Public Transportation
Preliminary Information on FTA's Implementation of SAFETEA-LU Changes Gao ID: GAO-06-910T June 27, 2006The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) authorized a significant level of investment--over $52 billion--for federal transit programs. SAFETEA-LU also added new transit programs and made changes to existing programs, including the New Starts and Job Access and Reverse Commute (JARC) programs. The New Starts program is a discretionary grant program for public transportation capital projects. The JARC program is intended to improve the mobility of low-income individuals seeking work. SAFETEA-LU authorized $8.6 billion for these two programs. The Federal Transit Administration (FTA) manages both of these programs. This testimony discusses GAO's preliminary findings on the (1) changes SAFETEA-LU made to the New Starts program, (2) changes SAFETEA-LU made to the JARC program, and (3) issues that may be important as FTA moves forward with implementing the act. To address these objectives, GAO interviewed FTA officials, sponsors of New Starts projects, and representatives from industry associations and reviewed FTA's guidance on the New Starts and JARC programs and federal statutes, among other things.
The changes SAFETEA-LU made to the New Starts program range from establishing the Small Starts program to introducing new evaluation criteria. FTA has taken some initial steps in implementing SAFETEA-LU changes, including issuing an Advanced Notice of Proposed Rule Making (ANPRM) for the Small Starts program and guidance for the New Starts program in January 2006. The Small Starts program is intended to offer small projects an expedited and streamlined application and review process; however, the transit community has questioned whether the Small Starts program, as outlined in the ANPRM, would provide such a process. FTA's guidance for the New Starts program identified and sought public input on possible changes to the program that would affect traditional New Starts projects, or large starts, such as revising the evaluation process to incorporate the new criteria identified by SAFETEA-LU. SAFETEA-LU also made a number of changes to the JARC program. One key change was to change JARC from a discretionary to a formula-based program, which provides funds to states and large urbanized areas for JARC projects. Other SAFETEA-LU changes include allowing JARC recipients to use a portion of funds for planning activities and removing a limit on the amount of funds available for reverse commute projects. To implement these changes, FTA solicited comments and input through public listening sessions and program notices. FTA has released interim guidance for fiscal year 2006, is currently developing draft final guidance for the JARC program, and plans to issue final guidance later this year. GAO's past work suggests that transparency, communication, and accountability issues will be important as FTA moves forward in implementing SAFETEA-LU changes to the New Starts and JARC programs. Since 1998, GAO has issued numerous reports on these programs, and many of the reports contained recommendations to FTA on ways to improve the implementation of these programs. For example, GAO has reported that FTA could increase the transparency of the New Starts program by obtaining public input on proposed policy changes before they are implemented. SAFETEA-LU addressed some of these issues, and FTA has also taken steps to resolve some of them. For example, SAFETEA-LU requires FTA to publish for notice and comment any proposals that make significant changes to the New Starts program. Nevertheless, given the number of changes that are being made to both programs, continued focus on efforts to improve transparency, communication, and accountability will be important. FTA officials provided technical comments on a draft of this testimony, which were incorporated where appropriate.
GAO-06-910T, Public Transportation: Preliminary Information on FTA's Implementation of SAFETEA-LU Changes
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Testimony:
Before the Subcommittee on Housing and Transportation, Committee on
Banking, Housing, and Urban Affairs, U.S. Senate:
United States Government Accountability Office:
GAO:
For Release on Delivery Expected at 2:30 p.m. EDT:
Tuesday, June 27, 2006:
Public Transportation:
Preliminary Information on FTA's Implementation of SAFETEA-LU Changes:
Statement of Katherine Siggerud:
Physical Infrastructure:
GAO-06-910T:
GAO Highlights:
Highlights of GAO-06-910T, a testimony for the Subcommittee on Housing
and Transportation, Committee on Banking, Housing, and Urban Affairs,
U.S. Senate
Why GAO Did This Study:
The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA-LU) authorized a significant level of
investment”over $52 billion”for federal transit programs. SAFETEA-LU
also added new transit programs and made changes to existing programs,
including the New Starts and Job Access and Reverse Commute (JARC)
programs. The New Starts program is a discretionary grant program for
public transportation capital projects. The JARC program is intended to
improve the mobility of low-income individuals seeking work. SAFETEA-LU
authorized $8.6 billion for these two programs. The Federal Transit
Administration (FTA) manages both of these programs.
This testimony discusses GAO‘s preliminary findings on the (1) changes
SAFETEA-LU made to the New Starts program, (2) changes SAFETEA-LU made
to the JARC program, and (3) issues that may be important as FTA moves
forward with implementing the act. To address these objectives, GAO
interviewed FTA officials, sponsors of New Starts projects, and
representatives from industry associations and reviewed FTA‘s guidance
on the New Starts and JARC programs and federal statutes, among other
things.
What GAO Found:
The changes SAFETEA-LU made to the New Starts program range from
establishing the Small Starts program to introducing new evaluation
criteria. FTA has taken some initial steps in implementing SAFETEA-LU
changes, including issuing an Advanced Notice of Proposed Rule Making
(ANPRM) for the Small Starts program and guidance for the New Starts
program in January 2006. The Small Starts program is intended to offer
small projects an expedited and streamlined application and review
process; however, the transit community has questioned whether the
Small Starts program, as outlined in the ANPRM, would provide such a
process. FTA‘s guidance for the New Starts program identified and
sought public input on possible changes to the program that would
affect traditional New Starts projects, or large starts, such as
revising the evaluation process to incorporate the new criteria
identified by SAFETEA-LU.
SAFETEA-LU also made a number of changes to the JARC program. One key
change was to change JARC from a discretionary to a formula-based
program, which provides funds to states and large urbanized areas for
JARC projects. Other SAFETEA-LU changes include allowing JARC
recipients to use a portion of funds for planning activities and
removing a limit on the amount of funds available for reverse commute
projects. To implement these changes, FTA solicited comments and input
through public listening sessions and program notices. FTA has released
interim guidance for fiscal year 2006, is currently developing draft
final guidance for the JARC program, and plans to issue final guidance
later this year.
GAO‘s past work suggests that transparency, communication, and
accountability issues will be important as FTA moves forward in
implementing SAFETEA-LU changes to the New Starts and JARC programs.
Since 1998, GAO has issued numerous reports on these programs, and many
of the reports contained recommendations to FTA on ways to improve the
implementation of these programs. For example, GAO has reported that
FTA could increase the transparency of the New Starts program by
obtaining public input on proposed policy changes before they are
implemented. SAFETEA-LU addressed some of these issues, and FTA has
also taken steps to resolve some of them. For example, SAFETEA-LU
requires FTA to publish for notice and comment any proposals that make
significant changes to the New Starts program. Nevertheless, given the
number of changes that are being made to both programs, continued focus
on efforts to improve transparency, communication, and accountability
will be important.
FTA officials provided technical comments on a draft of this testimony,
which were incorporated where appropriate.
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-910T].
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Katherine Siggerud at
(202) 512-2834 or siggerudk@gao.gov.
[End of Section]
Mr. Chairman and Members of the Subcommittee:
We appreciate the opportunity to provide testimony on the Federal
Transit Administration's (FTA) implementation of the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU). As you know, SAFETEA-LU authorized a significant level of
investment--over $52 billion--for federal transit programs. This
authorization provides funding for fiscal years 2004 through 2009, adds
new transit programs, and makes changes to existing programs, including
the New Starts and Job Access and Reverse Commute (JARC) programs. The
New Starts program provides much of the federal government's share of
new fixed-guideway investments. Through the New Starts program, FTA
identifies and selects new fixed-guideway transit projects for funding-
-including heavy, light, and commuter rail; ferry; and certain bus
projects. The JARC program is intended to assist low-income individuals
in accessing employment opportunities by attempting to fill gaps in
public transportation services.
