholes and
dedicates more resources to a collaborative Government-wide enforcement
effort. If we are successful in curbing fuel tax evasion, it has the
potential to increase resources for investment in the entire
transportation system.
Conclusion
Mr. Chairman, this legislative proposal builds upon the principles,
values, and achievements of ISTEA and TEA-21, yet recognizes that there
are new challenges to address. We urge Congress to reauthorize the
surface transportation programs before they expire on September 30,
2003. Any delay would cause uncertainty and likely reduce
infrastructure investment at the State and local levels at a time when
such investment is particularly critical.
With stable formula funding, streamlined programs, performance
incentives, and simplified administrative requirements, our communities
will be in a better position to leverage the Federal investment in
public transportation and provide Americans with common sense solutions
to meet their transportation needs.
Thank you, Mr. Chairman, for giving me the opportunity to testify,
and I look forward to working with Congress to pass this legislation. I
would be happy to answer any questions you or other Members of the
Committee may have.
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PREPARED STATEMENT OF WILLIAM MILLAR
President, American Public Transportation Association
June 10, 2003
APTA is a nonprofit international association of over 1,500 public
and private member organizations including transit systems and commuter
rail operators; planning, design, construction, and finance firms;
product and service providers; academic institutions; transit
associations and State departments of transportation. APTA members
serve the public interest by providing safe, efficient and economical
transit services and products. Over ninety percent of persons using
public transportation in the United States and Canada are served by
APTA members.
Introduction
The American Public Transportation Association (APTA) appreciates
the opportunity to testify on issues related to the reauthorization of
the transit title of the Transportation Equity Act of the 21st Century
(TEA-21), and specifically on the Administration's reauthorization
proposal, called the Safe, Accountable, Flexible, and Efficient
Transportation Equity Act (SAFETEA).
APTA's 1,500 public and private member organizations serve the
public by providing safe, efficient, and economical public
transportation service, and by working to ensure that those services
and products support national energy, environmental, community, and
economic goals. APTA member organizations include transit systems and
commuter railroads; design, construction, and finance firms; product
and service providers; academic institutions; and State associations
and departments of transportation. More than 90 percent of the people
who use public transportation in the United States and Canada are
served by APTA member systems.
Mr. Chairman and Members of the Committee, we want to thank you for
the critical role you played in crafting TEA-21. TEA-21 has been an
enormous success for the Nation and transit riders in communities of
all sizes. Since its enactment, transit ridership has grown by more
than 21 percent, the FTA has entered into 18 Full Funding Grant
Agreements for rail projects, and millions of the Nation's citizens
were given the option to use public transportation.
APTA'S Reauthorization Proposal
APTA worked with its membership over the past several years to
develop the transit industry's recommendations for reauthorization of
the Federal transit program. To guarantee maximum participation of
APTA's diverse membership, APTA developed a reauthorization task force
which met more than 20 times in some 14 cities throughout the Nation,
many in conjunction with major association meetings.
As a result of that process, APTA developed a proposal that
reflects an industry consensus and builds on the extraordinary success
of TEA-21. APTA's proposal retains most of the current program
structure. It calls for a reauthorization of TEA-21 that is
evolutionary, rather than revolutionary. It is based on the idea that a
good national transportation system serves as the foundation for a
strong and growing economy and that balanced investment in all modes
should be encouraged under the Federal program that supports our
surface transportation infrastructure.
APTA's proposal is based on identified capital needs. The AASHTO
Bottom Line report and a Cambridge Systematics, Inc. study both
conclude that to maintain and improve public transportation some $43
billion annually would be required from all sources. APTA proposes to
grow the Federal transit program from $7.2 billion in fiscal year 2003
to $14.3 billion in fiscal year 2009. We call for the continuation of
funding guarantees for both the trust fund and General Fund components
of the transit program that are critical to long-term capital planning
conducted by transit operators. And we make a number of proposals to
improve program delivery.
Mr. Chairman, our proposal would make no change to the structure of
the Federal transit program below the current $7.2 billion funding
level. Programmatic changes are made only with funding increases. Over
the course of the proposal, some 55 percent of increases would go right
back into the existing program. Our proposal calls for extra growth for
some programs, particularly for rural and smaller urban areas. It also
establishes a rule that would ensure that transit formula funding never
falls below $1.15 for every $1 in funding for the major capital
investment programs.
Finally, APTA has made recommendations on ways to fund its
proposal. It calls for maintaining the longstanding principle under
which 80 percent of the transit program is funded from the Mass Transit
Account (MTA) and 20 percent of the program is funded with General
Funds. We also support a range of ways to increase
program revenue, including indexing current motor fuel user fees for
inflation--to restore the purchasing power of the user fee; scoring
outlays from the Mass Transit Account in same ways as Highway Account
outlays are scored; and restoring the payment of interest on trust fund
balances.
APTA strongly opposes any reduction in current motor fuels user fee
support for transit and recommends an 80/20 split between highways and
transit for any increase in the existing motor fuels user fee. We are
pleased that our transportation colleagues at AASHTO and ARTBA have
also expressed their support maintaining this current structure. We
particularly want to thank the leadership of this Committee for its
strong, bipartisan support on this issue. We agree with the Committee
that these dedicated revenues are essential to the long-term viability
of the transit program and we do not want to lose a funding source that
has worked so well for more than 20 years.
Mr. Chairman, in this time of slow growth, it is important to note
what increased investment in surface transportation infrastructure
means for jobs and the economy. Each $1 billion in Federal
transportation investment creates 47,500 jobs. In terms of economic
impact, we were pleased to sponsor, along with the Transportation
Construction Coalition, a study of a proposal to provide significant
increases in highway and transit funding over the next 6 years. That
study, by Global Insight, Inc.,* clearly demonstrates that increased
investment in transit and highways has a significant impact on GDP and
is critical to improving business productivity and strengthening the
American economy.
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* Held in Committee files.
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Administration Proposal
Overall Funding Levels
On May 14, the Administration submitted to Congress its proposal
for TEA-21 authorization, called SAFETEA. APTA commends the overall
proposal for its goals of reducing fatalities by improving highway
safety, and striving for efficiency. But we are disappointed about
several aspects of the proposal.
SAFETEA authorizes funding for the 6-year life of the bill at $247
billion, with $45.7 billion authorized for transit, of which only $37.6
billion would be guaranteed. In our view, the proposal fails to
adequately address either transit or highway needs that have been
identified by the U.S. Department of Transportation and independent
analyses. As noted earlier, The American Association of State Highway
and Transportation Officials and Cambridge Systematics, Inc., both
estimated that transit capital needs to maintain and improve public
transportation are more than $43 billion annually. This Committee's
investigations have confirmed that needs exceed current resources and
continue to grow.
Under TEA-21, Congress generally funded only the guaranteed portion
of the transit program, and this is likely to be the case during the
next authorization as well. This is where the Administration proposal
is very disappointing: Under it, guaranteed funding for the transit
program is limited to resources from the Mass Transit Account and would
rise from $5.9 billion in fiscal year 2004 to only $6.6 billion in
fiscal year 2009--a significant reduction from the guaranteed level of
funding under TEA-21. TEA-21 provided guaranteed funding of $36
billion; the Administration's proposal would provide $37.6 billion.
After inflation, this represents a real reduction. In the face of large
and growing transit needs, and with the significant ridership growth
brought about by TEA-21, clearly greater investment in public
transportation is necessary, not less. And just as clearly, the
guarantee must include the General Fund portion of the program, as it
does under TEA-21. This concept was established by this Committee, and
it has been an essential element of TEA-21's success.
Program Changes
At the outset, Mr. Chairman, we do want to note there are a number
of provisions in SAFETEA that would streamline Federal transit program
delivery and eliminate red tape. We appreciate those proposals to make
the program work more effectively, and will work with the Committee
staff on them. We appreciate the proposal to coordinate drug and
alcohol testing that would eliminate duplicative testing and
unnecessary costs associated with redundant testing. We agree with the
Administration effort on small starts. We also want to thank, in
particular, Department of Transportation Secretary Mineta and FTA
Administrator Dorn for their efforts in recent years to improve the
delivery of program resources and eliminate regulatory red tape.
At the same time, however, the Administration proposal calls for
major changes in the Federal transit program structure and the creation
of a number of new programs without any commensurate growth in new
funding. Mr. Chairman, one of our key themes is not only that TEA-21
works, but also that it works extremely well. Transit ridership is up
in large cities and small, and States and localities rely on the
predictability of funding under the existing TEA-21 structure. That
balanced structure has been in place for more than 20 years, and it has
served the transit industry well. In short, we believe it is better to
build on the success of the existing program and the results that that
program has produced.
The Administration proposal would significantly restructure the
Federal transit program. It would eliminate the bus and bus facilities
capital discretionary program and use funds that now go to that program
for other programs. APTA supports retention of this important capital
program. Transit agencies have periodic bus replacement and facility
needs that cannot be met from the formula program. The role of the
discretionary bus program is to address those needs. Our proposal calls
for substantial growth in the bus and bus facility program to address
growing needs.
The Administration proposal also would reduce the Federal match
under the New Starts Program; permit the use of New Starts funds for
new purposes; distribute Fixed Guideway Modernization Funds with urban
formula funds; and expand the eligible use of Fixed Guideway
Modernization Funds. APTA questions the need for all four proposed
changes.
APTA strongly opposes any effort to reduce the Federal match on New
Start funds. TEA-21 and ISTEA, both emphasized a planning process
designed to encourage transportation decisions based on project merit
and local needs. Both ISTEA and TEA-21 leveled the playing field for
transit and highway investment in so far as the matching ratio is
concerned. Reducing the Federal share on New Starts projects to a
maximum of 50 percent, while keeping most other surface transportation
Federal matches at 80 percent, will simply bias the local
decisionmaking process. Transportation planners at the State and local
level, with excess demand for both transit and highway projects and
dwindling State and local resources, will be far, far more likely to
choose projects with the higher Federal match. APTA believes that it
makes more sense to address excess demand with increased funding for
New Start projects than it does to reduce the Federal match.
The Administration proposal also would permit the use of New Starts
funds for ``nonfixed guideway improvements to encourage, among other
things, consideration of bus rapid transit options.'' APTA believes
that Bus Rapid Transit (BRT) projects can be an effective option for
communities considering fixed guideway systems. BRT systems already are
eligible for New Start funding, if they have ``exclusive rights of way
or other fixed guideway design,'' and APTA supports continuation of
that BRT eligibility under the New Starts Program. APTA and the
Administration have both proposed increases in the ``small starts''
threshhold--the funding level under which less expensive fixed guideway
projects qualify for a simplified rating process. We believe that this
would encourage BRT projects, where Federal funding often stays under
$75 million to $100 million. We also believe that less expensive
nonfixed guideway bus systems can be funded in good measure under the
existing bus discretionary program.
APTA questions the Administration proposals to distribute Fixed
Guideway Modernization Funds under the urban formula program and to
permit the use of Fixed Guideway Modernization Funds for nonfixed
guideway modernization purposes. The Fixed Guideway Modernization
Program was originally designed to ensure the proper modernization of
the Nation's older rail transit systems, and it helps ensure that as
Federal New Start investment projects age they can be modernized. Rail
systems in large metropolitan areas carry millions of passengers each
year and their ridership has grown substantially in recent years. Many
of these systems are approaching capacity constraints. These funds also
help systems address this growth in ridership and ensure that
passengers can use these systems safely and efficiently. The
Administration proposal would allow these funds to go to an urbanized
area and be used for any transit purposes, not just modernization. We
are concerned that diverting these funds from fixed guideway
modernization, where needs far exceed available resources, would only
exacerbate unmet modernization needs and potentially result in the
deterioration of some of the Nation's most valuable capital assets.
Again, the fixed guideway modernization program has been a critical
component of the Federal transit program structure since 1982, and is a
great success.
APTA agrees with the Administration that rural formula funding
should be increased. APTA's proposal recommends a 110 percent increase
in rural formula funding by 2009. Under APTA's proposal the rural
formula program would grow to over $504 million by 2009. Under the
Administration proposal, rural formula funding would be $102 million
less than under APTA's proposal. While we fully support increased
funding for rural public transportation, we believe that the
Administration proposal to increase the program by $229 million in
fiscal year 2004--at the same time that the total transit authorization
is frozen and guaranteed funding is cut by more than $1.2 billion--is
inappropriate.
The Administration bill would distribute Job Access and Reverse
Commute (JARC) grants under a formula to the States. APTA believes that
the JARC program has been successful at helping get workers to jobs and
training, but with the extremely minimal growth envisioned under the
Administration proposal, we are concerned that formulizing the JARC
program would only mean that too little funding would be spread to
thinly to provide effective new programs at the local level.
New Programs
APTA commends the Administration for attempting to better address
the transportation needs of people with disabilities, for improved
intercity bus facilities, and public transportation in and around
national parks. In particular, not only have we expressed support for
transit in parks and the New Freedoms Initiative in the past, but we
have also indicated that such programs should not be funded at the
expense of existing transit programs or needs.
While APTA recognizes the need to address unmet transit needs, we
also believe that current funding levels do not address needs under
existing programs, and that new programs should be funded with
increased funding and not by reducing funding for current programs.
With that principle in mind, we question the Administration's proposal
to create both the New Freedoms Initiative and the Intermodal Passenger
Facilities programs. Both programs address important issues, but
arguably at the expense of current transit needs.
The Administration proposes to fund the New Freedoms Initiative at
$145 million in fiscal year 2004, increasing to $162 million in fiscal
year 2009. The program is intended to provide grants for ``new
transportation services and transportation alternatives beyond those
required by the Americans with Disabilities Act.'' Certainly, this is a
worthy use of Federal funds, but transit agencies are struggling now to
keep up with ADA required services and need additional funding to meet
the requirements of ADA.
Similarly, while APTA appreciates the effort to fund intermodal
facilities that are related to intercity bus service, this program is
unlikely to provide substantial benefits to users of intracity or local
public transportation bus service. The fact that it would take $75
million each year from a transit program that does not grow in fiscal
year 2004 and grows very little in subsequent years, means that it
would be funded largely at the expense of already existing public
transportation capital needs.
The Administration proposes to create a new ``incentive tier''
within both the urban and rural formula programs. In both cases, this
would be a takedown from formula funding, which would be distributed to
transit systems based on ridership growth. The takedown would be small
in the early years and used mainly for data collection. Funding for
both would, however, grow to almost $420 million by 2009 and grants are
intended to provide incentives for increased ridership. APTA member
transit systems are always striving to increase ridership and improve
efficiency. This proposal is a ``rob Peter to pay Paul'' situation
under a proposal that provides little growth and a cut in guaranteed
funding.
APTA is not convinced that the incentive tier would actually
promote increased ridership, and feels that it could hurt transit
operators who have already achieved or are approaching capacity
limitations. We note also that Congress has already addressed this
issue: Current law contains incentive tiers under both the bus and
fixed guideway factors of the existing formula program, and that those
funds are awarded to systems which have high rates of ridership
relative to operating costs. And we note further that APTA's proposal
calls for a ``high intensity small urbanized area formula program''
that would provide formula bonuses to transit systems in small urban
areas that provide above average levels of service.
Increased Demand
Growing demand nationwide for transit services shows the
effectiveness of increased Federal investment under TEA-21 and the need
to continue that trend. In a recent 5-year period, transit ridership
grew 22 percent, greater than the growth rate of highways and domestic
air travel during the same time frame.
Support for increased transit service remains high. A February 2003
Wirthlin Worldwide Public Opinion Poll showed 81 percent of Americans
support the use of public funds for the expansion and improvement of
public transportation; 56 percent say the need to reduce traffic
congestion has become more important over the last 5 years. The poll
also stated 57 percent agree their community needs more public
transportation options, including 64 percent of urban residents, 59
percent of suburban residents, 51 percent of rural residents, and 55
percent of small-town residents. Some 64 percent of respondents said
they would be more likely to support a Congressional candidate who
supports improving public transportation options.
This poll demonstrates that support for public transportation has
increased dramatically not only in our biggest cities, but also, in
smaller, urban communities and rural areas as well, where 40 percent of
America's rural residents have no access to public transportation, and
another 28 percent have substandard access. It is estimated that rural
America has 30 million nondrivers, including senior citizens, the
disabled and low-income families who need transportation options.
According to a survey of APTA members, bus trips in areas with
populations less than 100,000 increased from 323 million to 426 million
in a recent 5-year span.
Conclusion
Mr. Chairman and Members of the Committee, we thank you for your
effort to address public transportation needs in the next authorization
bill and for your leadership in developing the existing law. TEA-21 was
an enormous success for public transportation. Increased investment in
our public transportation infrastructure can improve service for
millions of citizens who use transit, make the existing highway system
in metropolitan areas work more efficiently and reduce the need to
build costly new highways in those same areas. It can reduce congestion
and pollution in and around our cities, get rural residents where they
need to go, and provide a lifeline to medical services and jobs for
Americans who do not have access to private automobiles.
Public transportation is an important component of the Nation's
transportation system and we need to invest in that entire system if we
are to keep pace with the growing demand for transit service and
preservation of the existing Federal investment in the transit
infrastructure. Mr. Chairman, we look forward to your leadership and to
working with you and the other Members of the Committee as it crafts
and advances legislation to reauthorize the Federal transit program. We
would be pleased to answer questions you may have on APTA's proposal or
our testimony.
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PREPARED STATEMENT OF JEFF MORALES
Director, California Department of Transportation
on behalf of The American Association of
State Highway and Transportation Officials
June 10, 2003
Mr. Chairman and Members of the Committee, my name is Jeff Morales,
and I am the Director of the California Department of Transportation. I
am here today to testify on behalf of the American Association of State
Highway and Transportation Officials (AASHTO) in my role as Chairman of
the AASHTO Standing Committee on Public Transportation. We thank you
for your leadership in holding this hearing to address key transit
issues to be considered in the reauthorization of the Transportation
Equity Act for the 21st Century (TEA-21).
Let me begin my remarks by saying that there are a number of key
transit provisions in the TEA-21 legislation that should be continued
in the reauthorization legislation. With regard to transit issues,
while we believe that while some of the TEA-21 provisions may need some
fine tuning, and annual funding levels need to be
significantly increased, for the most part, the transit program
provisions of
TEA-21 should be continued. We have divided our testimony into three
major areas,
including:
<bullet> AASHTO's reaction to the Administration's reauthorization
proposal titled, The Safe, Accountable, Flexible, and Efficient
Transportation Equity Act of 2003 (SAFETEA);
<bullet> AASHTO recommendations for rural transit in the TEA-21
reauthorization legislation; and
<bullet> Transit bonding proposal.
AASHTO's Reaction to the Administration's SAFETEA Proposal
Major Investments and Program Financing--AASHTO members are
disappointed that the Administration's proposed funding levels for
highways and transit fall substantially short of the documented need
for investment in highways and transit. The Administration proposes
$201 billion for highways and $46 billion for transit, in spite of the
significant highway and transit needs identified by the U.S. Department
of Transportation in its report titled Status of the Nation's Highways,
Bridges, and Transit: 2002 Conditions and Performance Report. Under
SAFETEA, transit funding growth would be limited over the
reauthorization period, starting at $7.2 billion in fiscal year 2004
and rising to only $8.1 billion in fiscal year 2009. In fact, the level
in constant dollars would be $1.1 billion below the transit funding
level for fiscal year 2003.
AASHTO's reauthorization policies call for a total program level of
$300 billion over 6 years, including $245 billion for highways and $55
billion for transit. Under the AASHTO proposal, the transit program
would be funded at $7.5 billion in fiscal year 2004, increasing to a
minimum level of $11 billion in fiscal year 2009. Further, AASHTO
supports the higher APTA-proposed funding level that would rise to $14
billion in fiscal year 2009, provided that such an increase would not
come from sources upon which highways depend.
