Transportation Disadvantaged
Progress in Implementing the New Freedom Program Has Been Limited, and Better Monitoring Procedures Would Help Ensure Program Funds Are Used as Intended Gao ID: GAO-07-999R July 19, 2007The Americans with Disabilities Act (ADA) of 1990 seeks to ensure equal opportunity for persons with disabilities in employment, transportation, and other matters. ADA sets minimum standards for the accessibility of public transportation systems. For example, for persons unable to use a fixed-route bus or rail system due to disability, transit systems must provide service within three-quarters of a mile of the fixed-route service and during the same hours as the fixed-route service. In February 2001, the Bush Administration announced the New Freedom Initiative, a comprehensive program intended to extend and enhance efforts begun under ADA to help bring Americans with disabilities into mainstream life. According to the U.S. Census Bureau, in 2005 there were about 40 million noninstitutionalized persons over the age of 5 with one or more disabilities. In August 2005, the Safe, Accountable, Flexible, Efficient Transportation Equity Act--A Legacy for Users (SAFETEA-LU) authorized the New Freedom program, to be administered by the Department of Transportation's Federal Transit Administration (FTA). This program is designed to support new public transportation services and public transportation alternatives beyond those required by ADA. Congress appropriated $77.2 million for the New Freedom program in fiscal year 2006 and $81.0 million in fiscal year 2007. Program funds are distributed through grants from FTA to entities designated by state governors, and these grants may be used for operating support or capital projects. Operating and capital project grants require state/local matching funds. Projects eligible for New Freedom grants must be derived from a locally developed coordinated public transit-human service transportation plan (coordinated plan) with input from a wide variety of state and local entities, human service agencies, consumer groups, and others. On May 4, 2007, we briefed Congressional staff on the work Congress requested related to FTA's New Freedom program. The objectives of this work were to (1) determine the extent to which FTA has implemented the New Freedom program and identify concerns, if any, of selected state and local entities and (2) determine how FTA monitors program performance.
In general, we found that progress in implementing the New Freedom program had been limited and that state and local officials we spoke with identified implementation concerns. As of March 2007, FTA had awarded few grants--13 grants representing about 3 percent of funds appropriated in fiscal year 2006. FTA issued final program guidance in March 2007, after engaging in a careful and deliberate but time-consuming process of obtaining public and other stakeholder comments on interim versions of the guidance issued in March 2006 and September 2006. FTA officials conducted extensive outreach through listening groups and other mechanisms to help develop the final program guidance. FTA officials said this and compliance with the Administrative Procedures Act limited their progress in program implementation. FTA officials also told us that after consulting with some of its key stakeholders, FTA restricted project eligibility in its final program guidance by requiring that New Freedom projects be both new and beyond ADA requirements. In addition, FTA reported that few governors had designated the entities to receive program funds. Moreover, state and local officials we spoke with had made limited progress in developing coordinated plans. State and local officials also voiced concerns about the impact of matching fund requirements on project selection, the effect of limited program funding on their ability to undertake large projects, and the types of projects that qualify under the "beyond ADA" requirements. We also found that FTA had not fully developed policies and procedures for monitoring and oversight of the New Freedom program. In particular, FTA had not included specific provisions for the New Freedom program in its triennial and state management reviews, nor had it developed guidance about reviews of grantees not subject to triennial or state management reviews (called "spot" reviews). FTA officials told us that they plan to develop such procedures and had already begun to develop questions on the New Freedom program to be incorporated into the agency's existing oversight reviews. We believe that completing these procedures will be important to ensuring that funds are being used in accordance with program requirements and that recipients are being held accountable for their use of program funds. Based on our findings, we recommend that the Secretary of Transportation direct the FTA Administrator to develop and implement a plan to oversee the New Freedom program that includes adding program-specific provisions to the triennial and state management reviews and specifying the role and frequency of spot reviews.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-07-999R, Transportation Disadvantaged: Progress in Implementing the New Freedom Program Has Been Limited, and Better Monitoring Procedures Would Help Ensure Program Funds Are Used as Intended
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The Honorable John W. Olver:
Chairman:
Subcommittee on Transportation, Housing and Urban Development, and
Urban Development and Related Agencies:
Committee on Appropriations:
House of Representatives:
Subject: Transportation Disadvantaged: Progress in Implementing the New
Freedom Program Has Been Limited, and Better Monitoring Procedures
Would Help Ensure Program Funds Are Used as Intended:
Dear Mr. Chairman:
The Americans with Disabilities Act (ADA) of 1990 seeks to ensure equal
opportunity for persons with disabilities in employment,
transportation, and other matters. ADA sets minimum standards for the
accessibility of public transportation systems. For example, for
persons unable to use a fixed-route bus or rail system due to
disability, transit systems must provide service within three-quarters
of a mile of the fixed-route service and during the same hours as the
fixed-route service.[Footnote 1] In February 2001, the Bush
Administration announced the New Freedom Initiative, a comprehensive
program intended to extend and enhance efforts begun under ADA to help
bring Americans with disabilities into mainstream life. According to
the U.S. Census Bureau, in 2005 there were about 40 million
noninstitutionalized persons over the age of 5 with one or more
disabilities.