My testimony today examines the (1) changes SAFETEA-LU made to the New
Starts program, (2) changes SAFETEA-LU made to the JARC program, and
(3) issues that may be important as FTA moves forward with implementing
the act. My comments are based on our ongoing work for the Senate
Committee on Banking, Housing, and Urban Affairs and the House
Committee on Transportation and Infrastructure as well as our body of
work on the New Starts and JARC programs.[Footnote 1] We will complete
our ongoing work and report in full to the Committees later this year.
For our ongoing work, we interviewed FTA officials, sponsors of New
Starts projects, a metropolitan planning organization, and
representatives from industry associations. We also reviewed FTA's
guidance on the New Starts and JARC programs, the Advanced Notice of
Proposed Rule Making (ANPRM) for the new capital investment program for
Small Starts--a subcategory of new fixed guideway projects--and the
public comments submitted to FTA's docket on these documents. We also
reviewed the provisions of SAFETEA-LU and of its predecessor, the
Transportation Equity Act for the 21st Century (TEA-21), dealing with
the New Starts and JARC programs, and attended FTA's New Starts/Small
Starts Seminar and Listening Sessions in March and June 2006. We
conducted our work from February 2006 through June 2006 in accordance
with generally accepted government auditing standards.
In summary:
² The eight changes SAFETEA-LU made to the New Starts program range
from establishing the Small Starts program to identifying new
evaluation criteria. FTA has taken some initial steps to implement
these changes, including issuing an ANPRM for the Small Starts program
and guidance for the New Starts program, both in January 2006. The
Small Starts program is a new component of the New Starts program and
is intended to offer an expedited and streamlined application and
review process for small projects. The transit community, however,
questioned whether the Small Starts program, as outlined in the ANPRM,
would provide such a process. In its January 2006 guidance, FTA also
identified and sought public input on possible changes to the New
Starts program that would have an impact on traditional New Starts
projects, or large starts, such as revising the evaluation process to
incorporate the new criteria identified by SAFETEA-LU. According to
FTA, a potential challenge in moving forward is incorporating both land
use and economic development criteria into the evaluation process,
including developing appropriate measures for the criteria and avoiding
duplication in counting benefits. To address this issue, FTA suggested
combining land use and economic development into a single measure.
However, in the comments submitted to FTA, members of the transit
community repeatedly stated that land use and economic development
should not be combined into a single measure and that they should
receive the same weight as cost-effectiveness in the evaluation and
rating process.
² SAFETEA-LU made a number of changes to the JARC program. One key
change was to change JARC from a discretionary to a formula-based
program. Whereas funds for JARC projects were congressionally
designated in recent years, SAFETEA-LU's formula distributes funds to
states and large urbanized areas.[Footnote 2] This will significantly
change the allocation of JARC funds as some states and urbanized areas
receive more funds than under the discretionary program, others receive
less, and some areas will receive funds that had not received JARC
funds in the past. Other key changes resulting from SAFETEA-LU include
allowing JARC recipients to use a portion of funds for planning
activities and removing a limit on the amount of funds available for
reverse commute projects. To implement these changes, FTA began
soliciting comments and input through public listening sessions and
program notices in November 2005. FTA has released interim guidance for
fiscal year 2006, is currently developing draft final guidance for the
JARC program, and plans to issue final guidance later this year.
Potential challenges that FTA faces in moving forward include issuing
guidance in a timely manner so that recipients can implement JARC
programs, and determining how to incorporate JARC recipients into FTA's
oversight processes.
² Our past work suggests that transparency, communication, and
accountability issues will be important as FTA moves forward in
implementing SAFETEA-LU changes to the New Starts and JARC programs.
Since 1998, we have issued numerous reports on these programs, and many
of the reports contained recommendations to FTA on ways to improve the
programs' implementation. For example, we have reported that FTA could
increase the transparency of the New Starts program by obtaining public
input on proposed policy changes before they are implemented. We have
also reported that FTA could better measure the outcomes of the JARC
program--an important step in holding the program accountable for
results. SAFETEA-LU addressed some of these issues, and FTA has also
taken steps to resolve some of them. For example, SAFETEA-LU requires
FTA to publish for notice and comment any proposals that make
significant changes to the New Starts program, which FTA did in January
2006. Members of the transit community and FTA officials have stated
that they have been pleased with the review and comment process.
Nevertheless, given the number of changes that are being made to both
programs, continued focus on efforts to improve transparency,
communication, and accountability will be important.
Background:
SAFETEA-LU authorized over $52 billion for federal transit programs,
including the New Starts and JARC programs, from fiscal year 2005
through fiscal year 2009. SAFETEA-LU authorized $7.9 billion for the
New Starts program and $727 million for the JARC program. Both of these
programs are managed by FTA.
The New Starts program is a discretionary grant program for investments
in new fixed-guideway projects. Under the statutorily-defined
evaluation process for the New Starts program, FTA identifies and
selects fixed-guideway transit projects--including heavy, light, and
commuter rail; ferry; and busway projects--for funding. FTA generally
funds New Starts projects through full funding grant agreements (FFGA),
which establish the terms and conditions for federal participation in a
New Starts project and also define a project's scope, including the
length of the system and the number of stations; the project's
schedule, including the date when the system is expected to open for
service; and the project's cost. To obtain an FFGA, a project must
progress through a local or regional review of alternatives and meet a
number of federal requirements, including providing information for the
New Starts evaluation and rating process. As required by SAFETEA-LU,
New Starts projects must emerge from a regional, multimodal
transportation planning process. The first two phases of the New Starts
process--systems planning and alternatives analysis--address this
requirement. The systems planning phase identifies the transportation
needs of a region, while the alternatives analysis phase provides
information on the benefits, costs, and impacts of different corridor-
level options, such as rail lines or bus routes. The alternatives
analysis phase results in the selection of a locally preferred
alternative--which is intended to be the New Starts project that FTA
evaluates, as required by statute. After a locally preferred
alternative is selected, project sponsors seek FTA's approval for entry
into the preliminary engineering phase.[Footnote 3] Following
completion of preliminary engineering and federal environmental
requirements--and assuming New Starts requirements continue to be met-
-FTA may approve the project's advancement into final design,[Footnote
4] after which FTA may approve the project for an FFGA and proceed to
construction, as provided for in statute. FTA oversees grantees'
management of projects from the preliminary engineering phase through
construction and evaluates the projects for advancement into each phase
of the process, as well as annually for the New Starts report to
Congress.
To help inform administration and congressional decisions about which
projects should receive federal funds, FTA assigns ratings based on a
variety of financial and project justification criteria, and then
assigns an overall rating. For the fiscal year 2007 evaluation cycle,
FTA used the financial and project justification criteria identified in
TEA-21.[Footnote 5] These criteria reflect a broad range of benefits
and effects of the proposed project, such as cost-effectiveness, as
well as the ability of the project sponsor to fund the project and
finance the continued operation of its transit system (see fig. 1). FTA
assigns the proposed project a rating for each criterion, then assigns
a summary rating for local financial commitment and project
justification. Finally, FTA develops an overall project rating.
Projects are rated at several points during the New Starts process--as
part of the evaluation for entry into preliminary engineering and final
design, and yearly for inclusion in the New Starts annual report that
is submitted to Congress.
Figure 1: New Starts Evaluation Process:
[See PDF for image]
Source: GAO analysis of FTA data.
