Mass Transit

Since the early 1970s, the federal government has provided a large share of the nation's capital investment in urban mass transportation. Much of the investment has come through the Federal Transit Administration's (FTA) New Starts Program. The Transportation Equity Act for the 21st Century authorized billions of dollars in guaranteed funding for New Starts projects through fiscal year 2003. The act requires GAO to report by April 30 of each year on FTA's processes and procedures for evaluating, rating, and recommending New Starts projects for federal funding and on the implementation of these processes and procedures.

GAO noted that: (1) while FTA's FY 2001 New Starts project evaluation and rating process was very similar to the 1999 process, FTA made a number of refinements to the process; (2) for instance, for FY 2001, potential grantees were more strictly assessed on their ability to build and operate a proposed project than in the past; (3) such assessments are meant to ensure that no outstanding issues concerning a project's scope, or cost, or a locality's financial commitment could jeopardize the project once a grant agreement is signed; (4) while FTA has developed an evaluation process that addresses the Transportation Equity Act for the 21st Century's (TEA-21) requirements, final regulations need to be issued to formalize the process; (5) FTA issued a proposed rule on April 7, 1999, and plans to issue final regulations by the summer of 2000; (6) in selecting projects for its FY 2001 New Starts funding proposal, FTA gave first preference to the projects with existing grant agreements; (7) following that, FTA selected from the projects that it had rated as highly recommended or recommended and determined to be ready for grant agreements by the end of FY 2001; (8) of the 48 projects evaluated, 32 were rated as highly recommended or recommended and 15 were recommended for grant agreements; (9) the remaining 17 projects were not recommended for grant agreements for several reasons; (10) according to FTA, 14 of the 17 projects were generally not ready for grant agreements; (11) 3 other projects received highly recommended ratings but were not selected because FTA did not want to fund more than one or two projects in any given geographic area; (12) more state and local transit agencies than ever are competing for New Starts funds; (13) however, the 14 ongoing projects and the 15 additional projects proposed in FY 2001 New Starts report and budget request would consume more than the total New Starts commitment authority provided by TEA-21; and (14) if all of these new grant agreements were executed as proposed, FTA would not be able to commit funds to any more New Starts projects during the last 2 years of TEA-21--through FY 2003.