Just short of three years following the expiration of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFTEA-LU), Congress overcame partisan posturing and a host of other hurdles to pass a new 27-month surface transportation bill, dubbed Moving Ahead for Progress in the 21st Century Act (MAP-21), which was signed by President Barack Obama in early July.
While a dedicated funding source was still not identified, steam began to build toward a solution as Conferees from each party met late in June prior to the expiration of the latest SAFTEA-LU extension. During the week leading up to the deadline, both chairman of the House Transportation & Infrastructure Committee John L. Mica (R-FLA) and Sen. Barbara Boxer (D-CA), chairman of the Environment and Public Works Committee, touted a bipartisan two-year bill was in the offing.
Map-21, which was passed by the House 373 to 52 and the Senate 74 to 19, funds public transportation at current levels for the final three months of Fiscal Year (FY) 2012, $10.578 billion in FY 2013 and $10.695 billion in FY 2014. Funding authorized from the Mass Transit Account of the Highway Trust Fund amounts to $8.478 billion in FY 2013 and $8.595 billion in FY 2014, with $2.1 billion authorized from the General Fund in each fiscal year.
While the bill was optimistically embraced by much of the public transit industry that had been longing for some sort of stability, there was much disappointment in the overall financial investment as well as the inability to identify the all-elusive dedicated funding source.
“Give the two parties credit for striking a compromise and actually passing a bill,” says Jeffrey Boothe, partner at Holland & Knight LLP. “The industry should be expressing its gratitude for at least 27 months of stability in terms of funding. Having said that, the funding issue will not go away and it has to be addressed; we keep kicking that can down the road but it will not go away.”
“It’s hard to think of this bill as anything other than a stopgap,” says Erich Zimmerman, Taxpayers for Common Sense, a non-partisan budget watchdog group. “It gives a couple of years to get together, hopefully, to figure out how to pay for a bill in a way that taxpayers would agree is responsible.”
Optimists hope the “stopgap” authorization sets the table for identifying a funding source over the next two years, however, there still is no consensus on what that source could be, including raising the gas tax. Another issue Zimmerman alludes to is picking up on some of the policy issues that were addressed separately by both the original House and Senate bills, where a resolution was not reached.
“We talk about things like a vehicle-mile-travel charge, tolling, increasing public-private partnerships and all that kind of stuff, and all that should definitely happen, but it doesn’t stop the need to raise the gasoline tax, at least in connection to inflation,” says Rob Puentes, sr. fellow at the Brookings Institution’s Metropolitan Policy Program.
“My sense is that they solved today’s problem and they’ll worry about funding after the election when they have to deal with the next authorization bill during the next Congress,” adds Boothe. “There is a very outside possibility that financing could be addressed in the end of the year confluence of separate crises that will all be joined into a single crisis, in terms of how to address the functioning of the federal government, but that is an outside possibility.”[PAGEBREAK]
While there are a vast number of changes, additions and deletions to MAP-21, METRO Magazine compiled eight of the bill’s highlights based on the Conference Report released in July.
1. America Fast Forward/TIFIA
Both of the initial House and Senate authorization proposals significantly expanded Transportation Infrastructure Finance and Innovation (TIFIA), the popular federal surface transportation credit assistance program, increasing funding from $120 million in FY 2012 to $1 billion annually.
The Conferees largely adopted the Senate’s TIFIA provision, with some modifications establishing application procedures to impose deadlines for actions by the U.S. Department of Transportation (U.S. DOT) and requiring an annual application process report by the U.S. DOT. The conference report authorizes funding for the TIFIA program at $750 million in FY 2013 and $1 billion in FY 2014.
2. Fixed Guideway Capital Investment Grants (New Starts)
MAP-21 will reform and streamline the “Fixed Guideway Capital Investment Grant” program, which was previously the “Major Capital Investment Grant” or “New Starts” program. Based on extensive feedback from project sponsors and other stakeholders, the bill streamlines the New Starts process to accelerate project delivery by eliminating duplicative steps in project development and instituting a modified program structure that will allow the Federal Transit Administration (FTA) to review proposals quickly, without sacrificing effective project oversight.