In addition, AASHTO is very concerned that the SAFETEA proposal,
while ``guaranteeing'' funds from the Mass Transit Account of the
Highway Trust Fund, contains no similar guarantee for the General Fund
component of transit funding. One of the key provisions of the TEA-21
legislation is the guarantee that it provides for both Highway Trust
Fund and General Fund monies. The framers of the TEA-21 legislation
recognized that the States and transit agencies need a stable and
predictable source of transit funds in order to plan, program, and
construct major transit projects. AASHTO believes that it is critical
that both Highway Trust Fund and General Funds for transit are
guaranteed in the TEA-21 reauthorization legislation.
AASHTO is further concerned that the SAFETEA proposal calls for a
reduction of the Federal funding share for New Starts projects from 80
percent to 50 percent. AASHTO believes that in order for State and
local officials to make balanced decisions between highway and transit
projects, the Federal share of 80 percent should be retained for both
highway and transit projects. Otherwise, the decisionmaking process can
become skewed toward projects with a higher Federal match rate,
particularly when State and local governments are experiencing tight
budgets.
The SAFETEA proposal would shift the FTA program funding structure
so that the New Starts Program would receive approximately 80 percent
of its funding through the General Fund while other major FTA programs
would be funded through the Mass Transit Account of the Highway Trust
Fund. This approach is being taken in order to deal with the issue of
the solvency of the Mass Transit Account of the Highway Trust Fund.
Since SAFETEA does not propose a guarantee for General Funds, a major
component of the FTA program, New Starts, would be vulnerable to
significant funding reductions during the annual appropriations
process. The New Starts Program is a key part of the FTA program, and
needs to be funded in a way that State and local governments are
assured of a stable and reliable source of Federal funding as they
embark upon these more expensive projects. As part of this proposal,
bus discretionary funding would be eliminated and the Rail
Modernization program would be shifted to the formula program.
AASHTO agrees that solvency of the Mass Transit Account can be
addressed without such major changes to the FTA programs. AASHTO staff
is available to work with your staff to offer recommendations in this
area.
Program and Requirements Streamlining
Existing transit legislation provides that an independent pre-award
review and a post-delivery review must be conducted when an FTA grantee
purchases transit rolling stock. This has been a costly and burdensome
requirement for many smaller transit systems. AASHTO supports the
provision in SAFETEA that eliminates the requirements for private
nonprofit organizations and grantees serving areas fewer than one
million people to have to certify on Buy America requirements. All
manufacturers and suppliers would continue to have to certify
compliance with Buy America during the bidding process, and they would
remain bound by their original certification.
Planning--AASHTO supports the SAFETEA proposal that would give
standing in NEPA to studies developed as part of the planning process.
The results of studies developed as part of the planning process that
may have standing in the NEPA process include purpose and need; the
alternatives selected for evaluation in an environmental assessment or
impact statement; and an assessment of environmental impacts related to
development growth, including direct and cumulative effects, that is
consistent with local land use, growth management, or development
plans.
This provision is designed to expedite the planning and development
of transportation improvements presuming that studies developed as part
of the planning process establish the basis for an environmental
assessment or impact statement. AASHTO has been working with U.S. DOT
and Congressional Committees for the past several years to get a number
of improvements to the project development process and to reduce the
time needed to deliver a project.
Innovative Finance--In the area of innovative finance, the
Administration's bill would continue the Transportation Infrastructure
Finance and Innovation Act (TIFIA) program. Under this proposal, the
threshold for requesting credit support is reduced from $100 million to
$50 million. AASHTO recommends that this threshold be reduced to $25
million. However, we believe that the Administration is taking an
important step in the right direction.
SAFETEA would continue the State Infrastructure Bank (SIB) pilot
program, although it would be restricted to five States. Currently six
States are participating in a pilot, and officials indicate that those
States would have to again compete for participation with other States
who may now be interested. AASHTO has recommended that the SIB program
be expanded to all 50 States.
AASHTO Rural Transit Proposals for TEA-21 Reauthorization
Every State has some level of public transportation service to its
rural areas. Approximately 1,260 organizations provide public
transportation in rural areas, and 3,660 organizations provide public
transportation services to the elderly and people with disabilities.
Approximately 55 percent of the existing bus and van fleet serving
rural America has already exceeded the Federally rated service life.
Within the next reauthorizaiton period, almost all of the Nation's
rural transit vehicles will need to be replaced. About 9,200 vehicles
per year will need replacement on an ongoing basis.
AASHTO, in its ``Bottom Line'' report, documented the need to
double rural transit assistance. This report stated that $191 million
will be needed to replace or rehabilitate existing public transit
vehicles, and $194 million will be needed to replace or rehabilitate
specialized rural transit vehicles.
We believe that it is critical to strive to meet current and future
transit needs in rural America, particularly as the Nation's elderly
population increases in the coming years with the aging of the Baby
Boomer generation. Citizens in rural areas will need access to
shopping, medical, and other activities, particularly when they are no
longer able to operate an automobile.
AASHTO supports the SAFETEA proposal to increase funding for rural
transportation (FTA Section 5311 program).
Transit Bonding Proposal
AASHTO is aware of a concept being considered in the Senate Finance
Committee to move most funding under the Mass Transit Account of the
Highway Trust Fund to the Highway Account, and then fund transit for
the most part through a bonding program.
As indicated earlier, AASHTO believes that the current funding
structure under TEA-21, in which Highway Trust Fund revenues are split
with 80 percent credited to the Highway Account and 20 percent credited
to the Mass Transit Account is working well and should be retained. The
Federal transit program needs a stable source of guaranteed funds from
the Mass Transit Account of the Highway Trust Fund and the General Fund
in order for decisionmakers to commit to expensive transit solutions.
The current arrangement under TEA-21 provides a stable, more
predictable environment for planning, programming, and constructing
these key transit projects.
Mr. Chairman, the State transportation officials across the country
and the AASHTO staff are available to work with you, the Members of
your Committee and your staff in the vital work of reauthorizing the
Nation's highway and transit legislation for the coming 6 years. Thank
you again for holding this important hearing.
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PREPARED STATEMENT OF ROBERT MOLOFSKY
General Counsel, Amalgamated Transit Union
June 10, 2003
Mr. Chairman, Senator Sarbanes, and Members of the Committee, thank
you for the opportunity to testify today on behalf of the Amalgamated
Transit Union (ATU). My name is Robert Molofsky. I have been General
Counsel for the ATU since 1996. Prior to becoming General Counsel, I
served as ATU's Legislative and Political Director for 15 years. The
Amalgamated Transit Union is the largest labor organization
representing public transportation, paratransit, over-the-road, and
school bus workers in the United States and Canada, with nearly 180,000
members in over 270 locals throughout 46 States and nine provinces.
For 111 years, ATU has been proud to serve the mobility needs of
Americans, playing an important role in most legislative efforts
affecting the public transportation industry during the past century,
from requiring closed vestibules for streetcars in the 1890's, to the
creation of a Federal role for public transportation in
1964, to passing the Intermodal Surface Transportation Efficiency Act
of 1991 (ISTEA) and the Transportation Equity Act for the 21st Century
(TEA-21), which recognized that local communities should be primarily
responsible for the transportation choices that ultimately affect them.
Our century-long commitment to transit safety and security issues has
led to many of the innovative improvements within the industry,
including better bus designs and braking systems, exact fare, and
Federal penalties for assaulting public transportation workers. And we
have championed the need for increased funding and expanded service at
the Federal, State, and local levels.
We are pleased to offer our views on the Bush Administration's
surface transportation reauthorization proposal, the Safe, Accountable,
Flexible, and Efficient Transportation Equity Act of 2003 (SAFETEA),
while also presenting some of ATU's core principles in connection with
TEA-21's renewal.
Overview
SAFETEA is certainly a thoughtful and creative document, which
generally keeps current Federal transit programs intact. It also
recognizes that we are well beyond the debate of whether to link the
transit programs with the Federal highway programs by seeking an
integrated transportation planning process. The proposal serves as a
suitable platform from which to launch the discussion of which programs
should be retained and what other new initiatives should be created.
Nevertheless, because the legislation is so incredibly underfunded,
the many laudable goals set forth in the Administration's bill simply
will not be able to be met. Most significantly, despite its logo--
``SAFE''TEA--the legislation falls well short of providing the
resources necessary to continue the provision of safe and secure
transit service for the millions of Americans who rely on public
transportation each day.
Finally, the bill would eliminate or consolidate a number of very
important and successful programs, and curtail some crucial program
requirements, including
certain labor requirements, without any justification. ATU has major
concerns regarding the Administration's proposals relating to (1) the
Bus Capital Program; (2) Federal matching ratios for New Starts; (3)
the Job Access and Reverse Commute Program (JARC); (4) the structure of
the New Freedom Initiative; (5) safety and security requirements; and
(6) certain labor issues. We also offer a number of recommendations to
improve the planning process, increase State transit funding,
coordinate the delivery of specialized transportation services, and
train personnel in connection with new technologies and maintenance
requirements that are associated with keeping the Nation's public
transportation fleets in working condition.
Bush Administration Proposal
Funding
Mr. Chairman, in examining the Administration's transit proposal,
there are two levels of funding to keep in mind: The proposed
guaranteed levels for transit, and the proposed fully authorized levels
(combined guaranteed and nonguaranteed authorization levels). Since
fiscal year 1998, the Federal transit program under TEA-21 has been
funded only at the guaranteed level on an annual basis (except in
fiscal year 1999 when the actual appropriation exceeded the guarantee
by $25 million). For example, for the current fiscal year, the program
was funded at $7.2 billion, the guaranteed level under TEA-21, rather
than the fully authorized level of $8.2 billion. If this practice
continues, which is likely in the current fiscal climate, appropriators
will continue to fund the program at the guaranteed level during the
next 6 years.
Therefore, with regard to SAFETEA, it is only necessary to look at
the Administration's proposed guaranteed levels for transit. We have
included a chart at the back of our full written testimony which
indicates that for fiscal year 2004, the Administration is proposing a
guaranteed level of $5.9 billion for the transit program, which is a
$1.3 billion cut from the current fiscal year. The guaranteed funding
level in SAFETEA for fiscal year 2004 is 17.9 percent less than the
guaranteed funding level in TEA-21 for fiscal year 2003. In fact, under
SAFETEA, the Administration would not even reach the current level of
spending by the end of the reauthorization period. Guaranteed public
transit funding would be 8 percent less in fiscal year 2009 than it is
in fiscal year 2003!
During the past 2 years, this Committee has conducted numerous
hearings on the success of TEA-21's guaranteed, increased funding
levels, and the impact the program has had on transit ridership,
planning, and the overall growth of the Nation's transit systems. The
Administration's funding proposal, if enacted, would not only reverse
these trends but also cripple our transportation system.
Ironically, because of its proposed devastating funding cuts for
transit, the legislation which is called ``SAFE''TEA would negatively
impact the ability of transit systems to upgrade rolling stock and
safety and security measures, causing the public transportation
industry to jeopardize its reputation as the safest mode of surface
transportation in the United States.
SAFETEA Eliminates Successful Programs; Creates Unnecessary
New Programs
Under SAFETEA, the Bus Capital Program would be eliminated, and the
JARC Program would be distributed by a formula. It is not clear why the
Administration is recommending the elimination and consolidation of two
of the most successful programs under FTA's jurisdiction. Under current
practice, Congress selects specific projects for funding from requests
submitted by eligible recipients. This process is the best way to
ensure that large, medium, and small transit systems can replace
equipment and provide much needed service in their communities. ATU
supports maintaining the Bus Capital Program and JARC as allocated
programs.
SAFETEA would also create a New Freedom Program to provide grants
to recipients for new transportation services and transportation
alternatives beyond those required by the Americans with Disabilities
Act (ADA) of 1990, including motor vehicle programs that assist persons
with disabilities with transportation to and from jobs and employment
support services.
ATU fully supports the principles set forth under this proposed
program. However, the best way to achieve these goals is by expanding
fixed route and paratransit services in coordination with the already
existing JARC Program. Through the FTA, the Federal Government has
already invested in ADA paratransit and JARC, and it would be more
efficient to expand the JARC Program with an emphasis on people with
disabilities than to allow separate special purpose systems to be
subsidized.
In addition, the reauthorization of TEA-21 offers a real
opportunity to tap into already available funds from other Federal
agencies. Public transportation can make a difference in how people get
to jobs, health care, training, and other social services. Every dollar
dedicated to human services transportation by transit agencies can be
stretched further if coordination is implemented at the Federal level
and encouraged at the State and local levels.
In addition to 10 DOT programs, there are at least 12 Department of
Health and Human Services (HHS) programs that together are providing
approximately $10 billion annually to assist transportation systems to
provide access for persons with special transportation needs. Moreover,
the two major Department of Labor (DOL) programs, Welfare-to-Work and
Temporary Assistance for Needy Families (TANF), may also be tapped for
transportation purposes. The potential benefits from coordinating
transportation services can be significant. Benefits include increased
service levels, better quality of service for riders, cost savings,
upgraded maintenance programs, more professional delivery of
transportation services, and safer transportation services.
Transit Security Issues
ATU applauds the Administration's proposal in SAFETEA to expand the
definition of ``capital project'' to include not only capital security
needs, but also noncapital, security-related training, and drilling,
thereby authorizing formula grant expenditures for these purposes.
While expanding the definition of ``capital project'' is a step in the
right direction, there absolutely must be a separate, dedicated source
of funds available to transit systems solely for security purposes,
frontline transit employee training in particular.
According to a recent report by the General Accounting Office
(GAO), issued in response to a request from this Committee, the most
significant challenge in making transit systems as safe and secure as
possible is the difficulty financially strapped transit agencies are
having in obtaining sufficient funding. The American Public
Transportation Association (APTA) estimates this funding need to be
over $6 billion. As I will discuss later in my testimony, Congress must
call on the Department of Homeland Security to dedicate the necessary
resources to assist transit agencies in their security efforts.
SAFETEA further proposes to authorize FTA to investigate security
concerns and to withhold funding if necessary to compel a transit
system to make necessary security improvements. While this proposal
addresses an obvious need for FTA oversight and direction of security
matters at transit agencies, it does not go nearly far enough to ensure
that systems are taking all the necessary steps.
As we have stated to this Committee before, there must be specific
legislative and regulatory requirements with respect to the equipment,
technology, training, and personnel needed to prepare, prevent, and
respond to any terrorist attacks or threats. The GAO recognized this
need in its report, stating that ``goals, performance indicators, and
funding criteria need to be established to ensure accountability and
results for the Government's efforts'' (GAO-03-263). Failure to meet
these minimum requirements should result in the withholding of FTA
funds in an amount determined by the Secretary.
Equity Issues
Federal Matching Ratios
SAFETEA would statutorily set the maximum Section 5309 share for a
New Starts project at 50 percent. The current maximum is 80 percent.
Deputy Secretary Jackson has justified this recommendation by noting
that ``all forms of transportation must face the hard reality that
Federal financial resources are not boundless and cannot fully fund
every meritorious transportation need.'' Yet, under SAFETEA, the
maximum share for highway projects would remain at 80 percent.
Having identical matching requirements between the highway program
and the transit program provides communities with the opportunity to
decide on future transportation projects without having to consider the
issue of the Federal contribution. The Administration's proposal
violates the spirit of both ISTEA and TEA-21, which were structured to
finally give communities an unbiased choice by placing highways and
transit on a more equal playing field. The policy of allowing for an 80
percent Federal match for highways while cutting the Federal limit for
transit New Starts to 50 percent is backward thinking. A recent GAO
report confirms that ``officials from several MPOs stated that a cap on
New Starts funds could influence their selection of highway over
transit projects since the decisions are often affected by the
availability of funds from various Federal programs and which projects
will receive the highest Federal share'' (GAO-02-603).
Congress should reject this approach. ATU supports preserving the
Federal-State/local funding matching ratio for transit New Starts at
the TEA-21 level of 80 percent/20 percent, the same level that
currently exists for highway construction, to ensure that communities
can make their own choices about their future transportation plans.
Commuter Benefits
Under current tax laws, the monthly cap on employer provided tax-
free parking benefits is $190, but the monthly limit on employer
provided tax-free transit passes is only $100. SAFETEA would do nothing
to change this imbalance, which encourages people to continue to drive
to work alone. This especially affects people who ride the Nation's
oldest and far reaching transit systems, where monthly fares to travel
between suburban and urban areas reach well over $100. Suburban bus,
heavy rail, and commuter rail riders should be rewarded--not
penalized--under the tax code for choosing to ride transit rather than
driving to work.
Under the transit pass program, everyone wins. Employees do not pay
Federal income tax on transit commuter benefits, and employers can
deduct their costs for providing such benefits, and avoid payroll taxes
on such benefits, regardless of who pays. TEA-21 proved that when you
pay people to ride transit, they will indeed leave their cars at home.
ATU supports raising the monthly cap on employer provided tax-free
transit benefits to the level allowed for parking benefits to encourage
more people to ride public transportation.
Labor Issues
The U.S. public transportation industry has experienced remarkable
labor relations stability during the 40 years of the Federal transit
program. This has allowed transit employees to go about the business of
their most important role: Moving America Safely. The basis for five
decades of this labor-management partnership is Section 5333 (b) of
Title 49 of the United States Code (formerly Section 13(c) of the
Federal Transit Act), which states that when Federal funds, most
recently authorized under TEA-21, are used to acquire, improve, or
operate a transit system, there must be arrangements to protect the
rights of affected transit employees.
Every surface transportation reauthorization bill enacted since
1964 has been linked to a strong labor policy that provides employee
protections for public transit workers. Today, as in the past, ATU's
support for reauthorization will be contingent on the continuation of
those policies and their application to any new programs or innovative
finance mechanisms created through the new bill. The value of this
historic link between a strong transportation bill and sensible labor
policy has been clearly recognized by the Administration, which has
recommended the retention of the crucial Section 13(c) labor
protections for the major formula (49 U.S.C. 5307) and Capital
Investment Grant (49 U.S.C. 5309) Programs.
SAFETEA would also apply Section 13(c) to the majority of the small
and medium size programs under the current legislation as well as the
proposed new FTA Programs. However, SAFETEA raises serious questions on
the mechanisms chosen to apply (and potentially waive) 13(c) in
connection with such programs. By proposing a new waiver process for
labor protections in certain programs, the Administration's bill would
create inconsistencies and gaps in 13(c) coverage throughout the
Federal transit program.
In 2000, this Committee requested an in-depth study of the Section
13(c) Program, embodied in a November 2001, GAO report entitled Transit
Labor Arrangements: Most Transit Agencies Report Impacts Are Minimal
(GAO-02-78), which supports the ATU's long-held notion that the provision
does not substantially delay the flow of capital for transit projects.
GAO surveyed more than 100 transit agencies in the United States,
who overwhelmingly reported that Section 13(c) has had only a minimal
impact on (1) labor costs, (2) the ability to adopt new technologies,
and (3) the ability to modify transit operations. In fact, more than 70
percent of transit agencies indicated that certain other Federal
requirements, such as compliance with the ADA, were far more burdensome
than Section 13(c). Most significantly, the report notes that an
overwhelming majority of the transit agencies have been satisfied with
the timeliness of FTA's grant processing, confirming a 2000 GAO report
which found that 98 percent of the DOL's applications were processed
well within the 2-month period required by the Agency's new guidelines.
Given the overwhelming conclusions of the GAO reports, we do not
see the FTA's justification for proposing to curtail the labor
protection requirements of the Federal Transit Act for certain existing
and proposed new programs.
