Mass Transit

Since the early 1970s, the federal government has picked up the tab for a large part of the nation's investment in urban mass transportation. Much of this investment has come through the Federal Transit Administration's (FTA) "new starts" program, which funds new rail, bus, and trolley projects that use separate and exclusive rights-of-way. In the last five years, this program has provided state and local transit agencies with about $3.8 billion for such projects. The Transportation Equity Act for the 21st Century, enacted in June 1998, authorizes $8.2 billion for new starts transportation projects through fiscal year 2003. However, FTA estimates that it will need $12.1 billion to build 42 additional projects now in the preliminary engineering and final design phases. FTA also expects that more than $40 billion in federal funding will be requested to pay for about 100 projects now in the early planning stages. To prioritize funding, the act directs FTA to evaluate, rate, and recommend potential new starts projects on the basis of specific financial and project justification criteria. The act also requires FTA to issue regulations for the evaluation and rating process. This report discusses (1) the status of FTA's efforts to develop and implement the evaluation and rating processes and procedures; (2) how FTA implemented the act's requirements for evaluating, rating, and recommending projects; and (3) open issues that FTA needs to resolve to fully satisfy the act's requirements.

GAO noted that: (1) FTA has made substantial progress in developing and implementing a new starts evaluation and rating process, as required by TEA-21; (2) FTA had already revised its new starts evaluation process, since the criteria and most of the factors that TEA-21 requires FTA to consider while applying the criteria were also contained in the Intermodal Surface Transportation Efficiency Act of 1991; (3) in 1997, FTA first applied these criteria for its fiscal year (FY) 1999 project evaluations; (4) in 1998, FTA expanded its evaluation process to include the TEA-21 requirement to rate projects as either highly recommended, recommended, or not recommended and to provide individual ratings on each criterion; (5) the evaluation process FTA followed to prepare its FY 2000 new starts report uses ratings based on specific financial and project justification criteria to build toward an overall project rating; (6) FTA uses this rating information in deciding which projects will receive full funding grant agreements and to make funding recommendations to the Congress in its annual new starts report; (7) while FTA has implemented a new starts evaluation and rating process for FY 2000 that addressed TEA-21 requirements, it has not issued final regulations on the evaluation and rating process, as required by the legislation; and (8) FTA issued a proposed rule on April 7, 1999, and plans to issue final regulations in summer 1999.