In August 2005, the Safe, Accountable, Flexible, Efficient
Transportation Equity Act--A Legacy for Users (SAFETEA-LU) authorized
the New Freedom program, to be administered by the Department of
Transportation's Federal Transit Administration (FTA). This program is
designed to support new public transportation services and public
transportation alternatives beyond those required by ADA. Congress
appropriated $77.2 million for the New Freedom program in fiscal year
2006 and $81.0 million in fiscal year 2007. Program funds are
distributed through grants from FTA to entities designated by state
governors, and these grants may be used for operating support or
capital projects. Operating and capital project grants require state/
local matching funds. Projects eligible for New Freedom grants must be
derived from a locally developed coordinated public transit-human
service transportation plan (coordinated plan) with input from a wide
variety of state and local entities, human service agencies, consumer
groups, and others.
On May 4, 2007, we briefed your staff on the work you requested related
to FTA's New Freedom program. Enclosure I contains the detailed
briefing slides that were presented to your staff on May 4, 2007. The
objectives of this work were to (1) determine the extent to which FTA
has implemented the New Freedom program and identify concerns, if any,
of selected state and local entities and (2) determine how FTA monitors
program performance. To accomplish these objectives, we reviewed
pertinent legislation, interim and final program guidance issued by
FTA, and New Freedom grants approved by FTA, and we interviewed FTA
officials in headquarters and two regions. We also interviewed
officials in organizations designated as grant recipients in three
large urban areas--Chicago, Illinois; Orlando, Florida; and Washington,
D.C.--and in three states--Illinois, Maryland, and Virginia. We
selected urban areas that had significant fiscal year 2006 New Freedom
funding and, among other things, were in different phases of program
implementation. The states were selected for their proximity to and
relationship with the urban areas selected and their differing
abilities to provide matching fund assistance. We conducted our work
from December 2006 to March 2007 in accordance with generally accepted
government auditing standards.
In general, we found that progress in implementing the New Freedom
program had been limited and that state and local officials we spoke
with identified implementation concerns. As of March 2007, FTA had
awarded few grants--13 grants representing about 3 percent of funds
appropriated in fiscal year 2006. FTA issued final program guidance in
March 2007, after engaging in a careful and deliberate but time-
consuming process of obtaining public and other stakeholder comments on
interim versions of the guidance issued in March 2006 and September
2006. FTA officials conducted extensive outreach through listening
groups and other mechanisms to help develop the final program guidance.
FTA officials said this and compliance with the Administrative
Procedures Act limited their progress in program implementation. FTA
officials also told us that after consulting with some of its key
stakeholders, FTA restricted project eligibility in its final program
guidance by requiring that New Freedom projects be both new and beyond
ADA requirements. In addition, FTA reported that few governors had
designated the entities to receive program funds. Moreover, state and
local officials we spoke with had made limited progress in developing
coordinated plans. State and local officials also voiced concerns about
the impact of matching fund requirements on project selection, the
effect of limited program funding on their ability to undertake large
projects, and the types of projects that qualify under the "beyond ADA"
requirements.
We also found that FTA had not fully developed policies and procedures
for monitoring and oversight of the New Freedom program. In particular,
FTA had not included specific provisions for the New Freedom program in
its triennial and state management reviews, nor had it developed
guidance about reviews of grantees not subject to triennial or state
management reviews (called "spot" reviews).[Footnote 2] FTA officials
told us that they plan to develop such procedures and had already begun
to develop questions on the New Freedom program to be incorporated into
the agency's existing oversight reviews. We believe that completing
these procedures will be important to ensuring that funds are being
used in accordance with program requirements and that recipients are
being held accountable for their use of program funds. Based on our
findings, we recommend that the Secretary of Transportation direct the
FTA Administrator to develop and implement a plan to oversee the New
Freedom program that includes adding program-specific provisions to the
triennial and state management reviews and specifying the role and
frequency of spot reviews.