[End of figure]
More recent than New Starts, the JARC program was created in 1998 in
order to support the nation's welfare reform goals. Without adequate
transportation, welfare recipients face significant barriers in moving
from welfare to work. In 1998, we reported that three-fourths of
welfare recipients live in central cities or rural areas, while two-
thirds of new entry-level jobs are located in suburbs. Public
transportation facilities often offer limited or no access to many of
these jobs.[Footnote 6] JARC, which is administered by FTA, was
designed to fill these gaps in transportation services for low-income
individuals.
JARC is intended to increase collaboration among transit agencies,
local human service agencies, nonprofit organizations, and others and
to improve the mobility of low-income individuals seeking work.
Programs selected to receive grants--including the expansion of public
transportation routes, ridesharing activities, and promotion of transit
voucher programs--are designed to assist low-income individuals in
accessing employment opportunities and related services, such as child
care and training.
SAFETEA-LU's Changes to the New Starts Program Range from Identifying
New Evaluation Criteria to Establishing the Small Starts Program:
SAFETEA-LU made changes to the New Starts program that range from
identifying new evaluation criteria to establishing the Small Starts
program. FTA has taken some initial steps in implementing these
changes, including issuing an ANPRM for the Small Starts program and
guidance for the New Starts program, both in January 2006. The Small
Starts program is a new component of the New Starts program and is
intended to expedite and streamline the application and review process
for small projects. The transit community, however, questioned whether
the program, as outlined in the ANPRM, would streamline the process. In
its January 2006 guidance, FTA also identified and sought public input
on possible changes to the New Starts program that would affect
traditional New Starts projects, or large starts, such as revising the
evaluation process to incorporate the new evaluation criteria
identified by SAFETEA-LU. FTA also identified possible implementation
challenges, including how to distinguish between land use and economic
development criteria in the evaluation framework.
FTA Has Started to Implement SAFETEA-LU Changes and Will Continue to Do
So through the Rulemaking Process:
SAFETEA-LU introduced eight changes to the New Starts program, codified
an existing practice, and clarified federal funding requirements. These
changes range from the creation of the Small Starts program to
introducing new evaluation criteria. For example, SAFETEA-LU added
economic development to the list of criteria that FTA must use in the
New Starts evaluation process. In addition, SAFETEA-LU codified FTA's
requirement that project sponsors conduct before and after studies for
all completed projects.[Footnote 7] SAFETEA-LU also clarified the
federal share requirements for New Starts projects. In particular,
SAFETEA-LU states that the federal share for a New Starts project may
be up to 80 percent of the project's net capital project cost, unless
the project sponsor requests a lower amount. SAFETEA-LU also prohibits
the Secretary of Transportation from requiring a nonfederal share of
more than 20 percent of the project's total net capital cost. This
language addresses FTA's policy of favoring projects that seek a
federal New Starts share of no more than 60 percent of the total cost.
FTA instituted this policy beginning with the fiscal year 2004
evaluation cycle in response to language contained in appropriation
committee reports. Table 1 describes SAFETEA-LU provisions for the New
Starts program and compares them to TEA-21's requirements.
Table 1: Comparison of SAFETEA-LU's and TEA-21's New Starts Provisions:
Provisions: Establish the Small Starts;
SAFETEA-LU:
* Projects seeking less than $25 million in New Starts funds will no
longer be exempt from the ratings process once the Small Starts final
rule is issued:
* Establishes a new capital investment program called Small Starts that
(1) are corridor based, (2) have a total project cost of less than $250
million, and (3) are seeking less than $75 million in federal Small
Start funding;
TEA-21:
* Projects seeking less than $25 million in New Starts funding were
exempt from the ratings process:
* No separate program for small transit projects.
Provisions: Codify the before and after study requirement;
SAFETEA-LU: Project sponsors with FFGAs must conduct a study that (1)
describes and analyzes the impacts of the new fixed guideway capital
project on transit services and transit ridership, (2) evaluates the
consistency of predicted and actual project characteristics and
performance, and (3) identifies sources of differences between
predicted and actual outcomes. Project sponsors must prepare an
information collection and analysis plan, which must e approved prior
to execution of the FFGA;
TEA-21: Not required under TEA-21, but FTA required project sponsors to
conduct a before and after study on completed projects.
Provisions: Revise New Starts overall project rating scale;
SAFETEA-LU: Overall project rating is based on a 5-point scale of
"high," "medium-high," "medium," "medium-low," and "low." Projects are
required to receive a rating of "medium" or higher to be recommended
for funding;
TEA-21: Overall project rating was based on 3-point scale: "highly
recommended," recommended," and "not recommended".
Provisions: Identify reliability of cost estimate and ridership
forecast as a consideration in evaluation;
SAFETEA-LU: Requires Secretary to analyze, evaluate, and consider the
reliability of the forecasting methods used by New Starts project
sponsors and their contractors to estimate costs and ridership;
TEA-21: Not required under TEA-21.
Provisions: Add economic development criterion to evaluation process;
SAFETEA-LU: Projects will be evaluated based on a review of their
effects on local economic development;
TEA-21: Not required under TEA-21.
Provisions: Identify land use as a specific evaluation criterion;
SAFETEA-LU: Projects will be evaluated based on a review of their
public transportation supportive land use policies and future patterns;
TEA-21: Land use was not identified as an evaluation criterion by TEA-
21. However, TEA-21 identified lad use as a "consideration" in the
evaluation process and FTA incorporated it into the evaluation process.
Provisions: Clarify nonfederal financial commitment;
SAFETEA-LU: The Secretary is not authorized to require a nonfederal
financial commitment for a project that is more than 29 percent of its
net capital cost;
TEA-21: Federal share could not exceed 80 percent. But, in response to
language contained in appropriations committee reports, FTA instituted
a preference policy favoring projects that seek a federal New Starts
share of no more than 60 percent of the total project cost beginning
with the fiscal year 2004 evaluation cycle.
Provisions: Establish incentives for accurate cost and ridership
forecasts;
SAFETEA-LU: A higher share of New Starts funding may be made available
to project sponsors if project's cost is not more than 10 percent
higher and ridership is not less than 90 percent of those estimates
when project was approved for preliminary engineering;
TEA-21: No similar provision for TEA-21.
Provisions: Require FTA to publish policy guidance;
SAFETEA-LU: New Starts policy guidance must be published for notice and
comment no later than 120 days after the enactment of SAFETEA-LU, each
time significant changes are made, and at least every 2 years;
TEA-21: No required for TEA-21.
Provisions: Assess contractors' performance;
SAFETEA-LU: The Secretary will submit an annual report to congressional
committees analyzing the consistency and accuracy of cost and ridership
estimates made by contractors to public transportation agencies
developing new capital projects;
TEA-21: Not required under TEA-21.
Source: GAO analysis of SAFETEA-LU and TEA-21.
[End of Table]
FTA has taken some initial steps in implementing SAFETEA-LU changes.
For example, in January 2006, FTA published the New Starts policy
guidance and, as will be discussed later, the ANPRM for the Small
Starts program. FTA will continue to implement the changes outlined in
SAFETEA-LU through the rulemaking process over the next year and a
half. Specifically, in response to SAFETEA-LU changes, FTA is
developing a Notice of Proposed Rulemaking (NPRM) for the New Starts
and Small Starts programs. FTA plans to issue the NPRM in January 2007,
with the goal of implementing the final rule in January 2008. Figure 2
shows a time line of FTA's actual and planned implementation of SAFETEA-
LU changes.
Figure 2: Time Line for Implementing SAFETEA-LU Changes to the New
Starts Program:
[See PDF for image]
Source: GAO.
