Mass Transit

The Bay Area Rapid Transit District (BART) intends to spend more than $1.1 billion, including $750 million in federal funds, to extend mass transit services to the San Francisco International Airport. Controversy over the project, which centers on concerns over the project's environmental impact and cost, has resulted in two redesigns of the project since 1992. Before the Federal Transit Administration (FTA) can provide BART with the requested funds, FTA must ensure that BART complies with federal environmental laws and develops a viable financing plan. This report describes (1) the actions that FTA must take before agreeing to fund the project; (2) the project's current schedule and estimated cost and the factors that could affect them; and (3) the project's finance plan, including assumptions that could affect its viability.

GAO found that: (1) before signing the BART funding grant agreement, FTA must ensure that BART has met all environmental requirements and secured necessary project financing; (2) FTA must also certify that BART environmental and financing plans, and cost estimates are reasonable and determine whether other transportation alternatives have been considered; (3) FTA and BART may not be able to resolve congressional concerns 60 days prior to the signing of the funding agreement, which BART expects to occur in October 1996; (4) BART estimates that its airport extension project will cost $1.167 billion, with construction beginning by October 1996 and line opening in October 2000; (5) the BART construction schedule is ambitious, since environmental reviews may not be completed by October 1996, and expected savings from innovative technology and cost escalations are uncertain; (6) BART expects to obtain $750 million in federal funding, with the remaining $471 million coming from the San Francisco airport, the state, and local sources; (7) BART must develop a borrowing program, since its accelerated construction schedule will outpace its funding; and (8) factors that could affect the finance plan's viability include BART receiving sufficient federal funds each of the next 7 fiscal years, the state allowing BART to use its own revenues as secondary collateral for loans, the airport providing its $200 million contribution, and other state and local contributors capping their BART pledges due to budget constraints.