We provided a draft of this report and the briefing slides to the
Department of Transportation and FTA for comment. DOT officials,
including the FTA Director of the Office of Transit Programs, generally
agreed with the findings in the report and briefing slides and said
they would consider the recommendation as they move forward in
implementing the New Freedom program. They also noted that they have
requested authority, in the President's fiscal year 2008 budget, to use
1 percent of New Freedom program funding for oversight. We believe that
it will be important for FTA to develop and implement an oversight plan
for the New Freedom program, regardless of whether FTA receives
specific funding for oversight of this program in its fiscal year 2008
budget.
As agreed with your office, unless you publicly announce the contents
of this report earlier, we plan no further distribution until 10 days
from the report date. We will then send copies of this report to the
Chairmen and Ranking Minority Members of the Senate and House
Subcommittees with jurisdiction over FTA matters. We will also send
copies to the Secretary of Transportation and the Administrator of the
Federal Transit Administration and other interested parties. In
addition, the report will be available at no cost on the GAO Web site
at [hyperlink, http://www.gao.gov].
If you or your staff have questions about this report, please contact
me at brownke@gao.gov or at (202) 512-7215. Contact points for our
offices of Congressional Relations and Public Affairs may be found on
the last page of this report. Individuals making key contributions to
this report are listed in enclosure II.
Sincerely yours,
Signed by:
Kay E. Brown:
Acting Director:
Physical Infrastructure Issues:
Enclosure I: GAO Briefing to House Subcommittee:
Transportation Disadvantaged: Progress in Implementing the New Freedom
Program Has Been Limited, and Better Monitoring Procedures Would Help
Ensure Program Funds Are Used as Intended.
Briefing for the Subcommittee on Transportation, Housing and Urban
Development, and Related Agencies, House Committee on Appropriations.
May 4, 2007:
Overview:
Introduction:
Objectives, Scope, and Methodology:
Results in Brief:
Background:
Results:
Conclusions:
Recommendations:
Agency Comments and Our Evaluation:
Appendix: I:
Introduction:
The Americans with Disabilities Act (ADA) of 1990, enacted in July
1990, prohibits discrimination against, and ensures equal opportunity
for, persons with disabilities in employment, transportation, and other
matters. ADA sets minimum standards for the accessibility of public
transportation systems. For example, transit providers must provide
complementary paratransit service [A] within ¾ of a mile of a fixed-
route transit service and during the same hours as the fixed-route
service for persons with disabilities.
In February 2001, the Bush Administration announced the New Freedom
Initiative, a comprehensive program initiative intended to extend and
enhance efforts begun under ADA to help bring Americans with
disabilities into mainstream life.
According to the U.S. Census Bureau, there were about 40 million
noninstitutionalized persons over the age of 5 with one or more
disabilities in 2005.
In August 2005, the Safe, Accountable, Flexible, Efficient
Transportation Equity Act”A Legacy for Users (SAFETEA-LU) authorized
the Federal Transit Administration‘s (FTA) New Freedom program (49 U.S.
C. § 5317). This program is designed to support new public
transportation services and public transportation alternatives beyond
those required by ADA, such as complementary paratransit service beyond
¾ mile of a fixed-route service.
a/To comply with the ADA, transit agencies must provide ’complementary“
paratransit or other special services--for people who are unable to use
the fixed-route bus and rail services due a disability”that are
comparable to the level of service provided to individuals who use the
fixed-route system.
Congress appropriated for the New Freedom program $77.2 million in
fiscal year 2006 and X81.0 million in fiscal year 2007.
Program funds are distributed through grants from FTA to entities
designated by state governors.
Grantees may provide transportation service themselves or through third
parties (called ’subrecipients“).
Grants may be used for operating support or capital projects and
require state/local matching funds.
Projects eligible for New Freedom grants must be derived from a locally
developed coordinated public transit-human service transportation plan
(called a ’coordinated plan“) with input from a wide variety of state
and local entities, human service agencies, consumer groups, and
others.
Objectives, Scope, and Methodology Objectives:
Objectives:
Determine the extent to which FTA has implemented the New Freedom
program and identify concerns, if any, of selected state and local
entities.