[End of figure]
Small Starts Program Is Intended to Offer a Streamlined Process, but
Transit Community Members Question Whether It Will Do So:
A significant SAFETEA-LU change was the creation of the Small Starts
program. The Small Starts program is a discretionary grant program for
public transportation capital projects that (1) are corridor-based, (2)
have a total cost of less than $250 million, and (3) are seeking less
than $75 million in federal Small Starts program funding. The Small
Starts program is a component of the existing New Starts program, but,
according to the conference reports accompanying SAFETEA-LU, is
intended to provide project sponsors with an expedited and streamlined
evaluation and rating process. Table 2 compares New Starts and Small
Starts program requirements.
Table 2: Comparison of New Starts and Small Starts Program
Requirements:
Program requirements: Definition of eligibility;
New Starts: Total project is $250 million or more, or $75 million or
more in federal New Starts funding is sought. Provides funding for new
fixed guideway systems and extensions;
Small Starts: Total project cost is less than $250 million, and less
than $ 75 million in federal New Starts funding is sought. Provides
funding for new fixed guideway systems and extensions, as well as
corridor-based bus capital projects.
Program requirements: Project justification criteria;
New Starts:
* Mobility improvements:
* Environmental benefit:
* Operating efficiencies:
* Cost-effectiveness:
* Public transportation supportive land use policies:
* Economic development:
* Reliability of forecasting;
Small Starts:
* Cost-effectiveness (based on opening year of service):
* Public transportation supportive land use policies:
* Economic development:
* Reliability of forecasting.
Program requirements: Local financial commitment criteria;
New Starts:
* Stability and reliability of financial plan for capital costs:
* Stability and reliability of financial plan for operating and
maintenance costs:
* Level of non-New Starts funding;
Small Starts:
* Stability and reliability of financial plan for capital costs:
* Stability and reliability of financial plan for operating and
maintenance costs:
* Level of non-New Starts funding.
Program requirements: Project development process;
New Starts:
* Alternatives analysis:
* Preliminary engineering:
* Final design:
* Construction;
Small Starts:
* Alternatives analysis:
* Project development:
* Construction.
Program requirements: Funding instrument;
New Starts: Projects are required to sign an FFGA, which sets scope,
cost, and schedule, as well as maximum New Starts share source of other
funds, and schedule for obligating funds;
Small Starts: Project will use a Project Construction Grant Agreement,
which will be a streamlined version of the FFGA.
Source: GAO analysis of New Starts and Small Starts requirements.
[End of Table]
In January 2006, FTA published an ANPRM to give interested parties an
opportunity to comment on the characteristics of and requirements for
the Small Starts program. In its ANPRM, FTA suggests that the planning
and project development process for proposed Small Starts projects
could be simplified by allowing analyses of fewer alternatives for
small projects, allowing the development of evaluation measures for
mobility and cost-effectiveness without the use of complicated travel
demand modeling procedures in some cases, and possibly defining some
classes of pre-approved low-cost improvements as effective and cost-
effective in certain contexts. FTA also sought the transit community's
input on three key issues in its ANPRM, including eligibility, the
rating and evaluation process, and the project development process. For
each of these issues, FTA outlined different options for how to
proceed, and then posed a series of questions for public comment,
including the following questions on the rating and evaluation process:
² How should the evaluation framework for New Starts be changed or
adapted for Small Starts projects?
² How might FTA evaluate economic development and land use as distinct
and separate measures?
² How might FTA incorporate risk and uncertainty into project
evaluations for Small Starts?
² What weights should FTA apply to each measure?
FTA's ANPRM for Small Starts generated a significant volume of public
comment. While members of the transit community were supportive of some
proposals for the Small Starts program, they also had a number of
concerns. In particular, the transit community questioned whether FTA's
proposals would, as intended, provide smaller projects with a more
streamlined evaluation and rating process. As a result, some commenters
recommended that FTA simplify some of its original proposals in the
final NPRM to reflect the smaller scope of these projects. For example,
several project sponsors and industry representatives thought that FTA
should redefine the baseline alternative as the "no-build"
option[Footnote 8] and make the before and after study optional for
Small Starts projects to limit the time and cost of project
development. In addition, others were concerned that FTA's proposals
minimized the importance of the new land use and economic development
evaluation criteria introduced by SAFETEA-LU, and they recommended that
the measures for land use and economic development be revised.
Since FTA does not plan to issue its final rule for the New Starts and
Small Starts programs until early 2008, FTA issued proposed interim
guidance for the Small Starts program in June 2006 to ensure that
project sponsors would have an opportunity to apply for Small Starts
funding and be evaluated in the upcoming cycle (i.e., the fiscal year
2008 evaluation cycle, which begins in August 2006). The proposed
interim guidance describes the process that FTA will use to evaluate
proposed Small Starts projects to support the decision to approve or
disapprove their advancement to project development and the decision to
recommend projects for funding, including whether proposed projects are
part of a broader strategy to reduce congestion in particular regions.
In addition, although not required by SAFETEA-LU, FTA introduced a
separate eligibility category within the Small Starts program for "Very
Small Starts" projects in the proposed interim guidance. Small Starts
projects that qualify as Very Small Starts are projects that:
² do not include the construction of a new fixed guideway,
² are in corridors with existing riders who will benefit from the
proposed project and number more than 3,000 on an average weekday,
including at least 1,000 riders who board at the terminal stations,
and:
² have a total capital cost of less than $50 million and less than $3
million per mile (excluding rolling stock).
According to the proposed interim guidance on the Small Starts program,
FTA intends to scale the planning and project development process to
the size and complexity of the proposed projects. Therefore, Very Small
Starts projects will undergo a very simple and streamlined evaluation
and rating process. Small Starts projects that do not meet all three
criteria for Very Small Starts projects will be evaluated and rated
using a framework similar to that used for traditional, or large
starts, New Starts projects. However, FTA officials have indicated that
this evaluation and rating framework would be modified, for example, to
include only those criteria listed in the statute. FTA is seeking
public input on the Small Starts proposals contained in the proposed
interim guidance through July 9, 2006. FTA plans to review the comments
received and issue its final interim guidance for the Small Starts
program by August 2006. This guidance will govern the program until the
final rule is issued.
FTA Also Identified Possible Changes to the New Starts Program in
Response to SAFETEA-LU as well as Implementation Challenges:
In response to SAFETEA-LU, FTA identified possible changes to the New
Starts program that would affect traditional New Starts projects, or
large starts, in its January 2006 guidance. According to FTA, some of
SAFETEA-LU provisions could lead to changes in the definition of
eligibility, the evaluation and rating process, and the project
development process. In the guidance, FTA outlines changes it is
considering and solicits public input, through a series of questions,
on the potential changes. For example, FTA identified two options for
revising the evaluation and rating process to reflect SAFETEA-LU's
changes to the evaluation criteria. The first option would extend the
current process to include economic development impacts and the
reliability of cost and ridership forecasts. Specifically, FTA
suggested that economic development impacts and the reliability of
forecasts simply be added to the list of criteria considered in
developing the project justification rating. The second option would be
to develop a broader process to include the evaluation criteria
identified by SAFETEA-LU and to organize the measures to support a more
analytical discussion of the project and its merits. According to FTA,
the second option would broaden the evaluation process beyond a
computation of overall ratings based on individual evaluation measures
and develop better insights into the merit of a project than are
possible from using the quantified evaluation measures alone. (See app.
I for a description of the different changes FTA is considering.)
