Management & Operations

Critics decry 'small starts' bias

Posted on September 13, 2006 by Cliff Henke

Perhaps the most visible — and controversial — of the FTA’s policy changes in recent months are those that begin to interpret the new so-called “small starts” program created by SAFETEA-LU.

Congress created the new program to streamline the New Starts evaluation process for projects costing less than $250 million and seeking less than $75 million from the program. Legislators directed the FTA to come up with rules that make the process for receiving those funds easier.

Specifically, Congress wants the FTA to lessen the burdens for demonstrating project cost-effectiveness and financial responsibility. It also combined the preliminary engineering and final design stages in the process for these smaller projects.

FTA rules are not ready
This year’s budget for the Major Capital Investment Program will likely not include any money for small starts because its rules will not be final until early 2008, irritating program advocates who see the rationale as a tactic to sacrifice small projects on the budget-cutting altar. In addition, the FTA’s new interim guidelines issued in June, which will govern how the program will be implemented until the final regs are finalized, have also encountered a storm of criticism.

One group of critics believes that the new rules unfairly give BRT an advantage by rewarding projected ridership gains too much over other issues, such as economic development generated by a project. These critics argue that the program was also designed to fund streetcar and small commuter rail projects as well, which might not generate ridership gains initially but will help shape the neighborhoods they serve first. This would support longer-term transit patronage.

Ron Fisher, FTA’s project planning director, says one reason why economic development benefits do not receive a quantifiable “scoring” similar to cost-effectiveness or financial capability analysis is because it is so difficult to measure these effects and prove that they were directly caused by the transit investment.

Another group of critics believes that the “very small starts” sections of the guidelines, which would virtually automatically give them a “medium” rating, have so few requirements that they treat arterial-based BRT not much differently from traditional bus service. Under the rules, very small starts are defined as projects costing less than $50 million total and less than $3 million per mile (not including the vehicles). They also must be projected to have at least 3,000 passengers per average weekday and not include a new “fixed guideway” such as an exclusive bus lane or, in the case of a low-cost rail project, any new trackage. In addition, the operating costs of these projects cannot inflate the sponsoring agency’s existing operating budget by more than 5%. These critics do not want to see that the very small starts treatment does not skew the whole small starts program to lower-cost, arterial-type “microprojects” that consume the funding. Accordingly, they want to see this category limited to, say, no more than a quarter of all small starts funding.

Will more go it alone?
Yet another school of thought believes that even with the more streamlined process, small starts suffer from the same competition for scarce federal dollars that their bigger counterparts do, and thus the new rules will provide little relief to project sponsors. In fact, a growing number of both “big” and “small” start cities are “getting out of line” entirely and instead trying to implement these projects with only formula grants or bus grants from other programs such as highway grant transfers, or even with non-federal funding, such as state, local and even private funding sources.

Many advocates of the small starts program, including some within the halls of Congress, believe that the program was “created for streetcars.” They tend to ignore many equally strident supporters of BRT and small rail projects as cost-effective change agents in commute patterns, with all the public-policy benefits that come with that result. However, if streetcar supporters can continue to sustain local support from the land developers and other stakeholders who want these projects, they might be well advised to use this support to find nonfederal funding. To continue to wish otherwise might be unrealistic in today’s fiscal and political climate.

To read the interim rule, visit www.fta.

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