Both the House and Senate New Starts provisions included expanded use of warrants to expedite the project rating, evaluation and approval processes. The conference report adopts the Senate’s language expanding the use of warrants for projects with a New Starts share not exceeding $100 million or 50% of total project costs.
Projects under $100 million can utilize an expedited review process if they meet standards of similar highly qualified projects. The bill also creates a category of demonstration projects for sponsors that propose a significant amount of local and/or private funding and reduce the federal commitment required for the projects.
MAP-21 also establishes a new category for capital investment projects by authorizing core capacity projects, which will undergo the same process as other New Starts projects but provide an opportunity for existing systems to make necessary but significant investments that were not previously eligible for funding. The conference report requires that eligible activities under a core capacity project achieve at least a 10% increase in capacity along a corridor.
The Senate agreed to a House request to modify the definition of bus rapid transit (BRT) projects in the Senate bill to allow broader use of the program. There are also incentives for the development of BRT projects that incorporate elements of fixed guideway transit like light rail.
The report authorized $1.907 billion for each of Fiscal Years 2013 and 2014. The level is below the $1.955 billion authorized in FY 2012.
3. Formula Grant Programs
Urbanized Area Grants (Sec. 5307, 5336) continues as the largest program for federal investment in public transportation. MAP-21 will allocate $4.398 billion in FY 2013 and $4.459 billion in FY 2014 for urbanized area programs, slightly less than the $4.552 billion in FY 2012. The Job Access and Reverse Commute (JARC) program activities will now be funded under the Sec. 5307 formula program.
The bill authorizes $422 million in FY 2013 and $427.8 million in FY 2014 for a Bus and Bus Facilities Formula program. The funding level, which is below the current $984 million, was a major change from what the Senate bill had originally proposed, with essentially no funding as the bill was reported from committee and only $75 million authorized as a takedown from the Capital Investment Grants account when S. 1813 was passed by the Senate. The new program is a formula grant program, instead of a discretionary grant program in current law, and does not restrict agencies that operate rail services from eligibility, as proposed in the House T&I Committee bill, H.R. 7. A minimum allocation is made available to all states, with the remaining funds distributed based on population and service factors.
The conference agreement also retained Sec. 5340 formula grant programs for High Density States and Growing States. The program is authorized at a level of $518.7 million in FY 2013 and $525.9 million in FY 2014, an increase of more than 13%.
The Elderly and Disabled (Sec. 5310) and New Freedom (Sec. 5317) Programs are combined into a single program that will fund activities designed to enhance the mobility of seniors and individuals with disabilities (the new program remains under Sec. 5310). The consolidated program will increase the level of resources available for elderly and disabled transportation programs.
The conference report also authorizes increased funding for Rural Area Grants (Sec. 5311), to fund public transportation activities in rural areas. The Sec. 5311 Rural Formula program is funded at $599.5 million in FY 2013 and $607.8 million in FY 2014, compared to an estimated $547.3 million in FY 2012. The bill also provides for rural job access and reverse commute activities to now be funded under this section and repeals the Clean Fuels Formula Program as well as the Transit in the Parks Program.
4. Metropolitan and Statewide Transportation Planning
The Conference report improved metropolitan and statewide planning processes to incorporate a more comprehensive, performance-based approach. The report requires Metropolitan Planning Organizations (MPOs) to establish performance targets that address issues such as safety and state of good repair. This will include a system performance report. Additionally, the final language mandates that the structure of all MPOs, designated as “Transportation Management Areas,” must include officials of public agencies (including transit agencies) that administer or operate major modes of transportation in the metropolitan area.
The conference report also creates a pilot program to fund planning efforts for transit oriented development projects. The pilot is funded at $10 million in FY 2013 and 2014. Funding will assist with costs of comprehensive planning for new fixed guideway capital projects or core capacity improvement projects funded with federal dollars.
5. Operating assistance/subsidies
The conference report adopts “100 bus rule” language, as proposed by the American Public Transportation Association. This provision allows transit systems in urbanized areas with populations greater than 200,000 to utilize portions of their 5307 funding for operating assistance if their system operates 100 or fewer buses in peak service. The conference report does not include language that would have allowed transit systems to utilize a portion of their 5307 funding for operating assistance during periods of high unemployment.