FTA also identified potential challenges in implementing some of
SAFETEA-LU changes in its guidance. In particular, FTA described the
challenges of incorporating and distinguishing between two measures of
indirect benefits[Footnote 9] in the New Starts evaluation process--
land use and economic development impacts.[Footnote 10] For example,
FTA noted that its current land use measures (e.g., land use plans and
policies) indicate the transit-friendliness of a project corridor both
now and in the future, but they do not measure the benefits generated
by the proposed project. Rather, they describe the degree to which the
project corridor provides an environment in which the proposed project
can succeed. According to FTA's guidance, FTA's evaluation of land use
does not include economic development benefits because FTA has not been
able to find reliable methods of predicting these benefits. FTA further
stated that because SAFETEA-LU introduces a separate economic
development criterion, the potential role for land use as a measure of
development benefits becomes even less clear given its potential
overlap with the economic development criterion. In addition, FTA noted
that many economic development benefits result from direct benefits
(e.g., travel time savings), and therefore, including them in the
evaluation could lead to double counting the benefits FTA already
measures and uses to evaluate projects. Furthermore, FTA noted that
some economic development impacts may represent transfers between
regions rather than a net benefit for the nation,[Footnote 11] raising
questions as to whether these impacts are useful for a national
comparison of projects. To address some of the challenges, FTA
suggested that an appropriate strategy might be to combine land use and
economic development into a single measure.
We have also reported on many of the same challenges of measuring and
forecasting indirect benefits, such as economic development and land
use impacts.[Footnote 12] For example, we noted that it is challenging
to predict changes in land use because current transportation demand
models are unable to predict the effect of a transportation investment
on land-use patterns and development, since these models use land-use-
forecasts as inputs into the model. In addition, we noted that certain
benefits are often double counted when evaluating transportation
projects. In particular, indirect benefits, such as economic
development, may be more correctly considered transfers of direct user
benefits or economic activity from one area to another. Therefore,
estimating and adding such benefits to direct benefits could constitute
double counting and lead to overestimating a project's benefits.
Despite these challenges, experts told us that evaluating land use and
economic development impacts is important, since they often drive local
transportation investment choices.
FTA received a large number of written comments on its online docket in
response to its proposed changes. (See app. I for common comments
submitted for each proposed change.) While members of the transit
community were supportive of some proposals, they expressed concerns
about a number of FTA's proposed changes. For example, a number of
commenters expressed concerns about FTA's options for revising the
evaluation process, noting that both proposals deemphasized the
importance of economic development and land use. Some commenters also
noted that land use and economic development should not be combined
into a single measure and that they should receive the same weight as
cost-effectiveness in the evaluation and rating process.
SAFETEA-LU Transformed the JARC Program from a Discretionary to a
Formula-based Program:
SAFETEA-LU made a number of changes to the JARC program, the most
notable of which was the creation of a formula to distribute JARC
funds. Whereas funds for JARC projects were congressionally designated
in recent years, SAFETEA-LU's formula distributes funds to states and
large urbanized areas. This is a significant change because some states
and urbanized areas will receive substantially more funds than under
the discretionary program, while others will receive substantially
less. In addition, the formula program will result in some areas
receiving JARC funds that had not received them in the past. Other JARC
changes resulting from SAFETEA-LU include the ability to use a portion
of JARC funds for planning activities and the removal of a restriction
on the JARC funding available for reverse commute projects, which are
designed to help individuals in urban areas access suburban employment
opportunities. FTA has worked to develop guidance to help JARC
recipients implement these changes by soliciting comments and input
through program notices and listening sessions beginning in November
2005. FTA issued interim JARC guidance in March 2006 and is currently
working to develop draft final guidance for the program.[Footnote 13]
Final guidance for JARC is expected later this year. Two potential
challenges for FTA as it moves forward will be to issue final JARC
guidance in a timely manner and to determine its plan for oversight of
the JARC program.
SAFETEA-LU Created a Formula for Distributing JARC Funds and Amended
Other Key Aspects of the Program:
A key SAFETEA-LU change to the JARC program was the creation of a
formula to distribute JARC funds. Under TEA-21, JARC was a
discretionary grant program for which FTA competitively selected JARC
projects and, more recently, awarded funds for congressionally
designated projects. Under SAFETEA-LU, states and large urbanized areas
have been apportioned funding for JARC projects through a formula based
on the number of low-income individuals and welfare recipients in each
area.[Footnote 14] This is a significant change because some states and
urbanized areas will receive substantially more funds than under the
discretionary program, while others will receive substantially less. In
addition, the formula program will result in some areas receiving JARC
funds that had not received them in the past. Forty percent of JARC
funds each year are required to be apportioned among states for
projects in small urbanized and other than urbanized areas, and the
remaining 60 percent are required to be apportioned among urbanized
areas with a population of 200,000 or more.[Footnote 15] The governor
of each state must designate a recipient for JARC funds at the state
level to competitively select and award funds for projects in small
urbanized and other than urbanized areas within the state. In large
urbanized areas, the recipient must be designated by the governor,
local officials, and publicly owned operators of public transportation.
In addition to creating a formula for distributing JARC funds, SAFETEA-
LU also extended a JARC requirement related to coordinated planning to
additional FTA programs and made a number of other changes to key
aspects of the JARC program. In the past, JARC projects were required
to be part of a coordinated public transit-human services
transportation plan; a similar requirement is included in SAFETEA-LU.
However, this requirement will apply in fiscal year 2007 to two other
FTA programs that provide funding for transportation-disadvantaged
populations.[Footnote 16] In addition, recipients in states and
urbanized areas that select JARC projects must now certify that their
selections were based on this plan. Another change resulting from
SAFETEA-LU is the ability of a recipient to use up to 10 percent of its
JARC allocation for administration, planning, and technical
assistance,[Footnote 17] and the expansion of the definition of
eligible activities to include planning as well as capital and
operating activities. SAFETEA-LU also removed a restriction on the
amount of funding available for reverse commute projects to help
individuals in urban areas gain access to suburban employment
opportunities. Table 3 compares key JARC provisions under SAFETEA-LU
and TEA-21.
Table 3: Comparison of SAFETEA-LU's and TEA-21's JARC Provisions:
[See PDF for image]
Source: GAO analysis of TEA-21 and SAFETEA-LU.
[A] Eligible low-income individuals are those whose family income is at
or below 150 percent of the poverty line.
[B] FTA programs in addition to JARC that serve these populations are
the Elderly Individuals and Individuals with Disabilities program and
the New Freedom program.
[C] Metropolitan planning organizations are federally mandated regional
organizations responsible for comprehensive transportation planning and
programming in urbanized areas.
[D] FTA allowed JARC grantees to use up to 10 percent for
administration and technical assistance activities.
[End of table]
Some of these changes address issues that we have raised in past
reports on JARC and the coordination of transportation services for
transportation-disadvantaged populations.[Footnote 18] For example, in
2004 we reported that a majority of the JARC grantees we spoke with
supported a proposal to use grant funds for administrative, planning,
and technical assistance activities, because these activities could
increase coordination with potential partners. In 2003, we also
reported that some federal and state officials believed that providing
financial incentives or mandates for coordination was one way to
improve the coordination of transportation services among federal
programs. In addition, officials of one metropolitan planning
organization that we spoke to about changes to the JARC program also
note that the change to a formula program may better facilitate
cooperation between organizations. They explained that the required
coordinated plans for JARC projects became irrelevant in the past when
JARC funds were congressionally designated.