Determine how FTA monitors program performance.
Scope and Methodology:
We reviewed pertinent legislation interim and final program guidance,
and New Freedom grants approved by FTA and interviewed program FTA
officials in headquarters and two regions. We also interviewed
officials in organizations designated as grant recipients in three
large urban areas”Chicago, Illinois; Orlando, Florida; and Washington,
D.C.”and in three states (Illinois, Maryland, and Virginia). (See app.
I for more detail.)
We selected large urban areas that (1) had significant fiscal year 2006
New Freedom funding and were in different phases of program
implementation and (2) were among the highest in initial program
spending. 'We selected states for their proximity and their
relationship with the urban areas selected and their differing
abilities to provide matching fund assistance for New Freedom projects.
Our results for these selected areas cannot be generalized to the
nation as a whole.
Results in Brief:
Progress in implementing the New Freedom program has been limited and
the state and local officials we spoke with identified implementation
concerns.
* Progress at the federal level:
-Few grants have been awarded. As of March 2007, FTA had awarded a
total of 13 New Freedom grants that, together, represent about 3
percent of funds appropriated in fiscal year 2006.
-FTA issued final program guidance for the New Freedom program in March
2007.
-FTA revised its guidance to restrict project eligibility.
*Progress at the state/local level:
-Few governors had reported to FTA the entities to receive program
funds as of March 2007.
-Officials we spoke with had made limited progress in developing
coordinated plans.
* The state and local entities we spoke with had concerns about:
-Program matching fund requirements and their impact on project
selections.
- Limited federal money for the New Freedom program and the effect of
funding limitations on their ability to fund large projects.
-The types of projects that qualify under the ’beyond ADA“ requirements
of the New Freedom program.
FTA has not yet fully developed policies and procedures for monitoring
and oversight of the New Freedom program. FTA has taken steps to
develop such policies and procedures. However, several gaps could limit
program oversight and monitoring, including triennial and state
management reviews that do not yet include 'specific provisions for New
Freedom and unclear FTA guidance about the role of spot reviews.
Background:
New Freedom Program Funding:
Authorized by SAFETEA-LU for 4 years (fiscal years 2006-2009) at $339
million (see fig. 1).
* Congress appropriates funds for the program annually--$77.2 million
for fiscal year 2006 and $81.0 million for fiscal year 2007.
* FTA apportions annual appropriations to three types of areas (see
fig. 2):
- 60 percent to large urbanized areas (populations of 200,000 or more):
- 20 percent to small urbanized areas (populations of 50,000 to less
than 200,000), and:
-20 percent to other than urbanized areas (populations of less than
50,000).
* Apportionments are based on the number of persons with disabilities
in each area divided by the total number of persons with disabilities
in each area nationwide (see fig. 3). For example:
-Large urbanized area (population of 200,000 or more): Population of
persons with disabilities in each large urbanized area divided by total
population of persons with disabilities in all large urbanized areas
nationwide:
-Small urbanized area (population of 50,000 to less than 200,000):
Population of persons with disabilities in each small urbanized area
divided by total population of persons with disabilities in all small
urbanized areas nationwide.
Figure 1: SAFETEA-LU Authorizations and Appropriations for the New
Freedom Program in Fiscal Years 2006 to 2009 Background (cont.)
[See PDF for image.]
Source: FTA.
Note: The appropriation for FTA's fiscal year 2006 programs required a
1 percent recission, leaving $ 77.2 million available for apportionment
to the New Freedom Program.
[End of figure]
Figure 2: FTA‘s Apportionment of New Freedom Funds by Area ($77.2
million in Fiscal Year 2006; $81.0 million in Fiscal Year 2007)
Background (cont.)
[See PDF for image]
Source: FTA.
[End of figure]
Figure 3: Distribution of Persons with Disabilities in Large Urbanized,
Small Urbanized, and Other Than Urban Areas, as Used by FTA for Fiscal
Year 2006 Apportionments. Background (cont.)
[See PDF for image]
Source: GAO analysis of FTA data.
[End of figure]
Background (cont.):
New Freedom Program Funding (cont.):
* While large urbanized areas receive program funds directly, states
receive program funds for small urbanized and other than urbanized
areas. According to FTA, it does not allow states to suballocate funds
among specific small urbanized areas without a competitive process.
State and local matching fund requirements: 20 percent for capital
projects; 50 percent for operating assistance. Matching funds can come
from other federal, non- Department of Transportation funds such as
Medicaid and employment training programs.