The Administration calls for the implementation of the DOL
specially designed warranty arrangement (in which grants are labor
certified without a referral) and possible waiver options in connection
with 13(c) for certain existing programs, such as the JARC Program, the
5311 Rural Program and the Over the Road Accessibility Program. In
addition, the bill calls for a possible waiver of 13(c) for the entire
5310 (Elderly and Disabled) Program. SAFETEA would also create a
possible waiver of 13(c) for new programs, such as the Indian
Reservation Rural Transit Program, and the above mentioned New Freedom
Program.
With regard to the JARC Program, under current law, entities
receiving JARC grants must comply with the full transit-labor
certification process under 13(c), with the exception of JARC grants to
applicants serving populations under 200,000, which are labor certified
by using the warranty. There is no support or justification for
changing the grant procedures under this program. Since the 1999
regulations were released, and the separate procedures were set for
applicants based on population, there have been no problems regarding
this program. The new time limits are working perfectly, and no JARC
grants have gone unfunded because of 13(c). The current coverage should
be maintained without a new waiver option.
Similarly, the warranty has worked well under the 5311 Rural
Program, and could be just as easily applied under the proposed Indian
Reservation Rural Transit Program proposed as part of 5311. There is no
reason for statutory language calling for a waiver regarding this
program.
Other Labor Issues
Also, SAFETEA would create a new Intermodal Passenger Facilities
Program which perhaps inadvertently does not include 13(c) coverage.
The program, if enacted, should of course include 13(c) coverage.
Moreover, without a properly funded bill, we do not support funding for
this program from the Mass Transit Account.
Finally, the bill would allow DOT to waive 13(c) requirements for
certain demonstration projects and projects involving new technology.
There is no evidence of any demonstration projects or other projects
involving new technology having been negatively affected by Section
13(c). In fact, the opposite is true. Section 13(c) is the basis for
five decades of labor-management cooperation in the transit industry,
allowing for major technological advances.
Charter Bus Service
SAFETEA maintains the current restrictions on public transit
agencies that permit them to provide only a limited amount of charter
service within their service areas and proposes to enforce these rules
by allowing the Secretary to withhold Federal funds in the event of a
violation.
It is important that any revisions of the charter service
regulations take into account the increasing concerns of those in both
the transit and intercity bus industries that the existing rules are
not only cumbersome and confusing, but are also serving to create an
adversarial method of decisionmaking that is harmful to those seeking
charter service. In addition, it must be recognized that while the
current regulations grew out of concern that without restrictions, the
allocation of Federal funds to public agencies would create unfair
competition with the private charter bus industry, private operators
today are receiving significant amounts of Federal funding as well.
Certain minimal exceptions have been established by FTA to respond
to transit agency requests to serve elderly persons and individuals
with disabilities. We support further efforts to reform the charter bus
regulations to permit public agencies to provide, upon request, a
limited range of charter bus service to nonprofit and governmental
organizations within their service areas.
Based on our discussions with public transit agencies and
representatives from the private bus industry, we believe a new, more
effective, streamlined set of regulations can be crafted which protect
the economic interests of the private bus industry while at the same
time allow public agencies to respond to community-based charter
service requests.
Congressional support for this ongoing effort would greatly enhance
the likelihood of an agreement between the parties and provide a basis
for establishing sensible revisions.
ATU Proposal
Mr. Chairman, the ATU's entire TEA-21 reauthorization proposal is
included in this book, entitled Next Stop: Real Choices.* I will
summarize the most important aspects of the proposal.
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*Held in Committee files.
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The proposal is a comprehensive plan which contains the ATU's
recommendations on major policy, fiscal, and structural issues in
connection with the Federal transit program for the first decade of the
21st Century. ATU's reauthorization plan calls for the continuation of
a strong Federal role in connection with providing the resources
necessary to maintain and improve the quality of America's public
transportation systems.
While we consider all parts of the proposal extremely important,
the following are the seven core principles and ideas that we believe
should be an essential part of the reauthorization bill:
Increased, Guaranteed Transit Funding
ATU has joined APTA in its recommendation for increasing Federal
transit funding by 12 percent annually, so that by fiscal year 2009,
the program would be funded at a guaranteed level of $14.3 billion. In
order to reach this level, ATU supports raising and indexing the
Federal gas tax as recommended by leadership of the House
Transportation and Infrastructure Committee. ATU also supports
bipartisan proposals to draw down reserves in the highway trust fund,
and collect the interest on fund reserves.
In addition, we call for the preservation of the firewalls (for the
entire Federal transit program) that ensure guaranteed funding for the
program on an annual basis. Moreover, we support maintaining the needs-
based formulas which determine transit funding. Congress should reject
any so-called ``equity'' proposals that would cap transit funding for
any one State at a certain level or percentage. We also
support increased funding for flexible transportation programs, such as
the Congestion Mitigation and Air Quality Program (CMAQ), which have
allowed communities to meet expanded transit needs where traditional
funding sources have not been adequate.
Finally, Congress should oppose any transit funding proposals that
would break the historic link between highway and transit funding and
decrease transit's share of the Federal motor fuel tax. For example, a
draft proposal under consideration at the Senate Finance Committee
would redirect gas tax funds currently earmarked for transit to pay for
highway construction by decreasing transit's share of the gas tax to a
half-cent. The rest of the Federal transit program would be financed
through an unproven bond scheme. Financing public transportation with
bonds is a proposal to make an essential element of our transportation
system dependent on an untested, destabilizing funding source.
This approach will require ever-increasing borrowing, at a greater
cost to taxpayers, and destabilize future transit investments. Removing
dedicated funds for transit undermines the long-term viability of our
public transportation systems, ultimately placing the economy,
metropolitan areas, transit-dependent populations, and air quality at
risk. Further, separating the funding sources could erode the linked
planning process, which addresses environmental issues affecting both
the highway and transit programs.
The guaranteed funding provisions of TEA-21, which link transit
funding to the Federal motor fuel tax, have provided an unprecedented
degree of stability within the public transportation industry since
1998. Ridership levels are at their highest point since 1960, and ATU
membership has grown to more than 180,000, the highest in the 111-year
history of our union. ATU certainly supports increased highway funding
and the equitable resolution of the donor-donee issue, but placing
transit funding at risk is not the best solution.
Flexibility Incentive Grant (FIG) Program
ATU is proposing a new transportation initiative in connection with
the reauthorization of TEA-21. The idea behind the program named--the
Flexibility Incentive Grant (FIG) Pilot Program--is to provide
incentives that would encourage States to establish new sources of
revenue for transit projects and services and to reward States for
creating more flexibility in the use of their existing transportation
funds.
The FIG Program is also designed to encourage States to think twice
before cutting transit funding in the face of rising fiscal pressures by
providing ``bonus'' Federal transportation dollars to those States that
increase public transportation funding or take steps to increase
funding. Significantly, States could use funds derived under the FIG
Program for any highway or transit projects eligible for assistance
under Title 23 or Chapter 53 of Title 49.
Under the proposed FIG Program, the Secretary of Transportation
would be authorized to allocate $5 million annually to each State that
increases transit expenditures by at least 10 percent as compared to
the previous fiscal year. If a State is already expending more than $1
billion on public transportation, the Secretary would be authorized to
allocate $10 million to such State if it increases transit expenditures
by at least 1 percent.
In addition, States would be eligible for grants on the condition
that they create new dedicated sources of revenue for public
transportation. Such sources may include the dedication of new State
motor fuel taxes, sales taxes, interest on existing highway funds,
motor vehicle excise taxes, tolls, loans to be made out of highway
funds, or other sources of funding.
Finally, in order to encourage flexibility in the spirit of ISTEA,
as continued under TEA-21, the FIG Program would authorize the
Secretary of Transportation to reward States for amending their
existing statutes or constitutions to allow funds that are currently
restricted for highway purposes only to be eligible for transit
projects and services as well as highway purposes.
The FIG Program would not affect existing formulas under which
States receive transportation funds through Title 23 or Chapter 53 of
Title 49; it would be a ``bonus'' program to be awarded in addition to
any funds received through those sources. Also, the Program would be
funded out of General Funds and therefore would not put further
pressure on the Federal Highway Trust Fund.
The FIG idea is, of course, just one very small initiative in the
context of the massive highway/transit bill. Nevertheless, ATU believes
the idea has a great deal of merit because it seeks to unlock billions
of dollars in State resources, each year, for public transportation,
community and rural transportation, and ADA services. A draft
legislative proposal is available for your review.
Transit Safety and Security
This Committee knows the severity of the security threat facing our
Nation's transit systems today. Given that one-third of terrorist
attacks worldwide target transportation systems and that transit
systems are the mode most commonly attacked, it is imperative that the
Federal Government expand its role in securing transit systems--through
the establishment of national standards for transit security and the
provision of Federal funds to assist agencies in meeting these
standards.
Currently, only rail fixed guideway transit systems are required,
as a condition of FTA funding, to adopt a safety and security plan.
There is no similar requirement for transit bus systems. At a minimum,
all transit systems, bus and rail, should adopt a security plan to be
overseen and implemented by a system security committee, including both
management and employee representatives, and all systems must provide
security and emergency management training for frontline transit
employees, including vehicle operators and maintenance employees.
Security training for frontline transit employees is not only
necessary in today's environment, but is one of the most cost-effective
measures that an agency can take to better protect the nine billion
passengers riding transit each year, as well as more than 350,000
transit employees. Despite this, a recent survey of ATU members showed
that 80 percent of respondents reported that they had not received any
security training from the employer.
It must be recognized that frontline transit employees, including
bus and rail operators and maintenance employees, are the eyes and ears
of every transit system. These employees, with the appropriate
training, can be crucial in deterring, diffusing, and responding to
serious security incidents that occur aboard their vehicles and within
transit stations or facilities. In addition, transit employees are
often the first line of defense in a terrorist incident, offering
protection and much needed transportation away from terrorist targets
and disaster sites. For these reasons, FTA should require all transit
systems to provide comprehensive training for their employees on a
regular basis. Training programs developed by the National Transit
Institute in conjunction with FTA, APTA, and the ATU are a good model
of the type of training necessary.
As I noted in my comments on the Administration's proposal,
financially strapped transit systems across the United States have been
unable to gather the resources to fund necessary security training and
improvements. It is imperative that the Department of Homeland Security
(DHS) and its Transportation Security Administration dedicate
sufficient resources for such purposes.
Given the extensive expertise of the FTA and the countless
security-related initiatives undertaken by the Agency in the past few
years, it is important that funding from DHS be distributed only after
appropriate consultation and coordination with FTA, including analysis
of FTA readiness assessments. In order to facilitate such coordination,
Congress must call on DHS and FTA to enter into a Memorandum of
Understanding expeditiously so that any available funds can be
distributed effectively and efficiently.
A Real Voice In Transportation Planning
Unfortunately, transit riders, environmentalists, pedestrian and
bicycle groups, businesses, transit workforce and industry
representatives, and other individuals with a direct stake in
transportation planning in reality have no real voice with regard to
the metropolitan planning organizations (MPOs) that control their
future. Under current law, MPOs, serving as the transportation planners
for every U.S. urbanized area with a population of more than 50,000,
and determining the future of our communities for decades, are composed
of only local elected officials, officials of public agencies that
administer major modes of transportation, and appropriate State
officials, often with competing political and transportation interests.
Although representatives of mass transportation authority
employees, along with the general public, are given a reasonable
opportunity to comment on long-range plans, they are not afforded a
seat on the board, and they certainly have no voting rights. In fact,
by the time riders, workers, and residents are permitted to submit
comments at all in connection with long-range transportation plans,
extensive research, and consultation with State representatives has
taken place, and plans are already in their final stages. No
opportunity to submit comments, or any other public procedure, is
required during the drafting stages.
This is an outdated process. These constituency groups would, as
intended in the original process, bring a real world and informed
perspective to the MPO boards, with a real ability to be heard and
effect the decisionmaking process.
Public transportation workers in particular would be helpful on
issues involving transit operations and the implementation of new
technology. ATU supports the diversification of MPO boards, requiring
MPOs to appoint transit workforce representatives, minority groups,
transit riders, bicycle and pedestrian advocates, businesses, and
others with a direct stake in the provision of public transportation
services to sit on such panels, with the right to vote. We also support
requiring the governors to appoint these representatives for statewide
planning. Finally, we support the ability of the general public to view
long-range plans and submit comments during the early research and
development of such plans, rather than after a draft has been
completed.
Transit In National Parks (TRIP)
Congestion in our national parks has reached massive proportions.
The 384 units of the National Park System drew approximately 300 million
visitors in 2001, and the National Park Service expects demand to increase
by 500 percent over the next 40 years. The millions of Americans who escape
urban congestion by visiting national parks each year are greeted by
dim, hazy vistas and unhealthy air instead of the expansive views and
scenery that have made these areas our national treasures.
The piecemeal approach to solving the serious congestion issues in
our parks is simply not working. ATU supports the adoption of S. 1032,
the Transit in Parks Act (TRIP), which would provide increased funding
for mass transportation in certain federally owned parks, as part of
TEA-21's reauthorization. Without question, this legislation begins to
address the major congestion and environmental issues that currently
exist in U.S. National Parks from coast to coast.
Public Transportation Workforce Development Programs
While the transit industry has effectively focused on the
development of rail infrastructure and rolling stock, there has been a
lack of attention directed toward training personnel in connection with
new technologies and maintenance requirements that are associated with
keeping the Nation's public transportation fleets in working condition.
The public transportation industry desperately needs job training and
career ladder programs to provide workers skills necessary to carry out
maintenance tasks in a cost effective manner. It also needs to provide
training and technical assistance to individuals who are interested in
commercial driving careers.
The Transit Technology Career Ladder Partnership (TTCLP) was
launched in 2001 with a seed grant from the DOT and the FTA. Working
through the nonprofit Community Transportation Development Center, the
program has assisted local transit systems and unions to jointly
develop transit training partnerships in five pilot locations. These
locally sponsored partnerships have already raised eight times more
State and local funding than originally invested by DOT in the pilot
program. ATU and the Transport Workers Union call for the program to be
funded at a level of $1.76 million in fiscal year 2004, to increase to
$2.5 million by 2009, as the program expands to more States. ATU
supports TTCLP as an integral part of the reauthorization of TEA-21 to
provide training and technical assistance to individuals who are
interested in commercial vehicle driving, maintenance, or other careers
within the transit industry.
Meeting Community Transportation Needs
As recommended by the Community Transportation Association of
America (CTAA), the Committee should recognize that an increase in
capital investment is long overdue for rural and small-urban transit
organizations, which provide critical mobility services outside of
America's largest regions. More than one-third of America's population
lives outside of urbanized areas. The agencies involved in Section 5311
services enjoy strong community support, providing more than 340
million passenger trips per year. However, more funds are needed to
keep up with expanding services. The existing fleet is far older than
typical useful life projections, and agencies are falling behind
vehicle replacement suggestions. Moreover, the reauthorization bill
should address the serious lack of services in rural America, which
impacts disproportionately on persons with disabilities and low-income
people, who are particularly transit dependent. Thirty-two percent of
all rural residents are classified as transit dependent, including 36
percent of all rural Americans living in nonmetropolitan areas.
Guaranteeing access for America's most transit dependent population
should be a priority in the next reauthorization.
Conclusions and Observations
In summary, ATU's message to the Committee is simple: TEA-21 has
been an enormous success. Let us build off the progress of ISTEA and
TEA-21 by maintaining and increasing the Federal investment in the
existing transit programs and policies that have forever changed the
travel patterns of America's communities, both large and small.
Additionally, Congress should properly fund required security and
employee training programs and adopt appropriate new programs,
especially those that have the potential to encourage more transit
investment from nonfederal sources, so that we may finally narrow the
ever-widening gap between transit needs and transit investment.
Finally, let us provide those with a direct interest in transportation
services with a real voice and an expanded role in connection with
transportation planning so that the ideals that were set out in ISTEA
and TEA-21 may finally be realized.
We realize of course, Mr. Chairman, that without adequate
resources, none of the reforms proposed by the Administration, the
Members of this Committee, or any of the organizations represented on
this panel can be fully reached. And, whether Members of Congress agree
on the concept of a gas tax increase or not, it should at least be
clear to lawmakers on both sides of the aisle and in both Chambers that
increasing the gas tax is the best possible way to meet the extensive
highway and transit needs of this Nation. Congress will not be able to
solve the issues of donor/donee distribution, training, safety,
research and development, or underwrite service expansion unless the
gas tax is increased. Otherwise, as is the case with the
Administration's proposal, we will end up with a situation in which
crucial programs will be eliminated or consolidated so that limited
resources may be shifted elsewhere.
It is for these reasons that ATU supports raising the Federal gas
tax as recommended by leadership of the House Transportation and
Infrastructure Committee. Each penny of the motor fuels excise taxes
currently yields over $1.7 billion per year, generating more than
80,000 jobs in the transportation industry, with about $1.4 billion
being deposited into the Highway Account of the Highway Trust Fund and
$350 million deposited into the Mass Transit Account. The Federal motor
fuels tax is currently 18.4 cents, and has not been raised since 1993.
With unemployment at an 8-year high and 1.7 million workers
unemployed for more than 6 months, President Bush and the Congress
should approve a plan that will create jobs in our communities and
ensure that our future transportation needs are met. As a bipartisan
group of 43 U.S. Senators recently stated in a letter to the President,
``a robust public transportation infrastructure is vital to continuing
America's economic growth.''
We believe it is time for a frank debate on this matter. It is not
a contradiction to support the President's tax cuts while calling for
an increase in gas tax revenues. Whether an individual earns more than
$300,000 or less than $30,000 annually, each person gets the same seat
on the bus or the train. Moreover, just as the new tax bill is a
balance of tax cuts and loophole fixes, a transportation bill with a
gas tax increase will net out as a gain for all taxpayers. Supporters
of the tax cuts have said that eventually the money people save will
wind up back in the economy. Similarly, a gas tax increase will put
more cash in everyone's pockets--money saved from reducing the
overwhelming burdens of traffic congestion. According to the Texas
Transportation Institute, in 2000, congestion (based on wasted time and
fuel) cost about $68 billion in 75 urban areas. The average cost for
each of the 75 urban areas was $900 million. By providing for even just
a nominal two-cent gas tax increase, which would cost the average
driver a mere $12 per year, or 6-cents per day, we could begin the
process of redirecting at least a portion of that $68 billion back into
the economy.
We know that one mechanism alone cannot provide the necessary
resources to maintain and improve the conditions of the Nation's
highway and transit systems. ATU has and will continue to support
innovative finance mechanisms in addition to (but not in lieu of) the
gas tax, such as State Infrastructure Banks, TIFIA, and bonds with
labor protections, including Section 13(c) and Davis Bacon, attached to
directly funded projects as well as those funded in subsequent
generations. However, just as Congress is striving for simplicity in
the tax code, there is no substitute for the basic, time-tested method
of meeting our transportation needs with funds generated directly out
of the transportation system.
Without question, these are enormous challenges, and we are
undoubtedly living in extraordinary times. Yet, ATU firmly believes
that Congress has the means, the will, and the experience to achieve
these crucial mobility goals. The transit industry, in cooperation with
ATU, has certainly come a long way since the 1964 Federal Transit Act.
However, the success of our efforts has produced new challenges that
must be immediately addressed in order for us to sustain the progress
that has been made. ATU looks forward to working with this Committee in
meeting these challenges, so that we may continue to Move America
Safely during the period of the next reauthorization bill, and beyond.