FTA Has Developed Interim JARC Guidance and Plans to Issue Final
Program Guidance Later This Year:
FTA has been working to develop guidance to help JARC recipients
implement changes to the program. In November 2005, FTA published a
notice of changes for FTA programs, including JARC. This notice
provided information on the JARC program and solicited public comment
on aspects of the program such as technical assistance needs and the
coordinated planning process. FTA also held five public listening
sessions across the country in December 2005 on a number of programs,
including JARC, to obtain comments and input on the questions and
issues that should be included in future guidance. In March 2006,
drawing on the information FTA received through comments and the
listening sessions, it released interim JARC guidance for fiscal year
2006 and proposed strategies for fiscal year 2007, and sought comments
to assist in the development of program guidance.[Footnote 19] FTA
received more than 200 comments on this notice, and the comments
addressed a variety of issues, including the coordinated planning
requirement for JARC and other programs and the selection of designated
recipients. For example, several private operators of transportation
services have requested that FTA include language that private
transportation operators be involved in the coordinated planning
process. A number of comments have also addressed whether there would
be a potential conflict of interest in having a provider of
transportation services also serve as the designated recipient that
will select JARC projects for funding. FTA officials have indicated
that they plan to address many of the issues raised in the comments in
draft final guidance for JARC that they plan to release later this
summer. FTA plans to solicit comments on the draft final guidance and
issue final guidance for JARC later this year. Figure 3 presents a time
line for FTA's implementation of changes to the JARC program.
Figure 3: Time Line for FTA's Implementation of SAFETEA-LU Changes to
the JARC Program:
[See PDF for image]
Source: GAO.
[End of figure]
Through our preliminary work, we have identified two challenges that
FTA may encounter as it moves forward in its implementation of changes
to JARC. One potential challenge for FTA will be to ensure that it
develops JARC guidance in a timely manner so that JARC recipients can
implement the program. Officials from one metropolitan planning
organization we spoke with about JARC changes noted that the guidance
will be important because it will address questions that JARC
recipients have raised about the program's implementation and to which
they have received conflicting answers from FTA headquarters and
regional staff. A publicly available schedule of FTA deliverables
related to SAFETEA-LU's implementation stated that draft final guidance
for JARC was anticipated between May and July 2006. However, FTA
officials told us that they now expect to issue the draft final
guidance in late July or early August. This change reflects FTA's
extension of the comment period for the March 2006 notice by 1 month to
receive additional comments, and the submission of more than 100
comments on or after the last day of the comment period. The additional
comments raised a number of issues for FTA to consider, according to
FTA officials. While FTA has stated that criteria in the final guidance
will not apply retroactively to issued grants so that areas can proceed
with JARC projects, FTA officials as well as officials from an
association that represents metropolitan planning organizations have
told us that some recipients of JARC funds will likely wait for final
program guidance before proceeding. In addition, few states and
urbanized areas have taken formal steps to apply for fiscal year 2006
funds. As of late May, 5 states had notified FTA of their designated
recipient for JARC funding, and 1 of the 152 urbanized areas that
receive a JARC apportionment had obligated fiscal year 2006 JARC funds,
according to FTA officials.
Another potential challenge for FTA in moving forward will be to
determine its plan for overseeing the JARC program. FTA officials have
told us that they are still developing this plan, and that at a minimum
they expect to use routine grant management tools--such as progress
reports and site visits--to oversee JARC recipients. In its interim
guidance, FTA also indicates that it intends to use existing oversight
mechanisms from the federal urbanized area and nonurbanized area
formula programs, such as triennial reviews and state management
reviews. However, FTA officials acknowledge they need to determine how
to incorporate JARC grant recipients into these oversight processes.
Transparency, Communication, and Accountability Issues Will Continue to
Be Important:
Our past work suggests that transparency, communication, and
accountability issues will be important as FTA moves forward in
implementing SAFETEA-LU changes to the New Starts and JARC programs.
Like SAFETEA-LU, TEA-21 required GAO to regularly review the New Starts
and JARC programs. Since 1998, we have issued numerous reports on these
programs, and many of the reports contained recommendations to FTA on
ways to improve the implementation of these programs. SAFETEA-LU
addressed some of these issues, and FTA has also taken steps to resolve
some of them. Nevertheless, given the number of changes that are being
made to both programs, continued focus on improving transparency,
communication, and accountability will be important.
In our recent reports on the New Starts program, we noted several cases
in which FTA could have improved the program's transparency. Typically,
these cases dealt with FTA's decisions not to seek public input on
proposed policy changes before they were implemented. In our 2005
report, we found that FTA had made 16 changes to the New Starts process
since fiscal year 2001, but had not published information about the
changes in the Federal Register or instituted a rulemaking process for
9 of the changes; moreover, for 6 of the 9 changes, FTA did not provide
any avenues for public review and comment.[Footnote 20] For example,
during the fiscal year 2004 cycle, FTA instituted a preference policy
in its ratings process favoring current and future projects that do not
request more than a 60 percent federal funding share. However, FTA did
not amend its regulations to reflect this change in policy or its
existing procedures, and the public did not have an opportunity to
comment on the impact of the change prior to its adoption.
SAFETEA-LU addressed our past concerns about the transparency of the
New Starts program by requiring FTA to publish for notice and comment
any proposals that make significant changes to the New Starts program.
FTA has already implemented this requirement. For instance, earlier
this year, FTA gave the transit community an opportunity to review and
comment on proposed procedural changes (i.e., nonregulatory changes) to
the New Starts process as well as possible changes FTA was considering
for the New Starts program in the future. Although members of the
transit community expressed concerns about some of FTA's proposed
changes in their comments, project sponsors and industry
representatives repeatedly told us that they appreciated the
opportunity to review and comment on the proposals. FTA officials have
also stated that they have been pleased with the review and comment
process, noting that it helps to ensure that FTA's guidance is more
complete, more responsive to stakeholders' needs, and more likely to
take into account on-the-ground realities.
We have also previously reported shortfalls in FTA's communication of
New Starts program changes to project sponsors that in several cases,
have resulted in implementation problems. For example, in our 2003
report,[Footnote 21] we noted that a number of project sponsors were
unable to calculate a valid Transportation System User Benefits (TSUB)
value, and as a result, their projects received a "not rated" rating
for the cost-effectiveness criterion.[Footnote 22] Project sponsors
commented that they would have benefited from additional guidance and
technical support on how to generate the required data for the TSUB
measure. Similarly, during the fiscal year 2005 evaluation cycle, FTA
introduced a requirement for project sponsors to submit a "make the
case" document to articulate the benefits of a proposed New Starts
project. FTA officials intended to use the document to help interpret
data produced by the local travel forecasting models, but FTA did not
prepare any written guidance on what information to include or provide
report templates. Without such information, project sponsors stated
that they did not understand what should be included in the document or
how it would be used, and FTA officials later acknowledged that many of
the submissions did not meet their expectations.
SAFETEA-LU addressed these communication problems by requiring that FTA
routinely publish policy guidance. Specifically, SAFETEA-LU requires
that FTA publish policy guidance for comment and response no later than
120 days after the enactment of SAFETEA-LU, each time significant
changes are made, and at least every 2 years. FTA responded to this
requirement by publishing policy guidance for the New Starts program in
January 2006 and soliciting public comments on the proposed changes
outlined in the guidance. Furthermore, in its January guidance, FTA
included possible long-term changes to the large starts component of
the New Starts program that FTA is considering. FTA stated that it
hoped to use the policy guidance as a forum for discussing possible
changes with the transit community so that FTA could take the
community's comments into account when developing the NPRM for the New
Starts program. In addition, FTA held multiple listening sessions
across the country, during which officials told project sponsors about
proposed changes to the New Starts program and their rationale for
implementing these changes. Most of the project sponsors and industry
representatives we interviewed told us that they appreciated FTA's
efforts to solicit their feedback and to encourage an open discussion
about the proposed changes.
Finally, we have identified steps for increasing the accountability of
the New Starts and JARC programs. For example, we previously reported
that outcome evaluations of completed transit and highway projects were
not usually conducted to determine whether proposed outcomes were
achieved.[Footnote 23] We noted that because outcome evaluations are
not usually completed, agencies miss an opportunity to learn from the
successes and shortcomings of past projects to better inform future
planning and decision making and increase accountability for results.