The Senate version of MAP-21 passed in March 2012 included a provision that would have equalized the amount of pre-tax employer-provided mass transit benefits with the amount of pre-tax employer-provided parking benefits at $240 per month, but this provision was dropped in the conference committee report. Pre-tax transit benefits will remain capped at $125 per month.
6. Project Delivery
MAP-21 combines provisions from the House and Senate bills focusing on shared priority of accelerating project delivery. It maintains the vast majority of project acceleration provisions from S. 1813 and provisions from the House bill, in addition to new provisions that will maintain substantive environment and public health protections while streamlining the creation and use of documents and environmental reviews, enhancing efficiency and accountability in the project delivery process.
The conference report adopts and modifies provisions from the House bill directing the Secretary of Transportation to designate, through rulemaking, certain activities as categorical exclusions under the National Environmental Policy Act. The Secretary of Transportation is also directed to designate projects receiving limited federal assistance as a categorical exclusion. The categorical exclusion applies to any project that receives less than $5 million in federal funds and any project with a total estimated cost of not more than $30 million receiving federal funds, comprising less than 15% of the total estimated project costs.
7. Public Transportation Safety Program
Included in the report is a negotiated compromise between Senate and House transit safety proposals. The provision grants authority to the Secretary to create a national safety plan for all modes of public transportation; to set minimum safety performance standards for all rolling stock not otherwise regulated; and to establish a national safety certification training program for federal and state employees, or other designated personnel, who conduct safety audits and examinations of public transportation systems and employees of public transportation agencies directly responsible for safety oversight.
Under this provision, all recipients of federal transit funding are required to establish, and have certified, a comprehensive safety plan based on set criteria. Those states with rail fixed-guideway systems are required to have an approved state safety oversight program that establishes a state safety oversight agency, which assumes oversight-related responsibilities
A formula grant funding program for up to 80% in federal match dollars to develop and carry out state safety oversight programs has been authorized. The state safety oversight agencies are required, among other things, to review, approve, oversee and enforce implementation of transit agency safety plans, to conduct triennial safety audits, and to provide annual safety status reports to the FTA and others. While transit agency safety oversight will be carried out by the state safety oversight entities, the Secretary will oversee implementation by those state safety oversight entities and has the authority to audit their activities. In the event that a recipient is found to be noncompliant with safety requirements, the Secretary may withhold federal funding or require up to 100% of federal funds be used for corrective safety actions. In the event that a state safety oversight agency is found to be noncompliant, the Secretary is granted a range of options, including but not limited to issuing directives, requiring more frequent oversight, and/or withholding federal funds.
Additionally, a waiver provision for agencies not exceeding a set amount of miles or unlinked passenger trips as well as a provision allowing multi-state systems to establish a joint oversight entity was also authorized.
8. State of Good Repair Grant Program
MAP-21 creates a new “State of Good Repair” grant program that would replace the current Fixed Guideway Modernization program. The new program would distribute $2.1 billion in each of fiscal years 2013 and 2014 to fixed-guideway systems that use and occupy a separate right-of-way for exclusive public transportation use, rail systems, fixed catenary systems, passenger ferries and BRT systems.
Funding could be used for a variety of activities, and recipients would be required to develop asset management systems that include capital asset inventories and condition assessments, decision support tools and investment priorities. The bill would apportion 50% of the total based on factors used in the rail tier of the urban formula program in effect for FY 2011, under which 60% is distributed on revenue vehicle miles and 40% on fixed guideway route miles. It would apportion the other 50% of funds under a formula that distributes 60% of funds based on vehicle revenue miles and 40% on fixed-guideway directional route miles. In all cases, only those segments in revenue service for at least seven years would be eligible for funding.
The measure also authorizes $60.9 million in FY 2013 and $61.7 million in FY 2014 for a “High Intensity Motorbus State of Good Repair” program. Funds would be distributed 60% on the basis of vehicle revenue miles and 40% on the basis of directional route miles. This program would provide funding for public transportation that is provided on a facility with access for other high-occupancy vehicles and would be limited to segments where high-intensity motorbus services have been in revenue service for at least seven years.