* * *
Fact Sheet: TEA-21 versus SAFETEA
----------------------------------------------------------------------------------------------------------------
TEA-21 FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 TOTAL
----------------------------------------------------------------------------------------------------------------
Fully Authorized Level............. $4.6 $6.3 $6.8 $7.2 $7.7 $8.2 $41
Guarantee.......................... $4.8 $5.3 $5.8 $6.3 $6.7 $7.2 $36
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
SAFETEA FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 TOTAL
----------------------------------------------------------------------------------------------------------------
Fully Authorized Level............. $7.2 $7.4 $7.5 $7.7 $7.8 $8.0 $46
Guarantee.......................... $5.9 $6.0 $6.2 $6.3 $6.5 $6.6 $37.6
----------------------------------------------------------------------------------------------------------------
(Billions of Dollars)
Since fiscal year 1998, the Federal transit program has been funded
only at the guaranteed level on an annual basis (except in fiscal year
1999 when the actual appropriation exceeded the guarantee by $25
million). For example, for the current
fiscal year, the program was funded at $7.2 billion, the guaranteed
level under TEA-21. If current practice continues, appropriators will
continue to fund the program at the guaranteed level during the next 6
years.
Therefore, in examining the Administration's proposal (SAFETEA), it
is only necessary to look at the proposed guaranteed levels for
transit. As the charts indicate, for fiscal year 2004, the
Administration is proposing $5.9 billion for the transit program, which
is a $1.3 billion cut from the current fiscal year. In fact, under
SAFETEA, the Administration would not even reach the current level of
spending by the end of the reauthorization period. Guaranteed public
transit funding would be 8 percent less in fiscal year 2009 than it is
in fiscal year 2003!
----------
PREPARED STATEMENT OF HARRY W. (WOODY) BLUNT, JR.
President, Concord Coach Lines
Concord, New Hampshire
on behalf of the American Bus Association
June 10, 2003
Good morning, Mr. Chairman and Members of the Committee. My name is
Harry Blunt and I am President of Concord Coach Lines, a private over-
the-road bus company based in Concord, New Hampshire, that provides
service in New England. Concord Coach Lines and its affiliate,
Dartmouth Coach are one of the largest independent motorcoach companies
in New England. We provide daily intercity service to Boston and Logan
Airport from 34 cities and towns in Maine and New Hampshire. Thirty-one
of these cities have no other form of intercity public transportation.
Concord carried 670,000 passengers in 2002 and employs 134 full and
part-time personnel.
I am testifying on behalf of the American Bus Association. The ABA
is the trade association of the over-the-road bus industry. ABA has
3,400 members, of which some eight hundred are motorcoach operators and
200 are tour operators. The
remaining members are hotels, tourist destinations, and attractions. I
am the immediate past Chairman of the ABA's Board of Directors and
currently serve as Chairman of the ABA's policy committee. Before I
begin speaking on our issues with SAFETEA, I would like to present a
few facts about the over-the-road bus industry.
The industry that I have served for over 30 years transports 774
million U.S. passengers each year. We transport more people than the
airlines, and we transport more passengers in 2 weeks than Amtrak does
in a year. Further, we serve more than five thousand cities and towns
in regularly scheduled service, again more than any other mode of
public transportation. Between fixed route, intercity, commuter
service, charter and tour, and airport shuttle service the industry is
involved in the life of virtually all Americans. For example, Eyre Bus
Service, an ABA member, provides commuter service to DC for over 2,500 Maryland residents every day; in addition, intercity bus companies provide fixed route, scheduled service to 79 communities in Alabama. This is far
more than the combined number of communities served by air and Amtrak. A
map detailing this service has been provided to the Committee.* ABA members
provide these services without any meaningful subsidy from the
Government. A report by Nathan Associates, Inc.* details the Federal
subsidies to passenger modes between 1960 and 2001. This report is
dramatic evidence of the lack of subsidy given to intercity bus
transportation. The industry buys its own buses, builds its own
facilities, trains its own personnel and maintains its own equipment.
And since the attack on America on September 11, we have taken our
share of losses.
---------------------------------------------------------------------------
*Held in Committee files.
*Held in Committee files.
---------------------------------------------------------------------------
My subject today is the Administration's bill to reauthorize the
Federal highway bill, the so-called TEA-21. The current bill is called
SAFETEA. Whatever its name, it is a bill vital to the health and well
being of the over-the-road bus industry, and we at the ABA no less than
you on the Banking Committee want to get this right. While there are
many good provisions in the bill that we support, there are also
sections of the bill within the jurisdiction of this Committee that are
largely a disaster for the over-the-road bus industry.
Our first and most important problem with SAFETEA may be summed up
in two words: ``transit competition.'' The private bus industry is
under assault. Today, we face illegal competition from transit agencies
that ignore Federal rules regarding the provision of transportation
services provided by the private bus operators; from transit agencies
that ignore Federal Transit Administration (FTA) cease and desist
orders and continue to provide illegal transportation; from short
sighted policies by local governments like that of the District of Columbia which wants to spend over thirty million Federal dollars to operate a tour
bus service in a city which has three private sightseeing tour operators
that have seen drastic declines in their own business.
In short, we face withering competition from transit agencies that
are provided significant Federal and/or local funding. Agencies that
then take that money and use it against the private operators and
ultimately against the public. The most blatant examples of this
``competition'' are found in the fight to provide ``charter'' service
to the public. When I speak of ``charters'' I mean groups of people
seeking to travel to some destination. Charters form a significant
portion of our business. Indeed, nearly all ABA members provide some
charter services to the public.
FTA regulations require federally funded transit agencies to notify
the local private companies, ABA, and FTA if there is a charter
opportunity that it wishes to pursue. The ABA notifies its members and
FTA regulations require that the publicly funded transit agency allow
the private, unsubsidized operator to provide the service if it is
``willing and able'' to do so. If there is no private operator
available or willing to provide the service, the transit agency is free
to do so.
As ABA has documented, transit agencies often do not follow these
rules. Some transit organizations fail to follow the notification
procedures at all; others provide the service before the determination
of a ``willing and able'' private provider is made. Further, publicly
funded transit agencies often use their heavily subsidized fleets to
charge prices well below cost to win charter work. Most egregiously, as
I referred to earlier, at least one transit agency has ignored two FTA
orders to stop operating its charter service. Not only has it continued
to operate this service, but also the transit agency's only penalty so
far has been FTA's willingness to overlook the continuing violation
while working with it to find a way to allow it to continue to operate.
Reportedly, FTA is accomplishing this by determining that transit
agency's charter service to an annual golf tournament event is a
``regularly scheduled'' service and therefore not charter service. In
the meantime, ABA member Kemp's Bus Service loses revenue from the
event to an outlaw public transit agency and struggles to survive. A
situation the charter rules are intended to prevent.
Where this issue is relevant to SAFETEA is embodied in Section 3020
of the bill. That section would give the Secretary of Transportation
the authority to suspend the charter rules if the transit could say
that it was providing service to the elderly or the disabled. This
section is a dagger in the heart of the charter rules. The essence of
private charters in the United States is the provision of service to
the ``elderly.'' To allow anyone to abrogate the ``willing and able''
test in this circumstance would be to throw out the charter rules.
Creating an exception for ``disabled'' transportation from the charter
rules is no less pernicious. ABA is aware of no instance where disabled
citizens have been denied the use of public transportation. Indeed, the
Americans with Disabilities Act (ADA) spurred Congress in TEA-21 to
establish a fund for private operators to equip their coaches with
wheelchair lifts. The fund has been oversubscribed each year and
currently provides seven million dollars for this purpose. The public
transit agencies cannot say that the private bus operators are failing
to provide transportation to the disabled and the only remedy is to
dispense with the rules.
On the contrary, the charter rules clearly provide that if there is
no ``willing and able'' private operator the business opportunity is
open to all bus operators public as well as private. Any suggestion
that the charter rules are preventing the publicly funded transit
agencies from meeting unmet needs is nonsense.
ABA has three remedies to correct the transit competition
imbalance. First, SAFETEA's Section 3020 must obviously not be enacted.
Second, there must be penalties that make sense when a transit agency
violates the charter regulations. At present, FTA says that its only
remedy for such a violation is to bar the transit from receiving any of
its Federal funding. Not surprisingly, this penalty has never, and in
my opinion, will never be used. In place of this nonexistent penalty,
we suggest a penalty of a percentage of the transit is funding for the
first violation of the charter rules, a greater percentage for a second
violation, and so on. And third, the industry needs clear definitions
of ``charter service'' and ``sightseeing service.'' It cannot be that a
once a year charter (for example, the Alabama-Mississippi football
game) is a regularly scheduled event. If any agency can sustain such a
definition than there are no charter rules.
At the end of my testimony, I have appended ABA proposals to change
SAFETEA's Section 3004 and amend 49 U.S.C. 5302 and SAFETEA's Section
3020 and revise 49 U.S.C. 5323(d). These proposals define charter bus
and sightseeing bus transportation and add a complaint process and
workable penalties to the FTA tool kit in addressing this problem. The
``bright line'' definitions are designed to eliminate the confusion
that seems to overcome the public transit agencies when charter bus
operations are offered, the complaint process and penalty provision
will give parties a forum within which problems arising out of charter
opportunities can be resolved.
An important problem for the bus industry and the Nation is
SAFETEA's halfhearted solution to equipping buses with wheelchair
lifts. This problem is embodied in Section 3036 of the bill. TEA-21
authorized funding to meet the Federal mandate requiring wheelchair
lifts on all fixed route over-the-road and charter motorcoaches. The
Transportation Research Board (TRB) has put the annual cost of the
mandate at forty million dollars. However, the wheelchair lift program
over the life of TEA-21 has been funded at approximately 15 percent of
its annual cost. To put one wheelchair lift on a new or used bus costs
between $35,000 and $40,000. In our industry, where the majority of our
operators have 10 or fewer motorcoaches, the cost of this mandate is
prohibitive. As I noted previously, the wheelchair lift program is
oversubscribed each year. An increase to at least 50 percent of the
mandate's cost is warranted and necessary.
A second problem with SAFETEA is found in Section 3011, the ``New
Freedom'' program. This program establishes a competitive grant program
which will provide funds for ``new transportation services and
transportation alternatives beyond those required by the Americans with
Disabilities Act of 1990 (42 U.S.C. 12101 et seq.), including motor
vehicle programs that assist persons with disabilities with
transportation to and from jobs and employment support services.''
While we obviously applaud more funds for transportation for the
disabled, we believe the initiative is wrong in its insistence on ``new
transportation services and alternatives.'' As drafted, it excludes the ability of any grant recipient to fund wheelchair lifts on buses, even
while allowing the purchase of motor vehicles. Wheelchair lifts are the
method by which the overwhelming majority of physically disabled citizens
get to work; to not fund this tried and true method would, I believe, disadvantage many of our citizens in the service of this ``new freedom.''
In sum, ABA believes that funding for wheelchair lifts should be allowed
under this section.
Also regarding the New Freedom Initiative, Section 3034 of SAFETEA
allows the grants to be increased depending on increases in the
efficiency of the transportation service offered. We suggest that the
program be modified to allow the Secretary to consider cost reductions
in determining efficiency.
In Section 3002 of SAFETEA the term ``mass transportation'' is
replaced with ``public transportation.'' We are concerned that the
change could destroy the primary purpose of Federal transit subsidies,
which is to provide for local transportation services, and expand
funding for those programs beyond that core focus to a broader array of
services in direct competition with the intercity bus industry.
Our concern is due to the fact that ``public transportation,'' as
that term is commonly understood, means ``transportation to the
public.'' Thus, we believe it is possible to interpret the change as
allowing transit funds to be spent, for example, on Amtrak, since the
rail carrier provides public transportation; or to allow transit funds
to be spent to compete with Greyhound Bus Lines in intercity service.
By contrast, the term ``mass transportation'' has a 30-year history of
usage as denoting ``local'' transportation services with no opportunity
to expand range of services a transit agency can provide.
There is a solution. Insert the word ``local'' before ``public
transportation'' in Section 3002. This change would ensure the revised
Section 3002 would not broaden the range of allowed transit services
into providing intercity bus or rail services but rather to concentrate
on the transits' core mission: ``local transit service.''
Less this Committee believe that ABA has nothing good to say about
SAFETEA, one provision we strongly support is Section 6002 and the bus
industry's counterpart H.R. 1394, the Intermodal Transportation Act.
Both H.R. 1394 and SAFETEA propose the creation of a new competitive
grant program for intermodal transportation centers. All modes of
public transportation--intercity bus, intercity rail, urban mass
transit, and rural transit should be linked by intermodal
transportation centers so that seamless public transportation becomes a
reality.
The intermodal transportation center fund, $100 million annually
under H.R. 1394 and $85 million annually under SAFETEA, solves this
problem by providing sufficient seed money to States and communities to
make these intermodal projects happen. Some States, such as my home
State of New Hampshire, have taken the lead in developing intermodal
transportation centers, in cooperation with the private sector. Those
centers, such as the ones in Concord and Portsmouth, have been
tremendously beneficial in enhancing the attractiveness of public
transportation. The proposed transportation center program would enable
other States to do the same.
Another major component of creating a seamless, comprehensive
public transportation system is the need to link rural communities with
the Nation's aviation and rail systems. Thousands of rural communities
need connections to the national air and rail system, yet only a
handful receive such connecting service from the Essential Air Service
program. Buses now provide unsubsidized service to thousands of rural
communities; with relatively little Federal support, existing or new
bus service could link these communities to air and rail hubs.
H.R. 1394 creates a $35 million per year essential bus service
program, which would provide States with funds to contract for public
surface transportation services to link rural communities to airports
and train stations. This program would provide a potential link to the
air and rail systems for the thousands of communities without EAS
service.
Integrating public transportation information systems is another
important part of creating a seamless public transportation network.
Such a system is needed so that with one call or Internet visit,
consumers can access fare, schedule, and location information for all
public transportation modes. This is particularly important for people
with disabilities. Some States and service providers are working toward
this goal, but a coordinated Federal effort is needed. Both H.R. 1394
and SAFETEA have such a program. Frankly, we prefer the H.R. 1394 model
because it separates the information system program from the intermodal
terminal program which we believe would promote administrative
simplicity.
ABA strongly supports the SAFETEA proposal to increase the Section
5311 rural transportation funding by roughly 50 percent. This means a
comparable increase in the Section 5311(f) rural intercity bus program.
Overall, rural transportation providers have been very effective in
providing a great deal of essential transportation with relatively
little funding; the rural intercity bus providers particularly stand
out in this regard. For example, in 2002, Greyhound provided at least
daily, fixed route service to 332 communities with $4.7 million in
Section 5311(f) operating subsidies. This is an exceptionally
productive use of Federal funds. Expansion of 5311(f) will enable
States to do more contracting with intercity bus operators to connect
many more of the thousands of rural communities that are not connected
to the Nation's public transportation network.
A matter related to the intermodal terminal development issue
detailed above is FTA's insistence that FTA intermodal funds can be
used for the transit and intercity rail portions of intermodal but not
the intercity bus portions of such terminals. This is contrary to good
intermodal policy and discriminates against rural communities that rely
on intercity bus service. Indeed, this interpretation is inconsistent
with one of the stated purposes of Section 5309 of the Federal Transit
Act, which is to cover the capital costs of coordinating all forms of
public transportation. H.R. 1394 provides language that clarifies that
FTA funds can be used for all transportation portions of intermodal
transportation centers.
SAFETEA proposes a variety of innovative financing mechanisms in
order to enhance funding sources for new transportation investments, and
there have been various Congressional innovative financing proposals. We
agree that innovative financing can play a role in providing additional
sources of revenue for transportation projects in these tight budgetary
times. One of the Administration's proposals is to broaden the
eligibility for private activity bonds to include highway projects and
surface freight facilities. We believe that intermodal passenger
transportation centers and intercity bus facilities should also be
included as eligible projects, given the important role that they play
in our Nation's passenger transportation network.
There are two final changes to SAFETEA that we urge on the
Committee. First, we suggest that Section 3012, which reauthorizes the
major capital investment program, be amended. The Administration
proposes that the program be limited to a ``New Starts'' program to
provide grants for capital costs incurred when coordinating public
transportation with other transportation, the costs of introducing new
technology though innovative and improved products into public
transportation, and the development of corridors to support public
transportation. However, it is not certain as written that the capital
investment funds can be applied to the intercity portion of intermodal
facilities. Again, at the end of my testimony, I have appended
legislative language taken from H.R. 1394 that would eliminate this
problem.
Second, Section 3010 provides additional ``incentive'' funding for
rural transit agencies that are increasing ridership. The problem here
is that private bus operators that also provide rural transportation
services are not included in the incentive funding. Rural
transportation by private operators is provided under the 5311(f)
program. Simple fairness would seem to insist that if, in providing
service under the 5311(f) program, an operator shows increasing
ridership, that operator should be eligible for such incentive funding.
Moreover, not to do it the ``fair'' way could lead to transit agencies
using their cost advantage to increase ridership at the expense of the
private operators. Thus, private operators would be at a double
disadvantage. First, by the transit's use of its cost advantage to
undercut the private operators, and then its receipt of an incentive
payment for increasing ridership at our expense.
It is fair to say that what has been presented here is a short list
of the problems that SAFETEA presents for the private bus industry.
However short the list, each problem is of enormous significance to the
private bus industry. Like other modes of transportation, the private
operators have lost jobs, operators, and revenue due to the effects of
September 11, the downturn in the economy, and the failure of the
American people to travel as they have in the past. Unlike other modes
there is no significant private bus subsidy and no Congressional
bailout of the industry. We seek none here.
However, we do seek to level the ``playing field'' that we share
with the public transit agencies. We do seek to have FTA treat us in
law and regulation as they do the public agencies. We do seek to
provide the most service to the most people for the least cost. All of
these can be achieved by the changes to the SAFETEA bill we outline
here.
Thank you for your time and attention. I will be happy to answer
any questions.
----------
PREPARED STATEMENT OF JIM SEAL
Former Consultant, Federal Transit Administrator
U.S. Department of Transporation
June 10, 2003
Achieving Better Outcomes--Incentive-Based Performance
There should be broad support for SAFETEA's explicit recognition
that the mission of Government should be congestion mitigation and
relief, for example,
maximizing mobility with available funds. The proposed new performance-
based incentive program, which could be greatly expanded by Congress,
is an initial first step in realizing the President's call for a more
customer-oriented and outcome-based Government.
Congress has understood the importance of maximizing mobility
(Sec. 5301) over several decades by embedding ``efficiency'' as one of
its guiding principles. In fact,
Congress found that the welfare of an urbanized society depended on an
``efficient'' and ``economical'' transportation systems in and between
urban areas [Sec. 5301 (3)]. Regrettably, local agencies do not pay
enough attention to improving efficiency.
This has resulted in decreased mobility. For example, in Santa Clara
County, 29 percent of bus service will be cut by next January in
comparison to service levels 2 years ago.
When competition is injected into the delivery of public transit as
it has in some urban areas across the country, but more extensively
throughout the world, private transportation providers have assisted
transit agencies to achieve efficient customer-oriented service as
called for by the President. All of these initiatives are consistent
with several Federal statutes designed to ensure that private
enterprise is involved ``to the maximum extent feasible'' (Sec. 5306).
Consistent with this goal, SAFETEA preserves and reinforces
existing private enterprise provisions in one important way; SAFETEA does
not discriminate against private transportation providers when ensuring
that MPOs are in compliance with Federal laws. Specifically, SAFETEA
does not preempt the Secretary from making a finding of MPO compliance
with private enterprise participation requirements during the
Secretary's certification process (Sec. 5203 Metropolitan Transportation
Planning).
Additionally, including private sector entities in Sec. 5305 as a
grant recipient in a new planning program for the development of
transportation plans and programs to plan, engineer, design, and
evaluate a public transportation project will result in the creation of
more cost-effective solutions that increase mobility and reduce air
pollution.