FTA also identified such evaluations as an opportunity to hold agencies
accountable for results and identify lessons learned, and therefore,
starting in fiscal year 2003, FTA required project sponsors to complete
before and after studies for completed New Starts projects. SAFETEA-LU
codified the requirement for before and after studies, and required
that these studies (1) describe and analyze the impacts of the new
fixed guideway capital project on transit services and transit
ridership, (2) evaluate the consistency of predicted and actual project
characteristics and performance, and (3) identify sources of
differences between predicted and actual outcomes. In addition, SAFETEA-
LU included several provisions, including the following, that emphasize
the accuracy and consistency of project cost and ridership estimates in
the New Starts process:
² SAFETEA-LU requires the Secretary of Transportation to consider the
reliability of the forecasting methods used by New Starts project
sponsors and their contractors to estimate costs and ridership as part
of the New Starts evaluation process.
² SAFETEA-LU allows the Secretary of Transportation to provide a higher
grant percentage than requested by the project sponsor if the net cost
of the project is not more than 10 percent higher than the net cost
estimated at the time the project was approved for advancement into
preliminary engineering and the ridership estimated for the project is
not less than 90 percent of the ridership estimated for the project at
the time the project was approved for advancement into preliminary
engineering.
² SAFETEA-LU requires the Secretary of Transportation to submit an
annual report to congressional committees analyzing the consistency and
accuracy of cost and ridership estimates made by contractors to public
transportation agencies developing new projects.
Likewise, we have raised issues associated with FTA's measurement of
the JARC program's results and made recommendations for improvement. In
April 2002, we testified that FTA had not yet completed its evaluation
of the JARC program or reported to Congress,[Footnote 24] as TEA-21
required.[Footnote 25] We also expressed concerns about FTA's plan to
evaluate the program using one performance measure--the number of
accessible employment sites--because it would not allow FTA to fully
address key aspects of the program or criteria for selecting grantees.
We reiterated these concerns in our December 2002 report and
recommended that FTA report to Congress on the results of its
evaluation of JARC, as required by law, and consider as part of its
evaluation of the effectiveness of the JARC program in meeting both of
its goals.[Footnote 26] Our most recent review of the JARC program
concluded that the data used in FTA's 2003 evaluation of the JARC
program lacked the consistent, generalizable, and complete information
needed to draw any definitive conclusions about the program as a
whole.[Footnote 27] According to FTA, it has faced obstacles in
evaluating the JARC program primarily because grantees have had
difficulty collecting and reporting information on their programs.
SAFETEA-LU requires the Secretary of Transportation to evaluate the
JARC program and submit a report describing the results of this study
to Congress by August 2008. Specifically, the Secretary must conduct a
study to evaluate the effectiveness of the grant program and the
effectiveness of recipients making grants to subrecipients. FTA has
already begun to take some steps to meet its evaluation requirements,
even prior to issuing its final program guidance. These steps may also
address some of the concerns we previously raised about FTA's
evaluation of the JARC program. For example, FTA has identified new
performance measures and goals, developed a preliminary performance
evaluation framework to guide its data collection efforts, and is
currently in the process of researching options for simplifying its
data collection system and reducing the reporting requirements for
grantees.
Mr. Chairman, this concludes my statement. I would be pleased to answer
any questions that you or other Members of the Subcommittee may have at
this time.
Contact Information:
For further information on this testimony, please contact Katherine
Siggerud at (202) 512-2834 or siggerudk@gao.gov. Individuals making key
contributions to this testimony include Vidhya Ananthakrishnan, Nikki
Clowers, John Finedore, Lauren Heft, Daniel Hoy, Jessica Lucas-Judy,
Nancy Lueke, and Kimanh Nguyen.
[End of section]
Appendix I: FTA's Proposed Changes to the New Starts Program:
In its January 2006 guidance, the Federal Transit Administration (FTA)
identified possible changes to the New Starts program in response to
the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA-LU). According to FTA, some of SAFETEA-LU's
provisions may lead to changes in the program's definition of
eligibility, evaluation and rating process, and project development
process. The following table summarizes the changes FTA has proposed in
these three areas, FTA's rationale for the proposed changes, and the
transit community's response to the proposed changes.
[See PDF for image]
Source: GAO analysis of FTA guidance and public comments posted on
FTA's docket.
[End of table]
[End of section]
Related GAO Products:
New Starts reports and testimonies:
Opportunities Exist to Improve the Communication and Transparency of
Changes Made to the New Starts Program. GAO-05-674. Washington, D.C.:
June 28, 2005.
Mass Transit: FTA Needs to Better Define and Assess Impact of Certain
Policies on New Starts Program. GAO-04-748. Washington, D.C.: June 25,
2004.
Mass Transit: FTA Needs to Provide Clear Information and Additional
Guidance on the New Starts Ratings Process. GAO-03-701. Washington,
D.C.: June 23, 2003.
Mass Transit: Status of New Starts Program and Potential for Bus Rapid
Transit Projects. GAO-02-840T. Washington, D.C.: June 20, 2002.
Mass Transit: FTA's New Starts Commitments for Fiscal Year 2003. GAO-
02-603. Washington, D.C.: April 30, 2002.
Mass Transit: FTA Could Relieve New Starts Program Funding Constraints.
GAO-01-987. Washington, D.C.: August 15, 2001.
Mass Transit: Implementation of FTA's New Starts Evaluation Process and
FY 2001 Funding Proposals. GAO/RCED-00-149. Washington, D.C.: April 28,
2000.
Mass Transit: Status of New Starts Transit Projects With Full Funding
Grant Agreements. GAO/RCED-99-240. Washington, D.C.: August 19, 1999.
Mass Transit: FTA's Progress in Developing and Implementing a New
Starts Evaluation Process. GAO/RCED-99-113. Washington, D.C.: April 26,
1999.
JARC reports and testimonies:
Job Access and Reverse Commute: Program Status and Potential Effects of
Proposed Legislative Changes. GAO-04-934R. Washington, D.C.: August 20,
2004.
Welfare Reform: Job Access Program Improves Local Service Coordination,
but Evaluation Should Be Completed. GAO-03-204. Washington, D.C.:
December 6, 2002.
Welfare Reform: DOT Has Made Progress in Implementing the Job Access
Program but Has Not Evaluated Impact. GAO-02-640T. Washington, D.C.:
April 17, 2002.
Welfare Reform: Competitive Grant Selection Requirement for DOT's Job
Access Program Was Not Followed. GAO-02-213. Washington, D.C.: December
7, 2001.
Welfare Reform: GAO's Recent and Ongoing Work on DOT's Access to Jobs
Program. GAO-01-996R. Washington, D.C.: August 17, 2001.
Welfare Reform: DOT Is Making Progress in Implementing the Job Access
Program. GAO-01-133. Washington, D.C.: December 4, 2000.
Welfare Reform: Implementing DOT's Access to Jobs Program in Its First
Year. GAO/RCED-00-14. Washington, D.C.: November 26, 1999.
Welfare Reform: Implementing DOT's Access to Jobs Program. GAO/RCED-99-
36. Washington, D.C.: December 8, 1998.
Welfare Reform: Transportation's Role in Moving from Welfare to Work.
GAO/RCED-98-161. Washington, D.C.: May 29, 1998.
Other transit-related reports:
Highway and Transit Investments: Options for Improving Information on
Projects' Benefits and Costs and Increasing Accountability for Results.
GAO-05-172. Washington, D.C.: January 24, 2005.