The new Planning Capacity Building Program in Sec. 5305, allowing
the private sector to be involved in innovative practices and
enhancements in transportation planning, has the potential to
facilitate more public/private cooperative ventures at the early
planning stage of project development.
Reinforcing these private enterprise involvement requirements in
SAFETEA and expanding private sector involvement in the planning
process as stated above are consistent with the President's recent
Federal procurement announcement expanding competition in delivering
Federal services by, in part, broadening the definition of what is
inherently the work of the private sector.
Pursuant to this new Federal policy and to fully achieve the high
performance goals of SAFETEA, local barriers to the provision of new
service by the private sector should be eliminated as a condition of
Federal funding.
Private transportation carriers provide fixed route, handicapped-
accessible and charter services nationwide in urban and rural areas and
therefore private sector participation in federally funded activities
should be greatly expanded.
To allow federally funded agencies to provide new service presently
operated by the private sector or potentially operated by private
enterprise in the future,
whether these services are subsidized or not, or whether these services
are public transit or not would be inconsistent with existing Federal
statutes, regulation, and Administration policy.
Competition vs. Monopoly--A Case for Enforcing Private Sector
Participation
California provides an excellent example of two different models of
transit delivery. In Santa Clara County (Silicon Valley), the VTA has a
monopoly of over 95
percent of fixed route transit service, while in San Diego County a
substantial portion of transit service is subjected to competition. It
should be noted that while the Silicon Valley is in the forefront of
competition in high-tech and software development, its transit system
embraces an anticompetitive model. The advantages of transit
competition were highlighted in a recent San Jose Mercury News Op-Ed
article authored by the San Jose Chamber of Commerce (included at the
end of my statement).
San Diego County in Comparison to Santa Clara County
In San Diego County over 36 percent of bus service is subjected to
competition totaling $44 million annually, and from 1979 to 2001 San
Diego's inflation adjusted costs to produce an hour of service have
decreased by 34 percent, while over the same period inflation adjusted
costs at VTA have increased 18 percent.
Other performance indicators under a competitive vs. monopoly
environment have produced the following results from 1979 to 2001:
<bullet> Bus and light rail cost per passenger mile have decreased an
inflation adjusted 32 percent in San Diego while bus and light rail
cost per passenger mile at VTA increased 13 percent;
<bullet> From 1979 when gross budget levels were roughly similar, total
inflation adjusted bus expenditures increased 36 percent at San
Diego in comparison to total inflation adjusted bus expenditures
increasing 150 percent at VTA;
<bullet> In 2001, San Diego's total bus budget was just under $100
million, while VTA's bus budget was slightly under $200 million--a
$100 million difference in favor of competition;
<bullet> In 2001, total bus boardings in San Diego were approximately
10 million higher than VTA;
<bullet> In 2001, bus operating ratio in San Diego was 42 percent in
comparison to 13 percent at VTA; and
<bullet> In 2001, light rail operating ratio in San Diego was 58
percent in comparison to 12 percent at VTA. Both systems operating
budgets are of similar size.
In 2001, San Diego's contract services cost per revenue mile
($3.76) was 42 percent of VTA's in-house cost per revenue mile ($8.89).
Labor costs as a percent of total operating budgets represent
approximately 70 percent for both entities. Even when adjusting for
differences in ``mean hourly'' wage estimates between San Diego and San
Jose (U.S. Department of Labor Bureau of Labor Statistics 2001 State
Occupational Employment and Wage Estimates--California), San Diego's
unit cost of $4.12 per revenue hour is still less than 50 percent of
VTA's unit cost per revenue mile.
There are several other successful competitive models in
California, notably Foothill Transit in the San Gabriel Valley of Los
Angeles County. From 1986 to 2001, Foothill Transit increased service
hours over 100 percent and boarding over 120 percent over what would
have been provided under in-house operation of the dominate regional
operator, LACMTA.
Internationally, center-left and center-right countries in Europe
have embraced competition much more extensively then in the United
States. For example:
<bullet> In London, 6,500 buses almost three times LACMTA and double
NYCMTA are competitively tendered;
<bullet> Five LRT systems in greater London are competitively tendered;
and
<bullet> The Stockholm, Sweden transit system comprising metro rail,
light rail, and bus and commuter rail is under a competitive
tender.
<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>
There are no consequences if a noncompetitive transit system fails
to control costs or fails to meet the highest standards of service.
Services that are competitively procured must meet numerous service
quality standards and performance failures can lead to liquidated
damages including cancellation of a contract.
Unnecessary Expansion of Special Labor Protection Provisions
Sec. 5333(b)
The Job Access and Reverse Commute (JARC), through a more
predictable funding source, and the President's New Freedom Initiative,
have the potential to provide more mobility for those that need access
to jobs and serve those that go beyond ADA service requirements.
However, these programs should not be subjected to outdated labor
protection
provisions ostensibly to protect collective bargaining rights. State
laws and the National Labor Relations Act now provide full collective
bargaining rights for employees. The original intent of ``13(c)'' in
the 1960's was to provide employees collective bargaining rights in the
absence of State laws protecting such activities. This is no longer the
case.
First, there is a great need to reform this section to correct past
abuses. Historically, the certification process under 13(c) has been
misused to favor one side in management employee relations. Local
transit managers were forced to accept certain provisions favorable to
national union interests that would not have been agreed to if critical
Federal funding had not been unacceptably delayed. These actions
violated not only NLRA, but also the private sector participation
statutes in Title 49 CHAPTER 53. Although some minor reforms have been
instituted like time constraints, there are ways to frustrate the
process. Further, the number of years of protections should be reduced
in line with labor protect reforms achieved by small railroad carriers.
Competitive Contracts Could Help Avoid Big VTA Service Cuts
By Jim Cunneen and Dave Fadness
Service cuts proposed by the Valley Transportation Authority would
unfairly punish those who desperately rely on public transit the most:
working families. VTA's budget predicament is not their fault.
Falling sales tax receipts are blamed. But VTA's costs are equally
at fault; they are spiraling out of control.
From 2001 through 2004, 29 percent of transit service will be cut,
but the cost per hour of service over the same period will increase 47
percent. Meanwhile, VTA's farebox revenue, in part due to heavily
subsidized fares, compares poorly to similar operators in other
metropolitan areas.
To solve the problem, however, decision makers are focusing too
narrowly on the revenue side, proposing new taxes and higher fares as
the first order of business. Instead, they should place first emphasis
on cutting any and all costs that do not directly produce transit
service. Why? Because VTA can control costs to a far greater degree
than it can revenue. Before going to the voters to ask for more
revenue, VTA must do everything possible to assure the community that
it has done all it can to improve efficiency and control spending.
Is there a way to stem the red ink in VTA's budget while retaining
(or improving) services, before raising fares or taxes?
Competition, may provide an important part of the answer.
Experience in the Bay Area and throughout California proves that
public/private transit partnerships work in the public's best interest,
delivering more transit service at less cost. It is time for VTA to
give it a try. Here are a few examples:
<bullet> The City of Los Angeles and 21 San Gabriel Valley cities
operate more than 475 buses under competitive contracts. The San
Gabriel cities' joint powers agency, Foothill Transit, cut
operating costs 30 percent while increasing bus service hours 100
percent;
<bullet> San Diego competitively contracts more than 36 percent of its
bus service--totaling $44 million annually. Since 1979, its
inflation-adjusted cost per hour of service has decreased 34
percent. VTA's has increased more than 18 percent; and
<bullet> In the San Francisco Bay Area, five major transit agencies
contract out all of their transit systems; SamTrans contracts out
part. Even Caltrain is a competitively contracted system.
VTA is cutting service 29 percent. If VTA reduced its per-hour bus
costs by the same percentage, its costs would still be high, but its
projected 2006 deficit of $50 million would evaporate.
How would competitive contracting work? California transit agencies
that outsource typically provide some or all of the equipment. They
require contractors to provide the labor force to pay local competitive
wages and benefits and to maintain high standards already demanded by
VTA.
Although contractors use a smaller workforce to perform the same
amount of service, they usually use organized labor and are subject to
damage payments for poor or missed service.
In most cases, the public agency also bids for the service
contracts, encouraging cost efficiencies and improved service by both
public and private sectors.
VTA's goal should be to minimize proposed service cuts and job
losses. We suggest that it start now, boldly taking advantage of this
opportunity to competitively contract high-subsidy bus routes,
requiring contractors to give preference in hiring to VTA employees. We
believe the resulting savings would protect jobs and diminish service
cuts.
Competitive contracting should also be considered for the
management of VTA. The 1984 Measure A Traffic Authority is a local
example of how effective this approach can be: a $1.2 billion multiyear
project was successfully managed by only five people. Huge savings
could result from improvements in management efficiency, effectively
making more of existing revenue available to serve transit riders.
That should be VTA's goal. We can avoid dramatic tax increases and
fare increases by embracing new approaches. Other California transit
operators are doing it with great success, relying on the same powerful
model that makes our economy the world's strongest: competition.
Jim Cunneen is president and CEO of the San Jose Silicon Valley
Chamber of Commerce and a member of the VTA's Ad-Hoc Financial
Stability Committee; Dave Fadness is the former vice chair of the
Measure B Citizen's Watchdog Committee.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR REED
FROM NORMAN Y. MINETA
Security and Terrorism
Q.1. If the Department of Homeland Security is the appropriate
agency to address this issue, do you think the fiscal year 2004
budget request provides sufficient funding to address the
significant threats facing our transit systems?
A.1. The Transportation Security Administration in the
Department of Homeland Security (DHS) has primary
responsibility for transportation security. The Department of
Transportation plays a supporting role to assist DHS in meeting
its mandates. Since September 11, the Federal Transit
Administration (FTA) has continued to provide technical
assistance, training, and research. Just as it has done with
safety and crime prevention, FTA's homeland security activities
work to integrate security into all aspects of transit
operations, from planning, design, and construction to
operations and maintenance. FTA activities are coordinated with
TSA, to ensure that they augment and compliment DHS strategies
as this new agency comes fully online. Through close
cooperation and coordination of DOT and DHS programs and
activities, we are working to ensure that resource allocation
reflects the risks and the requirements of each mode of
transportation.
Q.2. What was the Department of Transportation's rationale for
not signing the expected memorandum of understanding on transit
security with the Department of Homeland Security?
A.2. The Department of Homeland Security's (DHS) Transportation
Security Administration (TSA) has primary responsibility for
transportation security policy. The Department of
Transportation (DOT) plays a supporting role, assisting DHS
with implementation of its security policies. As DHS forms
Federal transportation security policy, both TSA and DOT have
committed to broad and routine consultations through numerous
formal and informal mechanisms operating at all levels within
the two organizations. These consultative mechanisms are
working, and both departments will continuously evaluate how to
promote effective cooperation.
The principles of this cooperation are laid out in several
interagency memoranda of understanding signed by TSA and DOT,
and most importantly, by the exchange of letters between
Secretary Mineta and TSA Administrator Jim Loy in February
2003. At Secretary Mineta's request, Deputy Secretary Michael
Jackson has served since March 1 as DOT's liaison to
Administrator Loy for the coordination of all nonroutine policy
issues, intelligence analysis, public and transportation
industry communication, and operational planning. In addition,
Secretary Mineta has designated the Office of Intelligence and
Security as the official point of contact between DOT and TSA.
At this time, DOT does not see an immediate need for additional
legal mechanisms to coordinate responsibilities between the two
agencies. As TSA works to strengthen its capabilities beyond
aviation, and after consultation with Administrator Loy, DOT
has continued for now a few of our preexisting programmatic
efforts. For example, we continue to work with transit
operators and State transportation executives to inform and
educate them regarding security awareness and best practices to
enhance security. These efforts are not policymaking
activities. Instead, they are intended during the transition to
augment and complement TSA's work, as the new agency continues
to grow its staff, programs, and experience in working with
diverse transportation sectors. In the months ahead, DOT's role
in such security educational efforts will likely decrease.
``One DoT'' Policy
Q.3. Mr. Secretary, you have often espoused a ``One DoT''
policy to describe your view that DoT is truly intermodal and
does not favor one mode over another. Could you reconcile this
``One DoT'' policy with the decision to flat line the FTA's
budget, end the guarantee of the transit's General Fund
resources, and increase the State match required for new
transit systems?
A.3. Our reauthorization proposal does not favor one mode of
transportation over another mode. In fact, under the Safe,
Accountable, Flexible, and Efficient Transportation Equity Act
of 2003 (SAFETEA), transit funding would increase to $46
billion over the 6-year authorization period--a 28 percent
increase over the $36 billion authorized in TEA-21. Highway
funding under SAFETEA grows 18 percent compared to its funding
under TEA-21. So we do not believe we shortchanged transit at
the expense of highways.
Our SAFETEA proposal continues the policy established in
TEA-21 to ``firewall'' or ``guarantee'' spending from the Mass
Transit Account of the Highway Trust Fund, just as funds for
highways from the Trust Fund are guaranteed. Approximately, 80
percent of FTA's funding comes from the Mass Transit Account.
In fact, transit has been the only Federal program to enjoy
``guaranteed'' General Funds.
With regard to the proposed maximum Federal New Starts
share of 50 percent, there is no evidence to suggest that a 50-
50 share requirement will deter transit project development. In
fact, the overall Federal New Starts share today is 49 percent,
so we are, to a certain extent, simply codifying existing
practice. Furthermore, an additional 30 percent of project
costs can be funded with other Federal funds, such as from the
Congestion Mitigation Air Quality program or the Surface
Transportation program. States and communities already take
advantage of this flexibility as seen by the more than $9
billion transferred from these two highways programs to support
transit projects. In fact, we believe that imposing a 50
percent Federal New Starts share maximum will help level the
playing field among communities seeking New Starts funding.
Combined with other SAFETEA changes, such as making nonfixed
guideway projects eligible for New Starts funds, this proposal
will give more communities the opportunity to pursue major
capital transit projects.
Elderly and Disabled Riders
Q.4. The Administration has proposed a ``New Freedom
Initiative'' for disabled riders. What is the rationale for
this new program and why wouldn't it be more appropriate to
simply increase funding for the existing and successful Elderly
and Disabled transit program?
A.4. The Department of Transportation's program is part of the
President's broader New Freedom Initiative (NFI), which is
intended to help Americans with disabilities by increasing
access to assistive technologies, expanding educational
opportunities, increasing the ability of Americans with
disabilities to integrate into the workforce, and promoting
increased access into daily community life.
The NFI is also building on the Supreme Court's 1999
Olmstead decision in order to promote maximum independence and
facilitates integrating individuals with disabilities into
community life. Transportation can be a particularly difficult
barrier to work and other community activities for Americans
with disabilities. The lack of adequate transportation remains
a primary barrier for people with disabilities, as evidenced by
the fact that one-third of people with disabilities report that
inadequate transportation is a significant problem.
The New Freedom program for transportation addresses these
significant remaining transportation barriers not addressed by
the Americans with Disabilities Act (ADA). The ADA addresses
the accessibility of existing transportation services and
facilities. It does not address the service gaps that continue
to exist for persons with disabilities who experience a seventy
percent unemployment rate.
The New Freedom funding is directed at providing additional
transportation services that can provide persons with
disabilities new transportation connections to jobs and
essential community services and activities needed to foster
independence and integration into the community.
The existing Section 5310 Elderly and Disability Program
provides funding to assist primarily nonprofit entities in
acquiring
vehicles to provide special transportation services. This
transportation is frequently associated with the delivery of a
particular human service program for the elderly or individuals
with disabilities. Section 5310 funding is often used for
replacement vehicles to continue existing special human service
transportation services. The proposed New Freedom program moves
beyond existing specialty human service programs to address a
broader range of transportation service gaps that exist for
persons with disabilities. Therefore, under the NFI, services
may be provided by public transportation, private
transportation, and/or nonprofit organizations. The program
funds will be used for activities identified in a local
coordinated plan developed by stakeholders in the local
community served.
The program will provide operating, as well as capital,
funding to achieve these purposes. For example, the New Freedom
funding could be used by a community to deliver additional
paratransit services to persons with disabilities living beyond
the three quarter mile limit covered by the ADA complementary
services, or to provide funding to help purchase accessible
taxicab vehicles, so that persons with disabilities can more
easily avail themselves of this travel option. In many
communities, accessible taxis provide a quick-response, real-
time service to places and during times not served by existing
transit and special human service transportation operators.
Q.5. In discussing SAFETEA with advocates for the disabled,
they have voiced concerns with the New Freedom Initiative.
While the disabled community supports resources that would
allow the development of innovative transportation services for
people with
disabilities, these advocates are concerned because the
Administration's reauthorization proposal is woefully
underfunded, and there is no additional money to pay for this
new initiative. It also appears that the proposal would allow a
State to transfer funds from this initiative to other
transportation programs. Given the fiscal crises most States
face, the lack of adequate funding in the Administration's
proposal, and the chance a State could transfer ``New Freedom''
dollars to other transportation programs, where is the
assurance that funds will actually be used to provide
transportation services to people with disabilities?
A.5. While the SAFETEA proposal includes the ability to
transfer funds for the purpose of reducing the administrative
burden on grantees, it also ensures that, if funds are
transferred to other programs, the funds must continue to be
used for the originally identified purpose. Therefore, if New
Freedom funds are transferred, for example, to the FTA Section
5311 nonurbanized area program, these transferred funds must be
used to support New Freedom transportation purposes. The
transfer of these funds to other FTA programs affords grantees
the opportunity to file a consolidated application, rather than
multiple applications for New Freedom, JARC, Section 5310
funding. In addition, SAFETEA provides for further assurance
that the transportation needs of persons with disabilities are
met by requiring communities to address the needs of persons
with disabilities, in addition to the elderly and low-income
individuals, through a locally developed, coordinated public
transit-human services transportation plan.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SARBANES FROM NORMAN
Y. MINETA
Q.1. I understand that the Administration is proposing an
incentive tier in the formula programs, to be awarded to
transit agencies that increase ridership. Why does the
Administration believe such an incentive is necessary for large
urbanized areas, given that the formula for these areas already
includes passenger miles traveled as a factor in its
distribution of funds, rewarding areas with higher ridership?
Also, there are some transit agencies which already carry a
large percentage of local residents and have limited ability to
increase ridership without significant additional funding to
increase their carrying capacity. How does the Administration
respond to their concerns that they will, in effect, be
precluded from participating in this incentive program?
A.1. The performance incentive funds in the urbanized area
formula program (Section 5307) would be apportioned using an
administrative formula based on the percentage increase in
ridership and accounting for the size of the community. The
formula may also take into consideration efficiency of service
in the urbanized area. In order to qualify for the incentive,
transit systems would have to ensure that levels of ridership
among elderly individuals, individuals with disabilities, or
low-income persons are not negatively affected. Because not all
systems currently collect data on ridership among these
specific populations, a portion of the incentive funds will be
made available for enhanced data collection in the initial
years of the authorization period.
Performance incentive funds will also be available to
nonurbanized areas. Since nonurbanized or rural transit systems
tend to focus their services largely on ``transit dependent''
populations (the elderly, individuals with disabilities, and
low-income persons), the incentive funds for rural areas will
be distributed based on increases in overall ridership. The
incentive formula may also take into consideration efficiency
of service in rural areas. The entire amount available for
incentives in fiscal year 2004, and a portion of the funds
available during the subsequent 2 years, will be made available
to the States to establish data collection systems, since
States are not currently required to report ridership data for
nonurbanized areas to FTA's National Transit Database.
FTA plans to consult broadly and seek public comment on
options and plans to implement the performance incentive
program, so that concerns about such issues as capacity can be
appropriately considered.
Q.2. Mr. Secretary, in your testimony you state that 40 percent
of counties in this country have no public transportation. On
what do you base that figure?