Transportation Disadvantaged Populations: Some Coordination Efforts
Among Programs Providing Transportation Services, but Obstacles
Persist. GAO-03-697. Washington, D.C.: June 30, 2003.
Transit Labor Arrangements: Most Transit Agencies Report Impacts Are
Minimal. GAO-02-78. Washington, D.C.: November 19, 2001.
Mass Transit: Many Management Successes at WMATA, but Capital Planning
Could Be Enhanced. GAO-01-744. Washington, D.C.: July 3, 2001.
Transit Grants: Need for Improved Predictability, Data, and Monitoring
in Application Processing. GAO/RCED-00-260. Washington, D.C.: August
30, 2000.
[End of section]
(542095):
FOOTNOTES
[1] TEA-21 required GAO to evaluate both the New Starts evaluation and
rating process and the JARC program on a regular basis. SAFETEA-LU
continued similar requirements. In particular, we are required to
review the New Starts evaluation and rating process each year and the
JARC program beginning 1 year after the enactment of SAFETEA-LU and
every 2 years thereafter. See the Related GAO Products at the end of
this testimony for a listing of previous reports on these programs.
[2] For this testimony, the term "states" includes the District of
Columbia, American Samoa, Guam, the Northern Marianas, Puerto Rico, and
the Virgin Islands. Large urbanized areas are those areas with
populations of 200,000 or more.
[3] During the preliminary engineering phase, project sponsors refine
the design of the proposal, taking into consideration all reasonable
design alternatives. This process results in estimates of the project's
costs, benefits, and impacts (e.g., financial or environmental).
According to FTA officials, to gain approval for entry into preliminary
engineering, a project must (1) have been identified through the
alternatives analysis process, (2) be included in the region's long-
term transportation plan, (3) meet the statutorily defined project
justification and financial criteria, and (4) demonstrate that the
sponsors have the technical capability to manage the project during
preliminary engineering. Federal New Starts funding may be used for
preliminary engineering activities, if so appropriated by Congress.
[4] Final design is the last phase of project development before
construction and may include right-of-way acquisition, utility
relocation, and the preparation of final construction plans and cost
estimates.
[5] As will be discussed, SAFETEA-LU identified additional criteria for
FTA to use in its evaluation and rating process. However, according to
FTA's January 2006 guidance, FTA does not plan to change the current
framework and methodology for evaluating and rating New Starts projects
(i.e., non-Small Starts projects) before publishing the new final rule
for its New Starts program, which is expected in January 2008.
[6] GAO, Welfare Reform: Implementing DOT's Access to Jobs Program,
GAO/RCED-99-36 (Washington, D.C.: Dec. 8, 1998).
[7] A before and after study is similar to an outcome evaluation in
that it compares the forecasted benefits and costs of a project with
the actual benefits and costs of the project after the project is
completed.
[8] FTA requires that the benefits and costs of the proposed New Starts
project be assessed in comparison with a baseline alternative defined
as the best that can be done without building a new fixed guideway. The
purpose of the baseline alternative is to distill the benefits (and
costs) of the proposed New Starts project from the benefits that could
be achieved through low-cost improvements, such as route realignments
and increases in service frequency, that would not entail the
significant cost of a New Starts project's infrastructure. FTA defines
the no-build alternative in two ways: (1) an alternative that
incorporates "planned" improvements that are included in the fiscally
constrained long-range plan for which need, commitment, financing, and
public and political support are identified and are reasonably expected
to be implemented, or (2) an alternative that adds only "committed"
improvements together with minor transit service expansions or
adjustments that reflect a continuation of existing service policies in
newly developed areas.
[9] Direct benefits of transportation investments, such as lowered
transportation costs and improved access to goods and services, result
in individuals, households, and firms acting to take advantage of those
benefits. These actions can then lead to several types of indirect
benefits, such as increased property values and new development.
[10] SAFETEA-LU added economic development to the list of evaluation
criteria; it also identified land use as a specific evaluation
criterion. Under TEA-21, land use was not identified as an evaluation
criterion, but rather as a "consideration" in the evaluation process
and FTA incorporated it into the evaluation process.
[11] Indirect benefits, such as economic development, may represent
transfers of economic activity from one area to another; and, while,
such a transfer may represent real benefits for the jurisdiction making
the transportation investment, it is not a real economic benefit from a
national perspective because the economic activity is simply occurring
in a different location.
[12] GAO, Highway and Transit Investments, Options for Improving
Information on Projects' Benefits and Costs and Increasing
Accountability for Results, GAO-05-172 (Washington, D.C.: Jan. 24,
2005).
[13] FTA refers to guidance for grantees and stakeholders as a
"circular;" in this testimony, we refer to FTA's draft and final
circulars for JARC as draft final guidance and final guidance.
[14] The SAFETEA-LU formula apportions JARC funds on the basis of
"eligible" low-income individuals in an area. Eligible low-income
individuals are defined in SAFETEA-LU as individuals whose family
income is at or below 150 percent of the poverty line.
[15] In information on the JARC program, FTA refers to urbanized areas
with a population of 200,000 or more as large urbanized areas,
urbanized areas with a population of between 50,000 and 200,000 as
small urbanized areas, and rural and small urbanized areas with
populations of less than 50,000 as other than urbanized areas.
[16] "Transportation-disadvantaged populations" refers to populations
that lack the ability to provide their own transportation or have
difficulty accessing whatever conventional public transportation may be
available. FTA programs in addition to JARC that serve these
populations are the Elderly Individuals and Individuals with
Disabilities program, which provides formula funding for capital
projects to assist in meeting the transportation needs of the elderly
and persons with disabilities; and the New Freedom program, which
provides formula funding for new public transportation services and
public transportation alternatives that assist individuals with
disabilities with transportation, including transportation to and from
jobs and employment support services.
[17] While TEA-21 had not included a statutory provision regarding a
percentage that could be used for administration and technical
assistance, FTA allowed JARC grantees to use up to 10 percent for these
activities.
[18] GAO, Job Access and Reverse Commute: Program Status and Potential
Effects of Proposed Legislative Changes, GAO-04-934R (Washington, D.C.:
Aug. 20, 2004). GAO, Transportation-Disadvantaged Populations: Some
Coordination Efforts Among Programs Providing Transportation Services,
but Obstacles Persist, GAO-03-697 (Washington, D.C.: June 30, 2003).
[19] The March 2006 notice also addressed the Elderly Individuals and
Individuals with Disabilities program and the New Freedom program.
[20] GAO, Public Transportation: Opportunities Exist to Improve the
Communication and Transparency of Changes Made to the New Starts
Program, GAO-05-674 (Washington, D.C.: June 28, 2005).
[21] GAO, Mass Transit: FTA Needs to Provide Clear Information and
Additional Guidance on the New Starts Rating Process, GAO-03-701
(Washington, D.C.: June 23, 2003).
[22] FTA noted that the projects received "not rated" ratings because
project sponsors were not following FTA requirements for development of
alternatives, resulting in a misrepresentation of the projects' user
benefits.
[23] GAO, Highway and Transit Investments: Options for Improving
Information on Projects' Benefits and Costs and Increasing
Accountability for Results, GAO-05-172 (Washington, D.C.: Jan. 24,
2005).
[24] GAO, Welfare Reform: DOT Has Made Progress in Implementing the Job
Access Program but Has Not Evaluated the Impact, GAO-02-640T
(Washington, D.C.: Apr. 17, 2002).
[25] TEA-21 required DOT to evaluate the JARC program and submit a
report to Congress by June 2000.
[26] GAO, Welfare Reform: Job Access Program Improves Local
Coordination, but Evaluation Should Be Completed, GAO-03-204
(Washington, D.C.: Dec. 6, 2002).
[27] GAO-04-934R.
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