A.2. In the mid-1990's, the Community Transportation
Association of America (CTAA) compiled an inventory of rural
transit systems funded by the Federal Transit Administration.
This study found that approximately 40 percent of the
nonmetropolitan counties in the United States had no public
transit system. This figure has been widely used as an
indicator of the unmet need for rural transit services. A
subsequent update of the inventory, published in 2000, did not
provide comprehensive county data, but did indicate that the
significant increases reported in rural transit ridership and
vehicle revenue miles were primarily a result of improved
levels of service offered by existing transit providers, rather
than an expansion of the network of providers.
Q.3. Mr. Secretary, in your testimony you state that SAFETEA,
``projects requesting less than $75 million (would) be subject
to a simplified New Starts process. We would utilize the same
evaluation criteria established by Congress for projects
seeking more than $75 million in funding from New Starts, but
reduce the number of New Starts hurdles and simplify the
evaluation process for these projects.'' How do you plan to
simplify the evaluation process? What hurdles are you referring
to, and how would you reduce their number?
A.3. FTA has not fully defined its development and evaluation
process for projects seeking less than $75 million in New
Starts funds, and will not do so without close consultation
with the transit community. However, we believe that there are
a number of areas with potential for simplification. For
example, FTA will explore ways to speed its project approval
process for these projects. Currently, proposed New Starts
investments must be approved by FTA to enter into the
preliminary engineering and approved again in order to enter
into the final design phase of project development. Projects
requesting less than $75 million in New Starts funds could be
subject to a single approval and/or reduced requirements. In
developing any simplified evaluation process, FTA will take a
common sense approach to speed project delivery, while ensuring
continued stewardship of Federal tax dollars.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR DOLE
FROM NORMAN Y. MINETA
Q.1. Mr. Secretary, I am concerned that applications for Full
Funding Grant Agreements (FFGAs) under the New Starts process
originating from the same State may be subjected to a prejudice
in awarding multiple FFGAs within the same State and same
fiscal year that would delay the progress of these projects.
Can you please confirm this is not the case?
A.1. The number of Full Funding Grant Agreements (FFGAs) in a
State is not a factor in evaluating proposed New Start projects
for new FFGAs. In 2001, FTA awarded four FFGAs in a single year
to grantees in Illinois: One to the Chicago Transit Authority
for its Douglas Branch reconstruction, and three to the
commuter rail
operator in suburban Chicago (the Regional Transportation
Authority, Metra) for construction of its extensions in the
North Central, Southwest, and Union Pacific West corridors.
In 2000, FTA awarded two FFGAs to the New Jersey Transit
Corporation: One for the second minimum operating segment of
the Hudson-Bergen light rail, the other for the first minimum
operating segment of the Newark-Elizabeth light rail. In 1997,
FTA awarded three FFGAs to grantees in California: One to the Los
Angeles County Metropolitan Transportation Authority for the North
Hollywood branch of the Metro Rail Red Line, one to the Bay Area
Rapid Transit District for its rapid rail extension to San Francisco
International Airport, and one to the Sacramento Regional
Transit District for its light rail extension in the South
corridor.
Q.2. Mr. Secretary, I am also concerned that the Federal
Railroad Administration (FRA) is attempting to assert
jurisdiction over rail transit systems that share a corridor,
but not tracks, with operating freight railroads. I do not
believe that this has ever been done before for any other mass
transit project and would greatly add costs to the operation of
a transit project. Can you describe the Department of
Transportation policy as to this question of what projects
would and would not be subject to FRA jurisdiction?
A.2. Under the Federal railroad safety statutes, as amended in
1988, FRA's safety jurisdiction extends to rapid transit
operations that are connected to the general railroad system.
Those laws define ``railroad'' very broadly to include ``any
form of nonhighway ground transportation that runs on rails or
electromagnetic guideways.'' 49 U.S.C. 20102. Specifically
included within the definition are high-speed rail systems that
connect metropolitan areas and ``commuter or other short-haul
railroad passenger service in a metropolitan or suburban area.'' The
only railroads excepted from FRA's jurisdiction are ``rapid transit
operations in an urban area that are not connected to the general
railroad system of transportation.'' Congress was referring here to
subways and street railways.
In recent years, many communities around the Nation have
begun to use, or consider using, conventional railroad tracks
or corridors to provide commuter or rapid transit service using
light rail vehicles. FRA and the Federal Transit Administration
(FTA) issued a joint policy statement in July 2000, explaining
how they would apply their respective safety jurisdictions in
these situations. 65 Fed. Reg. 42526. FTA has residual safety
jurisdiction, which it
implements through its State safety oversight program, over
rail fixed guideway mass transportation operations that are
``not subject to regulation by the Federal Railroad
Administration.'' 49 U.S.C. 5330.
On the day the joint FRA/FTA policy statement was issued,
FRA issued its own statement of agency policy on the shared use
of the general system by light rail and conventional rail
operations. 65 Fed. Reg. 42529. In that statement, FRA stated
its interpretation and policy with regard to rapid transit
connections to the general system sufficient to warrant
exercise of its jurisdiction. FRA made clear that rapid transit
operations that share track with conventional operations are
fully subject to FRA's safety regulations, but explained that
waivers of many rules would be likely if the transit operations
are conducted at separate times of day from the conventional
operations. This ``temporal separation'' addresses the enormous
risk inherent in shared use, for example, that a light rail
vehicle and conventional vehicle could collide. The transit
vehicles are simply not designed to withstand such a collision
with the much more heavily constructed conventional rail
vehicles, and such a collision would likely be catastrophic.
FRA's willingness to grant necessary waivers of rules not
designed for application to rapid transit will help ensure that
the rapid transit systems face no unnecessary costs.
With regard to rapid transit operations that do not share
track with conventional railroads but do have other connections
to the general system, FRA noted that three types of
connections posed sufficient safety hazards to warrant FRA's
exercise of jurisdiction over the transit line to the extent it
is connected: Railroad crossings at grade, joint control of
trains in the same corridor (for example, a shared movable
bridge), and highway-rail grade crossings in a shared corridor.
All of these types of connections pose significant dangers and
call for uniform regulation of the connected operations. For
example, FRA noted that the safety of highway users can best be
protected if they receive the same signals warning of the
presence of a rail vehicle at a crossing regardless of the type
of rail vehicle. We believe the safety of employees and the
public depends on a consistent regulatory approach with regard
to operations at these points of connection. Please note that
FRA does not regulate the entire rapid transit system that has
such limited connections; FRA regulates the rapid transit
system only as necessary to ensure safety at the points of
connection. This very limited regulation will have minimal
costs, which could possibly be further reduced where a waiver
is appropriate.
Under the railroad safety statute, of course, a commuter
railroad is fully subject to FRA's jurisdiction regardless of
its connections to other railroads. However, Congress did not
define ``rapid transit operations in an urban area'' or
``commuter or other short-haul railroad passenger service in a
metropolitan or suburban area,'' the terms used in the statute.
Therefore, FRA has attempted to provide guidance on how it will
make the distinction between these types of operations in its
July 2000 policy statement. FRA looks at factors such as a
system's primary purpose, the area that it serves, the
equipment that it uses, and the frequency of its service.
Railroads that have doubts about their proper categorization
can seek FRA's opinion, as the Triangle Transit Authority (TTA)
in North Carolina's Research Triangle area recently did
concerning the regional railroad planned for that area. FRA
provided TTA a legal opinion in January 2003, concluding that
the regional system will be a commuter railroad or other short-
haul railroad passenger service, but will not be rapid transit.
TTA has challenged that decision in the U.S. Court of Appeals
for the Fourth Circuit, where the case is being briefed.
Q.3. Mr. Secretary, several communities around the Nation will
be ready to sign FFGAs and proceed to construction this
calendar year. In the event that reauthorization of the surface
transportation law is delayed, will it be possible for
applicants in the pipeline who are recommended and/or highly
recommended to receive a contingent commitment from the
Department of Transportation to enable them to proceed under an
extension of TEA-21?
A.3. The effects of a delay in the reauthorization of the
Nation's Surface Transportation Act would depend upon the exact
nature of any Congressional action taken to extend TEA-21. In
the absence of specific legislative language, the effect of
such an extension on applicants in the New Starts pipeline
would be pure speculation.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY FROM WILLIAM
MILLAR
Q.1. Your testimony indicates your support for continuing the
funding guarantees which were included in TEA-21, covering both
Trust Fund and General Fund resources. Can you suggest any way
in which the program could be made more predictable while still
giving Congress a way to adjust program levels in the future
should circumstances require it?
A.1. APTA strongly urges Congress to maintain the funding
guarantees provided under TEA-21 when it develops the new
authorizing law for Federal transit and highway programs.
Funding guarantees included in TEA-21 made Federal funding for
transit in the annual appropriations far more predictable over
the last 6 years than had ever been the case in the past.
Predictable funding for transit over the life of the 6-year
authorizing law helped to facilitate the long-term capital planning
and budgeting that is needed for transit agencies to make the most
efficient use of limited
resources. Since the Federal transit program became primarily a
capital program under TEA-21, and because transit capital
programs are multiyear in nature and depend on State and local
funding matches, agencies can do a better job maintaining and
replacing their capital plant, at less cost, if they know how
much Federal support to expect from year to year. Guaranteed
funding also ensures that the Federal Government invests in
both our transit and highway infrastructure. In the years prior
to the guarantees in TEA-21, Congress actually funded highway
programs far closer to the funding levels set in authorization
bills than it did with transit programs.
According to a December 2002 study by Jeffrey A. Parker
entitled The Benefits of TEA-21 Funding Guarantees, the
guarantees have ``stretched scarce Federal dollars for public
transit further and produced additional spin-off benefits by
accelerating construction and leveraging new sources of State
and local matching funds.'' Regarding funding predictability
for new rail starts, the report goes on to note that the
``flexibility to borrow against Full Funding Grant Agreements
has allowed the total number of projects participating in the
Section 5309 New Starts Program to increase in recent years.''
In short, APTA urges Congress to maintain the funding
guarantees for both the Trust Fund and General Fund portion of
the Federal transit program when it develops new authorizing
law. We note, however, that TEA-21 provided Congress with
funding flexibility by authorizing additional General Fund
resources in excess of Trust Fund and General Fund guaranteed
funding, and that Congress used this resource to adjust the
program above the guaranteed program level in fiscal year 1999.
Q.2. Your testimony opposes elimination of the bus
discretionary program. The Administration claims that providing
these funds would make the prograin more predictable, enhancing
local planning. You have said that predictability is important
in supporting continuing the funding guarantees, so why isn't
it just as important in bus funding? What examples can you
provide about the kinds of discretionary funding makes more
sense.
A.2. While APTA supports predictable Federal funding that helps
transit agencies plan multiyear budgets, it did recommend that
the Discretionary Bus and Bus Facilities Program be preserved
as a separate discretionary program and not folded into the for-
mula program and the New Starts Program as proposed by the
Administration.
We made these recommendations for a number of reasons.
First, the existing program structure has worked very well,
even though funding for each of the individual transit programs
falls short of addressing identified needs. Although current
funding does not adequately address the demand for replacement
of vehicles and bus facilities, APTA believes that increased
funding for the existing Discretionary Bus and Bus Facilities
Program, and the creation of a new program to replace overage
vehicles, is a better way to address these needs.
Moving half of the existing bus program funding into the
formula program as proposed by the Administration would simply
spread too little resources across too many agencies to
effectively address the existing need for vehicles and
facilities. Vehicle and facility replacement or purchases at
transit agencies tends to come in cycles, and not on a regular,
year-to-year basis. APTA believes that these needs are best met
with discretionary funding available at the time when equipment
should be replaced or purchased. Whether an agency is building
a bus garage, replacing a portion of its bus fleet, or building
a new rail system, these purchases are essentially long-term,
one-time major capital investments which have been funded for
more than 20 years under discretionary programs.
Q.3. Your organization supports continuing the present
requirement that New Starts projects must have a ``fixed
guideway'' component while the Administration proposes relaxing this
requirement to increase the flexibility of the program to
address certain Bus Rapid Transit projects. Don't the present
limit[ations] on eligiblity have the potential to bias local
decisions toward projects which are eligible for funding, even
when a nonfixed guideway project might be the better choice in
a community? How can projects like this proceed if they need
funding from [for] more than 1 year, and the only way to get a
multiyear commitment is from the New Starts Program? Is it
really practical to assume that these projects could be funded
from the Bus program, which typically supports a very large
number of projects with an average of only about $1 million per
year per project?
A.3. APTA would like to emphasize that Bus Rapid Transit (BRT)
systems which have exclusive rights of way or other fixed
guideway designs are currently eligible for funding under the
New Starts Program. Indeed, APTA's TEA-21 reauthorization
recommendations call for statutory language making clear that
such projects are eligible for New Start funding.
APTA believes that agencies that want to develop bus
service without any fixed guideway characteristics should
continue to be able to do so using a combination of formula
funds and discretionary bus funds. We note that current demand
for Federal funds to build fixed guideway New Starts and
extensions, including BRT projects, far exceeds available
resources, and we are concerned that funding nonfixed guideway
BRT systems from New Starts resources would only exacerbate the
existing shortfall. We would add that many communities seeking
funds for fixed guideway systems are already exceeding the
required State and local match, and observe that if communities
wanting nonfixed guideway BRT systems provided similar local
matching funds it would be possible to fund even more such
systems.
While the average grant award under the Discretionary Bus
Program may be only about $1 million per year, we note that
there were a substantial number of projects funded in fiscal
year 2003 in excess of that amount. In fact, one of the fiscal
year 2003 bus grants provided almost $8 million for BRT-related
costs in Hawaii, which was in addition to almost $7 million for
other bus projects in Hawaii. While there is currently no
commitment process for multiyear bus projects, multiyear
funding in the appropriations process can presumably be
provided if a project is widely supported by a State's
congressional delegation.
Q.4. The Administration proposes to combine Fixed Guideway
Modernization Funding with urbanized area formula funds into a
single allocation to each urbanized area which can then be used
flexibly for any transit purpose. The funding formulas would
stay the same. Your testimony opposes this idea. Why does APTA
believe it is such a bad idea to provide local areas [with the
ability] to decide how to allocate these funds? If the funding
levels are the same, why would you recommend not providing this
flexibility?
A.4. APTA generally supports flexibility in the use of Federal
transit funds, but we believe it would be a mistake to fold the
Fixed Guideway Modernization Program into the urban formula
program and permit the use of such funds for any transit
purpose. As stated in our written testimony, the program ``was
designed to ensure the proper modernization of the Nation's
older rail systems, and it helps ensure that as Federal New
Start investment projects age they can be modernized.'' Our
testimony also expresses APTA's concern that diverting these
funds from Fixed Guideway Modernization, where needs far exceed
available resources, would only exacerbate unmet modernization
needs and potentially result in the deterioration of some of
the Nation's most valuable capital assets.
The bottom line for APTA is that modernization needs
cannot, and should not, be deferred. We believe that the
current system, which provides Fixed Guideway Modernization
Funds directly to operators of fixed guideway systems, for only
fixed guideway modernization purposes, makes sense. Since other
urban formula funds go to a designated recipient in a community
that may have multiple transit operations in need of capital
funds for a variety of purposes, it would be quite likely that
Fixed Guideway Modernization Funds might be directed to other
purposes. While APTA supports giving localities flexibility in
how they use transportation funds,
it was the consensus of all of our member organizations to seek
the preservation of the existing Fixed Guideway Modernization
Program based on the large and growing need for modernization
of these facilities.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR REED
FROM WILLIAM MILLAR
APTA's Reauthorization Proposal
Q.1. Mr. Millar, could you explain in greater detail APTA's
proposals to address the needs of smaller urban communities?
A.1. APTA's reauthorization proposal includes a number of
recommendations that address the needs of smaller urban areas.
Among the recommendations that directly or indirectly benefit
smaller urban areas are the following:
Increased Formula Funding for Small Urban Areas
APTA's proposal calls for an 87 percent increase in formula
funding for small urbanized areas. It would increase funding
for the program from $334 million in fiscal year 2003 to $626
million in fiscal year 2009.
High Intensity Small Urbanized Area Formula Program
APTA's proposal recommends the creation of a new ``High
Intensity Small Urbanized Area Formula Program'' that would
provide formula funding--in addition to funding under the
current small urban formula program--that would be distributed
among those small urban areas that provide service above the
average level of service in larger urban areas. The proposed
program would be funded at $35 million in fiscal year 2004 and
grow to almost $54 million in 2009.
This is intended to provide formula funding under the small
urban program which reflects higher levels of service provided
by transit agencies in separate communities with similar
population and density. Under the current small urban formula
program, funding is provided strictly on the basis of
population and population density. Unlike the large urban
formula program, which includes a service level factor,
agencies in small urban areas that provide higher levels of
service get the same amount as agencies which provide less
service in small urban areas with similar population and
density factors. Under this APTA proposal, agencies in similar
size communities that run more buses, carry more passengers, or
provide more frequent service would receive more Federal
formula funding than those in comparable size communities that
provide less service. The proposal is modeled on the
recommendations from a Federal Transit Administration (FTA)
study of transit formula funding mandated under Section 3033 of
the Transportation Equity Act for the 21st Century (TEA-21).
Aging Bus Replacement Program
APTA's proposal recommends the creation of a new Aging Bus
Replacement program for urban areas of less than one million
people and in rural areas. Under the program grants would be
provided to replace vehicles--buses and vans--that exceed 150
percent of the FTA recommended age for replacement. The
proposed program would be funded at $100 million in fiscal year
2004 and grow to almost $156 million in fiscal year 2009.
This program would benefit rural areas and medium-size
urban areas, as well as small urban areas. It is intended to
focus on the need to replace overage vehicles--one of the most
basic capital needs for public transportation service--in
communities that have been unable to obtain sufficient funding
for vehicle replacement under the Discretionary Bus and Bus
Facilities Program or existing formula programs. It is meant to
help modernize the fleet of public transportation vehicles in
every community, reduce maintenance costs associated with
operating overage vehicles, and attract riders with the newer
vehicles.
Transitional Authorily for UZA's Going over 200,000 Population
APTA's proposal would permit urbanized areas that grow from
less than 200,000 people to more than 200,000 or which were
added to urbanized areas of more than 200,000 people as a
result of the 2000 Census, to annually use an amount of Federal
transit formula funds equal to the amount they were allowed to
use for operating purposes in fiscal year 2002 for operating
purposes through fiscal year 2009.
Current law permits transit providers in urbanized areas of
less than 200,000 people to use Federal formula funds for
either capital or operating purposes. Many transit agencies in
this category use a significant portion of Federal funds for
operating purposes. This change would provide transit agencies
that transition from ``less than'' 200,000 population to ``more
than'' 200,000 with the flexibility to use Federal formula
funds for operating or capital purposes as needed.
Other Benefits
In addition to the proposals cited above, APTA's
recommendations would provide increased flexibility under drug
and alcohol testing programs and charter bus regulations, both
of which directly benefit transit operators in small urban
areas. APTA's proposal also calls for improved coordination or
combining of Federal reviews and audits to avoid duplication,
and the establishment of Federal requirements that agencies
administering TANF and the Job Access and Reverse Commute
(JARC) programs coordinate with local transit agencies in the
provision of transportation services. Finally, APTA's proposal
would allow transit grant recipients to procure vehicles and
other products from the GSA Schedule, which would help small
transit agencies which have limited ability to negotiate, to
save money in the purchase of vehicles and other capital items.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SARBANES FROM WILLIAM
MILLAR
Q.1. Administrator Dorn testified last year before this
Committee that, ``The guaranteed funding commitment, in terms
of the Administration's point of view, has been one of the key
successes of ISTEA and TEA-21. Most importantly, in our view,
it has leveraged State and local investments in transit and in
transportation generally.'' Do you agree with that statement?
What do you believe would be the practical effect on your
members if TEA-21's guarantees around the entire transit
program were not continued in the next bill?
A.1. I agree very strongly with Administrator Dorn's statement
that guaranteed funding for public transportation has been one
of the key successes of TEA-21. In fact, maintaining the
funding guarantees in the reauthorization of TEA-21 is one of
APTA's three key recommendations for the reauthorization of
TEA-21. As Administrator Dorn correctly points out, the funding
guarantees created in TEA-21 enable transit systems to leverage
Federal investments and lower project costs, develop public/
private partnerships, implement long-range plans, and operate
in a business-like fashion. It is critical that the funding
guarantees be retained in the reauthorization effort.
I should note, however, that ISTEA did not include funding
guarantees for public transportation. Between fiscal year 1992
and fiscal year 1997 under ISTEA appropriated funding for the
Federal transit program equalled only 77 percent of authorized
funding and varied year to year. This level of transit funding
under ISTEA and lack of predictable funding under ISTEA only
confirms the importance of the TEA-21 guarantees. Furthermore,
appropriated funding under ISTEA probably would have been less
than 77 percent of authorized levels if not for the fact that
the 1992 authorization was concluded after the fiscal year 1992
appropriations bill was completed. The fiscal year 1992
authorization level was therefore written to conform with the
previously enacted appropriations level.
We believe that the guaranteed funding provided by TEA-21
has stretched scarce Federal dollars for public transportation
further and produced additional benefits by accelerating
construction and leveraging new sources of State and local
matching funds. For example, Congress is now able to spread its
commitments to New Start fixed guideway projects over a longer
time frame than the construction period. The flexibility to
borrow against Full Funding Grant Agreements has allowed the
total number of projects participating in Section 5309 New
Starts Program to increase in recent years. In that regard, we
are pleased to have shared with the Committee and its staff a
recent report that demonstrates just how important the
guarantees are, ``The Benefits of TEA-21 Funding Guarantees''
by Jeffrey A. Parker.
Higher levels of guaranteed Federal support under TEA-21
are attracting even higher levels of stable, reliable
nonfederal matching funds. During the 1990's Federal outlays
for transit capital investment grew at an average of 5.0
percent per year, while local expenditures climbed at an
average annual rate of 11.7 percent.
We believe that the practical effect on our transit members
if guaranteed funding were not continued in the next bill is
that the long-term viability of the transit program would be
threatened. Our members and private financial institutions have
come to rely on the stable and predictable funding provided
under the guarantees. In the absence of the guarantees, the
private financial markets would be unlikely to make longer-term
commitments when faced with the uncertainty of the annual
appropriation process. The ability to leverage funds and to
make long-term commitments would be seriously impaired. It is
for this reason that I strongly urge the Committee to keep
guaranteed funding as part of the reauthorization of TEA-21
legislation.
Q.2. The Administration has proposed to merge the Fixed
Guideway Modernization Program into the Urbanized Area Formula
Program, and to allow those funds to be used for any purpose
eligible under the formula program, not just for fixed guideway
modernization. Given your experience in the transit industry, I
would like to understand, first, why the Fixed Guideway Program
was created, and second, whether you believe that its original
purpose has been fulfilled. In your view, would the
Administration's proposal further the purpose for which this
program was created?
A.2. The Fixed Guideway Modernization Program was originally
created to help modernize aging fixed guideway systems that
were built without Federal assistance prior to the
establishment of a Federal transit program. Over the years, it
has developed into a program to assist with modernization needs
of fixed guideway systems, built with or without Federal
assistance, that require upgrading and rehabilitation of aging
infrastructure, as well as other technology improvements that
permit the movement of an increasing number of passengers
through existing systems. In addition to installing equipment
that did not exist when these systems were built or previously
modernized, the program helps address mandates and needs not
envisioned when these systems were built, including state of
the art security equipment and accommodations for people with
disabilities.
In short, modernization, whether it is based on new
addressing new technology, safety, security, efficiency, and
increased passenger capacity, or basic infrastructure
upgrading, is a necessary and ongoing part of running these
systems.
APTA questions the Administration proposal to distribute
Fixed Guideway Modernization Funds under the urban formula
program and to permit the use of Fixed Guideway Modernization
Funds for nonfixed guideway modernization purposes. As noted,
the Fixed Guideway Modernization Program was designed to ensure
the proper maintenance of the Nation's older rail transit and
fixed guideway systems, and it helps ensure that as Federal New
Start investment projects age they can be modernized. Rail
systems in large metropolitan areas carry millions of
passengers each year and their ridership has grown
substantially in recent years. Many of these systems are
approaching capacity constraints. These funds also help systems
address this growth in ridership and ensure that passengers can
use these systems safely and efficiently. The Administration
proposal would allow these funds to go to an urbanized area and
be used for any transit purposes, not just modernization. We
are concerned that diverting these funds from Fixed Guideway
Modernization, where needs far exceed available resources,
would only exacerbate unmet modernization needs and potentially
result in the deterioration of some of the Nation's most
valuable capital assets. Again, the Fixed Guideway
Modernization Program has been a critical component of the
Federal transit program structure since 1982, and it is a great
success.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY FROM JEFF
MORALES
Q.1. I understand that AASHTO continues to support the funding
guarantees in TEA-21. How would you reconcile the goals of
providing predictability for transit agencies while not tying
the hands of future Congresses to deal with current fiscal
situations? Can you suggest any way in which the program could
be made more predictable while still giving Congress a way to
adjust program levels in the future should circumstances
require it?
A.1. I believe that the tools for that adjustment already exist
in the current appropriations process and through obligation
authority limitations. California is supportive of extending
RABA provisions to the Mass Transit Account provided that
Congress can create a mechanism that can dampen the impact of
financial downturns.
Q.2. What are AASHTO's views with respect to use of various
Federal bonding proposals to finance the transit program? Do
you support continued allocation of 2.86 cents to the Mass
Transit Account as a base from which any program increases
should be taken?
A.2. AASHTO supports maintainig the existing balanced approach
to addressing highway and transit needs. It has adopted
principles for reauthorization that recognize that the current
funding structure under TEA-21, in which Highway Trust Fund
revenues are split with 80 percent credited to the Highway
Account and 20 percent credited to the Mass Transit Account is
working well and should be retained. The Federal transit
program needs a stable source of guaranteed funds from the Mass
Transit Account of the Highway Trust Fund and the General Fund
in order for decision makers to commit to expensive transit
solutions. The current arrangement under TEA-21 provides a
stable, more predictable environment for planning, programming,
and constructing these key transit projects.
Q.3. As we have heard, 40 percent of rural counties have no
public transportation at all and many with transit have very,
very limited service. Do you support the Administration's
proposal to increase rural funding? What has been the States
experience managing this
program?
A.3. Certainly more funds are needed for rural transportation
systems. Rural operators tend to keep vehicles in service
significantly beyond Federal useful life standards because of
fund needs. As you point out, there is a large proportion of
rural America that does not have the benefit of transit
service. However, over 80 percent of our population lives in
urban areas and many urban transit systems face similar
challenges. It is clear that the only way that we can address
this diversity of needs is to make sure that there are
sufficient resources available. The goal is not to increase the
size of one program at the expense of others, which is a zero
sum game, but to increase the amount of resources to
accommodate all needs.
A good example of California's experience with rural
transit programs is Governor Gray Davis' program to provide
shuttle services for farm laborers to work sites. Rural areas
offer few job opportunities and in some counties, available
jobs are concentrated in the seasonal agricultural sector where
the demand for labor fluctuates monthly. In the Southern San
Joaquin Valley, workers were being killed riding to work in
unsafe vehicles. Governor Davis' rural transit program uses
Federal funds to augment existing transit services and to add
safe transit shuttles to move laborers to their work. This
helps case labor costs for farmers and provides laborers with a
safe, low-cost transportation option. It is one example of
where a well designed rural transportation system can link
labor to jobs.
Q.4. The Administration proposes requiring States to consult
with intercity bus operators if they wish to certify that all
intercity bus needs have been met, and that there is no need to
spend the full 15 percent intercity bus set aside for that
purpose. What has been your experience with the intercity bus
program? Don't you agree that intercity bus operators should be
consulted before a State certifies that it does not need to
spend all of the funds?
A.4. California uses the full 15 percent set aside for its
Intercity Bus Program. This program funds public transit
projects that serve the intercity travel needs of Californians
in nonurbanized areas. We invite public and private operators
to propose projects and award funds on a competitive basis. Our
criteria for selection includes consideration of the proposal's
ability to meet State and
Federal program objectives, local support and operator
commitment, and sustainability of the project. In California's
case, needs outpace funding and the proposal process functions
as a consultation mechanism.
Q.5. The Administration is proposing to use the current State
warranty approach to labor protection for all of the State
managed programs. What has been your experience with the State
warranty in the 5311 Nonurbanized Program? Currently, the 5310
Program is exempt from the labor protection provisions because
subrecipients are private nonprofit organizations which do not
normally provide transit service. The Administration is instead
proposing a case-by-case waiver for nonprofit organizations.
Would this approach be workable?
A.5. State warrantees for the 5311 program work well in
California. However, we believe that the 5310 program could be
greatly impacted by the implementation of a case-by-case waiver
for nonprofit organizations. The 5310 program does contract
with many private nonprofit agencies, whose operations are very
reliant on a large volunteer workforce. Case-by-case waivers
would pose additional administrative burdens that could become
onerous for recipients and States and could dilute the
effectiveness of the program.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR REED
FROM JEFF MORALES
Funding Guarantees
Q.1. Would California end certain transit projects, if Congress
adopts the Administration proposal to guarantee only a portion
of the Transit Bust Fund?
A.1. That decision would lie with their sponsors and the
Metropolitan Planning Organizations that are responsible for
cobbling funding together. There is no question that losing a
funding guarantee would create uncertainty over the long-term
financing of a project, and very likely lead to the termination
of some. That presents a very untenable position for us for
several reasons. First, because we are increasingly dependent
on transit as part of our overall transportation system, and
the inability to move forward would have mobility consequences
throughout the State. Second, in most cases, transit projects
are a strong component of achieving air quality conformity. If
those projects were unable to proceed, conformity could be
jeopardized, and other Federal transportation funding would be
at risk.
Finance Committee Bonding Contract
Q.2. Some in the Senate have proposed using the transit share
of the gas tax to increase highway spending and start a bonding
program to meet the Nation's transit needs. If the shoe was on
the other foot, do you think you would support a proposal to
subject
all highway spending to an untested bonding scheme without
guarantees?
A.2. We do not support that shoe on either foot. One of the
great advances in the last two reauthorizations was the push,
not yet complete, to break down the barriers between modes of
the transportation. The reality is that California, like other
States, needs both transit and highways, and needs to be able
to evaluate them without bias. We would oppose any measure that
moves backward in that area, whether it is the bonding proposal
you mention, or the Administration proposal to subject New
Starts to a different cost-sharing formula than every other
transportation program.
RESPONSE TO A WRITTEN QUESTION OF SENATOR SARBANES FROM JEFF
MORALES
Q.1. Administrator Dorn testified last year before this
Committee that, ``The guaranteed funding commitment, in terms
of the Administration's point of view, has been one of the key
successes of ISTEA and TEA-21. Most importantly, in our view,
it has leveraged State and local investments in transit and in
transportation generally.'' Do you agree with that statement?
What do you believe would be the practical effect on your
members if TEA-21's guarantees around the entire transit
program were not continued in the next bill?
A.1. Yes, I agree with Administrator Dorn's statement. The
original intent of the very first surface transportation
program Acts was to encourage States and local communities to
step forward to leverage their dollars with Federal funds. It
is an intent that has continued through to TEA-21, and it has
been successful. In California, Governor Gray Davis made an
unprecedented $6 billion commitment of State funds to transit
and highway transportation projects in the first years of his
administration. Almost all of those projects utilize the State
funds as match to Federal and local dollars in a partnership
framework. According to FHWA, nationally, the distribution
of highway user revenues is almost two-to-one local and State
governments to Federal. Clearly, the intent of the program is
being realized.
The latest landmark in the highway and transit programs is
the guaranteed funding provisions of TEA-21. This funding
stability provision made possible long-term financial planning
for both highways and transit and made increased leveraging of
future program dollars much more feasible. Should these
provisions be repealed, it would require more funding to be
devoted to debt service because of greater perceived risk on
the part of the financial community. This could lead to
termination or delay for some projects, and
increase costs for others. The unintended consequence of such a
delay in project delivery would be failure to meet air quality
attainment and conformity targets (which may jeopardize
regional transportation improvement programs) and increased
congestion, which are counterproductive to the goals of the
national transportation program.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SHELBY FROM ROBERT
MOLOFSKY
Q.1. As with other members of the panel, your testimony opposes
elimination of the Bus Discretionary Program. The
Administration claims that providing these funds would make the
program more predictable and would enhance local planning. You
have said predictability is important in supporting the
continuation of the funding guarantees, so why isn't it just as
important in bus funding? What examples can you provide about
the kinds of projects where discretionary funding makes more
sense?
A.1. Mr. Chairman, thank you for your question. We indeed
support the guaranteed funding provisions under TEA-21 because
of the predictability and stability they have brought to the
industry. But when we allude to the importance of
predictability, we are referring to the firewalls that
guarantee funding for the entire program. Within the program
itself, however, the current breakdown between formula and
capital programs has worked well, and there is no reason to
change it.
ATU supports retention of the Discretionary Bus Capital
Program for a number of reasons. Most importantly, transit
systems have periodic bus replacement and facility needs that
simply cannot be met from the formula program alone. The role
of the Discretionary Bus Program is to address those needs. We
believe that eliminating this crucial program would only mean
that too little funding would be spread too thinly to provide
safe and efficient bus service throughout the United States,
especially with the drastic cuts in overall guaranteed funding
levels proposed in SAFETEA.
Therefore, in answer to your question regarding the kinds
of projects that would be best served by discretionary funding,
we suggest that the TEA-21 structure has worked well. Under
TEA-21 Capital Investment Programs, funds are restricted in
their distribution to transit agencies or government entities
that meet
specific criteria. Funds are distributed by allocation for New
Start projects and Bus Capital projects, and by formula to
qualifying areas for Fixed Guideway Modernization projects.
Other programs, such as Planning, Research, and Job Access and
Reverse Commute (JARC) are independent, and they do not come
under either the Formula or Capital Investment category. Under
this model, funded at increasing, guaranteed levels, the
Federal transit program has increased transit ridership in the
United States to the highest levels in more than 40 years.
And finally, the earmarking of the Bus Program has been the
main reason for the expansion of the Federal transit program
from what was once an urban-only program. Through the
earmarking process, lawmakers from both sides of the aisle in
the House and Senate--from rural and small urban areas--have
sought to introduce public transportation into their
communities to complement the highway system. This process has
served to generate a great deal of interest in the transit
program, and as a result, the largest growing transit areas in
the United States today are located in the southern and western
parts of the Nation. Had the discretionary Bus Program not been
in existence, many of those communities would have never been
able to experience the benefits of public transportation
because the formula program alone would not have been adequate
to steer badly needed funds toward our Nation's rural and small
urban areas. The bulk of the money would have instead gone
toward funding general transit needs in the Nation's
``traditional'' transit areas.
In summary, TEA- 21's funding structure has worked quite
well, and we see no reason to change the current system.
Q.2. The Administration proposes a modest new incentive tier in
the urbanized and nonurbanized programs. You do not support
this proposal. You indicate that part of your reason for
opposing this change is that it comes with limited overall
growth in the program, and thus would reduce basic predictable
funding in the later years as the incentive takedown increases.
Would you have supported the concept if the overall program
grew enough that basic funding was growing?
A.2. ATU supports, and has always supported, efforts to
increase public transportation ridership. Our locals have
engaged in numerous initiatives nationwide throughout recent
years that have focused on this crucial issue. However, it has
been our experience that such efforts are best performed at the
local level, where consideration of individual routes and
travel patterns may be examined in greater detail.
Therefore, we endorse the principles of the
Administration's ridership incentive concept. The Federal
Transit Administration (FTA) should be commended for attempting
to address this important issue. However, we believe that there
is little the Federal Government can actually accomplish toward
this worthy goal in the manner proposed. Specifically, there is
no direct connection between potential Federal incentive grants and
public transportation patronage. Transit ridership is determined by
a number of factors, including quality of service, convenience,
availability, and especially, the economy. As we have seen in
recent months, when unemployment is high, fewer people take the
bus or the train to work. Furthermore, although the FTA has
stated that urbanized areas that experience a ``significant''
decline in public transportation patronage would not be
eligible for so-called performance awards, it is difficult to
imagine how any transit system could achieve ridership
increases in a poor economy without cutting or significantly
reducing service to our most vulnerable citizens.
TEA-21 has proven that the best way for the Federal
Government to accomplish its goals in the ridership area is to
continue to provide record levels of funding to meet transit
infrastructure needs. Indeed, as indicated by the chart below,
the annual Federal investment in the transit program, beginning
with ISTEA and continued by the budgetary firewalls under TEA-
21, has had a direct affect on public transportation ridership.
------------------------------------------------------------------------
Transit Funding Transit Ridership
(fiscal year) (Calendar Year)
(Billions) (Billions)
------------------------------------------------------------------------
1996............................ $4.1.............. 7.9
1997............................ $4.4.............. 8.4
1998............................ $4.8.............. 8.8
1999............................ $5.4.............. 9.2
2000............................ $5.8.............. 9.4
2001............................ $6.3.............. 9.5
------------------------------------------------------------------------
Therefore, even if the whole program grows enough so that
takedowns are rendered insignificant, we still believe the best
way for the Federal Government to increase ridership is to
provide increased funding under the existing capital and
formula programs.
Finally, as mentioned above, the most expedient way to
increase transit ridership is to get people working again so
that they have a job to travel to. We hope the Committee
recognizes that the reauthorization of the highway/transit bill
is an opportunity to create thousands of good paying jobs.
Every penny that is deposited into the Highway Trust Fund
generates approximately $1.5 billion, and creates nearly 50,000
jobs.
Q.3. The Administration is proposing to adopt in law the
current State warranty approach to labor protection for all of
the State managed programs. What has been your experience with
the State warranty in the 5311 nonurbanized program? Currently,
the 5310 program is exempt from the labor protection provisions
because subrecipients are private nonprofit organizations which
do not normally provide transit service. The Administration is
instead proposing a case-by-case waiver for private nonprofit
organizations. This would appear to be an expansion of labor
protection to a whole class of recipients and to a whole
program which is now exempt in practice. Why is this
appropriate? Further, the Administration would apply this to
the New Freedom and National Parks Legacy Programs. Why is this
appropriate when these are completely new programs, and new
services?
A.3. First, with regard to the Section 5311 Program, nonurban
projects must currently satisfy the employee protection
requirements of 49 U.S.C. 5333 (b), formerly Section 13(c).
However, under this section, grants are labor certified without
a referral using the Department of Labor's (DOL) specially
designed Warranty arrangement. Although the Secretary may also
waive application of 13(c), this has never been done, and the
Warranty has been routinely applied. The Administration
proposes to allow 5311 grants to be subject to the requirements
of 5307, but only ``to the extent the Secretary considers
appropriate.'' Section 13(c) would apply, provided that the DOL
utilizes the expedited warranty procedure, which as you have
noted, is current practice. However, DOT could waive the
applicability of the special warranty for private nonprofit
subrecipients on a case-by-case basis.
There is no justification for changing the grant
requirement language of 5311. In answer to your question, under
this program, the warranty has worked well, and there is no
basis for the waiver. In fact, to reflect current practice, the
current language allowing for the waiver should be deleted.
The waiver first arose under the Elderly and Disabled
(5310) Program and was based on an early 1970's Department of
Transportation (DOT) decision that the waiver should apply to
private nonprofits. The primary reason for the decision was
that the program was very small in size, and the role of such
private nonprofits was quite limited. Clearly, this
justification no longer applies.
Your second question asks about the Elderly and Disabled
Program, but your statement actually misstates the present-day
application of 13(c) to the 5310 program. Currently, under
Section 5310, grants to State and local governmental
authorities are covered by 13(c), but grants to private
nonprofit corporations (passing through the State) are covered
by 13(c) only to the extent the Secretary considers
appropriate. As mentioned above, since 1974, DOT has deemed
that 13(c) shall not apply to private nonprofit grant
recipients under 5310. Such decision was based on the limited
size of the program at the time (approximately $15 million) and
the limited role of private nonprofits.
The Administration proposes to apply Section 5310 grant
requirements to all requirements of a grant under Section 5307,
but only ``to the extent the Secretary considers appropriate.''
This amounts to a possible waiver of 13(c) for the whole 5310
program--grants to State and local governments and grants to
nonprofits. Therefore, while your question suggests that there
would be an expansion of labor protection, the bill would
actually remove 13(c) coverage because it would repeal current
5310 subsection (a)(1), which subjects grants to State and
local governments to all requirements of a grant or loan under
Section 5309.
The Section 5310 program is now funded at nearly $100
million annually. Denying labor protection on the basis of the
size of the program, therefore, is no longer appropriate. As
with all 5311 grants, Section 13(c) should now apply to the
entire 5310 program, whether such grants are allocated to
States, local governmental authorities, or private nonprofits.
Next, with regard to 13(c) coverage for the proposed New
Freedom and National Parks Legacy Programs, as we stated in our
testimony, every surface transportation reauthorization bill
enacted since 1964 has been linked to a strong labor policy
that provides employee protections for public transit workers.
Today, as in the past, ATU's support for reauthorization will
be contingent on the continuation of those policies and their
application to any new programs or innovative finance mechanisms
created through the new bill.
There is a strong precedent for attaching labor protections
to new Federal transit programs. For example, the highly
successful JARC Program, established in 1998, was enacted on
the condition that grants would be subject to all of the terms
and conditions of a grant made under Section 5307. The value of
this historic link between a strong transportation bill and
sensible labor policy has been clearly recognized by the
Administration, which has recommended the application of 13(c)
to the new programs.
A grant under the New Freedom Program would be subject to
the requirements of 5307, but only ``to the extent the
Secretary considers appropriate.'' Section 13(c) would apply,
provided that the Secretary of Labor utilizes the special
warranty. However, DOT would be authorized to waive the
applicability of the warranty for private nonprofit
subrecipients on a case-by-case basis as the Secretary deems
appropriate.
As we mention in our testimony, the warranty could work
here if the New Freedom Program was folded into the JARC
program. (As discussed below, JARC grants to applicants serving
populations under 200,000 are labor certified without a
referral using the DOL specially designed warranty
arrangement). However, again, the waiver option should be
removed. The Administration would authorize $145 million for
this program in the first year alone, and $162 million annually
by the end of the reauthorization. A waiver for a program of
this size is certainly not appropriate.
Finally, ATU supports the Administration's proposed
National Parks Legacy Project. Labor protections are
appropriate here for a number of reasons. First, the program
would establish new service in only some instances; there are a
number of parks that are already running bus service. Second,
as with all other elements, if there is no impact on existing
employees, the protections remain dormant. Third, this program
would be open not only to federally owned or managed parks, but
also refuges, and recreational areas, which are located in
urban, suburban, and rural areas. Therefore, the waiver option
should not be available under this program.
Q.4. Currently, many recipients in the Job Access and Reverse
Commute program are either small rural transit operators or
private nonprofit organizations. Yet each JARC grant is treated
as if it were being made to an urbanized area transit agency.
Thus a private nonprofit agency providing rural service is
subject to three different processes for labor protection if
they get rural, elderly, and disabled persons and JARC funds.
Why shouldn't a rural transit operator be able to get a JARC
grant and be covered by the current State warranty? And why
shouldn't a private nonprofit organization that gets grants
under the elderly and disabled persons program and thus is
exempted not also be exempted under the JARC program?
A.4. Your first question asks: Why shouldn't a rural transit
operator be able to get a JARC grant and be covered by the
current State warranty? Actually, since the new guidelines were
established in 1999, that is exactly how DOL has processed JARC
grants. Under the regulations, grants to rural and small urban
operators serving populations under 200,000 are labor certified
without a referral using the DOL specially designed warranty
arrangement. The regular 13(c) process applies to JARC grants
in areas with a population above 200,000.
But despite the success of the new 13(c) regulations for
the JARC Program, SAFETEA would substantially alter the
application of 13(c) under this program by using the warranty
and waiver option for all JARC grants (regardless of the size
of the population served). The Administration proposes to allow
the Secretary to waive the applicability of the special
warranty for private non-profit subrecipients on a case-by-case basis
as the Secretary deems appropriate.
There is no support or justification for changing the grant
procedures under this program. Since the 1999 regulations were
released, and the separate procedures were set for applicants
based on population, there have been no problems regarding this
program. The new time limits are working perfectly, and no JARC
grants have gone unfunded because of 13(c). The current
coverage should be maintained without a new waiver option.
Finally, you ask why shouldn't a private nonprofit
organization that gets grants under the elderly and disabled
persons program and thus is exempted not also be exempted under
the JARC program? As we stated in answer to question #3,
because 5310 has grown substantially since 1974 (when the 13(c)
waiver was first instituted for nonprofits), labor protections
should now apply to the entire 5310 program, whether such
grants are allocated to States, local governmental authorities,
or private nonprofits. Therefore, we would of course object to
the possibility of JARC grants being
exempted in the same manner. And, we again note that JARC
grants to applicants serving populations under 200,000--where
the majority of nonprofit organizations operate--are labor
certified without a referral through the warranty arrangement.
History shows that this process has worked well, and there is
no reason to change the system.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR REED
FROM ROBERT MOLOFSKY
Funding
Q.1. Mr. Molofsky, I appreciate your willingness to not only
seek more money for transit but also propose a source for such
funding, namely the gas tax. Do other nontransportation unions
support this position?
A.1. Organized labor stands united in the effort to raise the
Federal gas tax. ATU and the Transport Workers Union (TWU) are
working closely with the American Federation of State, County,
and Municipal Employees (AFSCME), the International Association
of Bridge, Structural, Ornamental, and Reinforcing Ironworkers,
the International Union of Operating Engineers, the Laborers'
International Union of North America, and the United
Brotherhood of Carpenters and Joiners of America to deliver the
message that investing in America's transportation
infrastructure through a nominal gas tax increase is the best
way to stimulate the economy.
Also, in an effort to secure additional resources, the AFL-
CIO's Transportation Trades Department (TTD), made up of 34
unions, has endorsed using the interest earned in the Highway
Trust Fund for trust fund purposes and transferring the 2.5
cents of the tax on ethanol that currently flows into the
General Fund to the Highway Trust Fund.
ATU supports raising and indexing the Federal gas tax as
recommended by leadership of the House Transportation and
Infrastructure Committee. This proposal would provide the
revenue stream necessary to double the annual Federal
investment in highways--to $60 billion--and public
transportation--to $14 billion--as called for in ATU's
comprehensive plan, ``Next Stop, Real Choices,'' released last
summer. ATU also supports bipartisan proposals to draw down
reserves in the highway trust fund, and collect the interest on
fund reserves.
Each penny of the motor fuels excise taxes currently yields
over $1.7 billion per year, generating more than 80,000 jobs in
the transportation industry, with about $1.4 billion being
deposited into the Highway Account of the Highway Trust Fund
and $350 million deposited into the Mass Transit Account. A
two-cent gas tax increase, for example, would cost the average
driver a mere $12 per year, or six cents per day. The Federal
motor fuels tax is currently 18.4 cents, and has not been
raised since 1993.
With unemployment at an 8-year high and nearly two million
workers unemployed for more than 6 months, President Bush and
the Congress should approve a plan that will create jobs in our
communities and ensure that our future transportation needs are
met. As a bipartisan group of 43 United States Senators
recently stated in a letter to President Bush, ``A robust
public transportation infrastructure is vital to continuing
America's economic growth.''
Security
Q.2. In reviewing your testimony, I was struck by your comment
that a recent survey of ATU members showed that 80 percent of
respondents reported that they had not received any security
training from their employer. As one who believes this is a
vital issue that must be addressed in the reauthorization, I
would be interested to learn if the ATU has any specific
legislative proposals or funding levels to ensure that transit
employees, who are our eyes and ears in keeping transit systems
and riders secure, have the training they need?
A.2. Again, Senator Reed, thank you for your question and for
your continuing efforts to address the pressing security
concerns of the transit industry. The ATU firmly believes that
in order to ensure that all frontline transit employees,
including vehicle operators and maintenance employees, receive
the necessary security training, there must be a specific
legislative and regulatory requirement that all transit systems
develop and implement, through a security committee composed of
an equal number of employee representatives and management
representatives, a comprehensive, system-specific, security
training program that includes regularly scheduled reviews and
update sessions and new employee training. Failure to meet the
training requirement should result in the withholding of FTA
funds in an amount determined by the Secretary.
In addition to training, all transit systems should be
required to adopt a safety and security plan as a condition of
receiving FTA funding. Currently, only rail fixed guideway
transit systems are required to have such a plan. There is no similar requirement for transit bus systems. In today's new reality, all
transit systems, bus and rail, should adopt a security plan, again,
to be overseen and implemented by a security committee, including
both management and employee representatives. Minimum standards
for such plans should be set by the FTA after thorough
consultation with industry security experts, the Transportation
Security Administration (TSA), the transit industry and transit
labor organizations.
As I mentioned in my testimony, a lack of funding is the
number one obstacle for transit agencies attempting to address
security needs right now. In order for these agencies to meet
the minimum training and planning requirements discussed above,
Congress must dedicate a source of funding for these purposes.
At a minimum, $15 million a year should be authorized from the
general fund to assist transit agencies in meeting these
requirements.
In order to address the immediate concern for training, the
ATU is currently calling on the Department of Homeland Security
(DHS) and TSA to dedicate funding for frontline transit
employee security training. Further, in the House, we have
endorsed and are seeking passage of H.R. 1148, The Public
Transportation Systems Vulnerability and Reduction Act of 2003,
introduced by Representatives Juanita Millender-McDonald (D-
37th/CA) and Mike Ferguson (R-7th/NJ). H.R. 1148 would authorize
$8 million (of the necessary $15 million) solely for frontline transit employee security training. We are currently seeking a sponsor for a
companion bill in the
Senate.
RESPONSE TO WRITTEN QUESTIONS OF SENATOR SARBANES FROM ROBERT
MOLOFSKY
Q.1. Administrator Dorn testified last year before this
Committee that ``The guaranteed funding commitment, in terms of
the Administration's point of view, has been one of the key
successes of ISTEA and TEA-21. Most importantly, in our view,
it has leveraged State and local investments in transit and in
transportation generally.'' Do you agree with that statement?
What do you believe would be the practical effect on your
members if TEA-21's guarantees around the entire transit
program were not continued in the next bill?
A.1. Senator Sarbanes, thank you for your question. We
certainly agree with Administrator Dorn's statement on the
importance of TEA-21's firewalls. Without question, the new
programs, planning rules, and increased levels of funding for
transit adopted under ISTEA and TEA-21 have changed the nature
of America's transportation policies. However, the change in
United States surface transportation law that has had the
greatest impact on improving the quality and delivery of
transit services has been the guaranteed funding levels for
transit; between fiscal years 1998-2003, $36
billion was set aside for public transportation purposes by a
unique budgetary firewall erected between transit funds and
other programs funded from the United States domestic
discretionary budget.
Under TEA-21's budget structure, funds taken from the
transit program are not eligible for any other Federal
discretionary program. This unique transit firewall, designed
to ensure the funding of FTA programs at specific annual
guaranteed levels, has worked exactly as designed; since 1998,
the Congress and two separate Administrations have honored TEA-
21's firewalls by recommending funding of the Federal transit
program at the guaranteed levels.
As a result of this predictable, increased funding, transit
agencies have been able to engage in long-term planning,
enabling them to expand service through the more than 360,000
highly skilled transit professionals who provide safe, top
quality public transportation. The guaranteed funding levels
have provided a unique sense of stability in the public
transportation industry, which is reflected in the recent
ridership surge.
ATU supports maintaining the funding guarantees included in
TEA-21, especially given the proven ability of systems to rely
on the guaranteed funds and leverage future Federal funding via
the use of grant anticipation financing. Such financing has
generated a record number of bus and rail projects during the 6
years of TEA-21, creating thousands of new jobs in the public
transportation industry. As a result, ATU membership now stands
at an all-time high of 180,000, up from approximately 155,000
in the year preceding TEA-21.
Therefore, given the Administration's past recognition of
the importance of TEA-21's guaranteed funding provisions, we
cannot understand why SAFETEA proposes to guarantee only a
portion of the program, rather than the entire program, as
carried out under TEA-21. In fact, for fiscal year 2004, the
Administration is proposing a guaranteed level of only $5.9
billion for the Federal tran-
sit program, which is a $1.3 billion cut from the current
fiscal year. The guaranteed funding level in SAFETEA for fiscal
year 2004 is 17.9 percent less than the guaranteed funding
level in TEA-21 for fiscal year 2003. In fact, under SAFETEA, the
Administration would not even reach the current level of spending
by the end of the reauthorization period. Guaranteed public transit
funding would be 8 percent less in fiscal year 2009 than it is
in fiscal year 2003!
For our members specifically, the discontinuation of the
firewalls would mean the loss of jobs. In addition to
leveraging significant investment from the States, the TEA-21
firewalls have also been the driving force behind many of the
transit ballot measures that have passed at the local level in
recent years. ATU has participated in many of the campaigns for
these local transit initiatives (attached), many of which
passed only because of the promise of guaranteed Federal funds
to match local dollars. In many of these local campaigns, a
loss at the ballot box would have meant a significant reduction
in fixed route services, loss of man hours, and layoffs.
The Congress must ensure that the guaranteed Federal
funding levels under TEA-21 are preserved and that the next
surface transportation bill maintains these crucial firewalls
so that we may continue to provide the highest quality, safest
possible level of transit service.
Q.2. The ATU has proposed an incentive program to encourage
States to make more resources available for transit. Why did
you choose this model rather than a direct mandate? What are
the potential benefits of this proposal? Are there any other
examples in Federal law of incentive programs like this?
A.2. Thank you for the opportunity to discuss the ATU's
proposed Flexibility Incentive Grant (FIG) Program, which is
designed to provide incentives that would encourage States to
establish new sources of revenue for transit projects and
services and to reward States for creating more flexibility in
the use of their existing transportation funds. Attached please
find draft legislative language creating such a program.
Despite record levels of Federal investment and the
undeniable will of local jurisdictions to tax themselves for
the purposes of increasing the level and quality of public
transportation services, State funding for public
transportation has been grossly inadequate in recent years. As
a result of this and other factors, we are currently
experiencing widespread fare increases, service cuts, and
massive layoffs in the transit industry.
The FIG Program is designed to encourage States to think
twice before they cut transit funding by providing ``bonus''
Federal transportation dollars to those States that increase
public transportation funding or take steps to increase
funding. Significantly, States could use funds derived under
the FIG Program for any highway or transit projects eligible
for assistance under Title 23 or Chapter 53 of Title 49.
Moreover, the program would be funded out of General Funds and
therefore would not put further pressure on the Federal Highway
Trust Fund.
Under the proposed FIG Program, the Secretary of
Transportation would be authorized to allocate $5 million
annually to each State that increases transit expenditures by
at least 10 percent as compared to the previous fiscal year. If
a State is already expending more than $1 billion on public
transportation, the Secretary would be authorized to allocate
$10 million to such State if it increases transit expenditures
by at least 1 percent.
In addition, States would be eligible for grants on the
condition that they create new dedicated sources of revenue for
public transportation. Such sources may include the dedication
of new State motor fuels taxes, sales taxes, interest on
existing highway funds, motor vehicle excise taxes, tolls,
loans to be made out of highway funds, or other sources of
funding.
Finally, in order to encourage flexibility in the spirit of
ISTEA, as continued under TEA-21, the FIG Program would
authorize the Secretary of Transportation to reward States for
amending their existing statutes or constitutions to allow
funds that are currently restricted for highway purposes only
to be eligible for transit projects and services as well as
highway purposes.
We chose the framework of a bonus program rather than a
direct mandate because the intent of the FIG Program is not to
penalize States for failing to invest in transit; it is to
encourage them to use their existing transportation resources
in a more efficient manner. In today's fiscal climate, State
legislatures, facing huge deficits, in many cases have little
choice but to freeze or cut funding for many important
programs, including transit services. Penalizing States for
such actions would be not only unfair, but it would also put
further stress on State budgets and transportation systems.
Therefore, the FIG Program is modeled as a ``bonus'' program to
be awarded in addition to any funds States receive through
Title 23 or Chapter 53 of Title 49, and it would not affect
existing formulas under which States receive Federal
transportation funds.
This proposal has many potential benefits. It seeks to
unlock billions of dollars in State resources, each year, for
public transportation, community and rural transportation, and
ADA services. While some States are heavily investing in public
transportation, others are struggling to meet their
transportation needs simply because their archaic laws prevent
them from using gas tax receipts for any purpose other than
highway use. Due to State constitutional or statutory
provisions, in 34 States, all highway user tax distribution
funds must be used solely for highway purposes. The Federal
Government realized that such a policy was no longer efficient
in 1982 when it carved out a small portion of the Federal
Highway Trust Fund for transit. If the States did the same with
their own transportation dollars, when combined with Federal
dollars, perhaps the United States could finally approach the
more than $40 billion annual level that is needed for our
Nation's transit systems.
Of course, the proposal is aimed at much more than changing
State constitutions. Essentially, it seeks to encourage State
legislation similar to Arkansas Senate Bill 581, now Act 949 of
2001, which created a permanent, dedicated source of revenue
for transit through the establishment of a rental car tax. The
State's new Public Transit Trust Fund is used to provide
expanded public and community transportation throughout
Arkansas. Similarly, Maryland in 2001 approved a $500 million
transit initiative that has increased public transportation
services in every corner of the State, from St. Mary's County
to Baltimore. The FIG Program would reward States such as
Arkansas and Maryland for dedicating a significant portion of
their revenue toward public transportation, and it would
encourage other States to take similar action.
Finally, with regard to examples of similar incentive
programs under Federal law, there are currently two incentive
programs in the transportation sector which served as the model
for the proposed FIG Program. Both programs attempt to
encourage certain behavior on the part of the States in
connection with transportation policies. First, there is the
TEA-21 created program that provides ``Safety incentive grants
for use of seat belts'' (23 U.S.C. 157, TEA-21 Section 1403).
This program requires the Secretary to determine which States
had, for each of the previous calendar years and the year
preceding the previous calendar year, a State seat belt use
rate greater than the national average seat belt use rate for
that year. The program authorizes DOT to make grants to those
States that have reached a certain level of seat belt usage and
States that have implemented innovative projects to promote
increased seat belt use rates. Similarly, 23 U.S.C. 163 (TEA-21
Section 1404) authorizes ``Safety incentives to prevent
operation of motor vehicles by intoxicated persons.'' Under
this Section, the Secretary is authorized to make a grant to
any State that has enacted and is enforcing a law that provides
that any person with a blood alcohol concentration of 0.08
percent or greater while operating a motor vehicle shall be
deemed to be driving while intoxicated.
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