Up to 10 percent of program funds may be used for administration with
no match required.
Under FTA guidance, grantees have 3 years to obligate New Freedom funds
for a given fiscal year (the fiscal year of apportionment plus 2
years). For example, fiscal year 2006 funds would remain available for
obligation through the end of fiscal year 2008.
Major Elements of FTA‘s New Freedom Program (see fig. 4):
Governors designate recipient agencies (called ’designated
recipients“).
* Local entities (e.g., transit agencies or metropolitan planning
organizations) are designated recipient agencies for large urbanized
areas.
* State agencies (e.g., state departments of transportation) are
designated recipients for small urbanized and other-than-urbanized
areas.
Designated recipients are expected to
* Select projects from coordinated plans. Under FTA program guidance,
organizations other than designated recipients may prepare the
coordinated plans.
* Conduct areawide (in urbanized areas with populations of over
200,000) or statewide (in small urban and other than urbanized areas)
solicitations for grant applications.
* Select projects for grant awards through a competitive process and
certify that the selected projects were derived from a coordinated
plan. However, FTA final program guidance allows designated recipients
to establish alternative arrangements to administer and conduct the
competitive selection process. This is intended to minimize the
potential for conflicts of interest when the designated recipient also
competes for program grants.
* Ensure program funds are distributed fairly and equitably through the
competitive selection process.
* Submit applications to FTA for New Freedom grants.
* Report to FTA about use of program funds.
* Monitor subrecipients‘ use of program funds.
* Major Elements of FTA‘s New Freedom Program:
Figure 4: Major Elements of FTA's New Freedom Program.
[See PDF for image]
Source: GAO analysis of FTA data.
[End of figure]
Planning Process and Coordinated Plans:
Fiscal year 2006 grants could be made without a formal coordinated
plan. Coordinated plans are required by law in fiscal year 2007 and
beyond. Fiscal year 2007 coordinated plans are expected to address at
least three elements”available services, service needs, and strategies
to address service gaps. FTA also expects coordinated plans to meet a
fourth element”relative priorities for implementation”by fiscal year
2008.
Coordinated plans should:
* Identify needs, resources, service gaps, service overlaps, and
priorities.
* Be coordinated with a wide array of transportation, human service,
and consumer groups.
* Include service needs that will be funded under FTA‘s Job Access and
Reverse Commute (JARC) and the § 5310 (Elderly and Persons with
Disabilities) programs.
* Include consideration of other programs for transportation
disadvantaged populations (for example, Temporary Assistance for Needy
Families or Medicaid recipients).
Results – Extent of New Freedom Program‘s Implementation and Concerns
Expressed:
Implementation of New Freedom program has been limited.
Progress at the federal level:
Few grants have been approved by FTA since the program was created. As
of March 2007, FTA had approved a total of 13 grants (see table 1).
* 4 were for the 10 percent administrative funds only.
* 9 were for a mix of service projects and administrative/planning
uses.
* Largest commitment of funds for service projects appears to be in
Iowa to purchase additional buses and provide operating support
($243,559).
A small portion of program funds has been committed. The 13 grants
receiving FTA approval represent about 3 percent of the fiscal year
2006 funds appropriated for the New Freedom program ($2.5 million out
of $77.2 million appropriated). FTA apportioned fiscal year 2007 New
Freedom funds on March 23, 2007.
Final program guidance was issued by FTA in March 2007.
* Prior interim guidance issued in March 2006 and September 2006.
* Interim guidance allowed early grants and was used by FTA to solicit
program comments.
* In general, FTA‘s implementation of the New Freedom program has been
careful and deliberate. Among other things, FTA has conducted extensive
outreach through listening sessions and held focus groups to help
develop final program guidance.
Table 1: FTA New Freedom Program Grant Approvals (Federal Funds Only),
as of March 1, 2007.
Recepient: 1: California State Department of Transportation;
Extended Service: $190,585;
Mobility Management [A]: $312,254;
Administration: $236,977;
FTA Approved: $739,816;
Recepient: 2: LYNX/Central Florida Regional Transportation Authority,
Orlando, Florida;
Extended Service: 88,379;
Mobility Management [A]: 195,000;
Administration: 31,487;
FTA Approved: 314,866;
Recepient: 3: Ventura County Transportation Commission, Ventura,
California;
Extended Service: 55,164;
Mobility Management [A]: 0;
Administration: 0;
FTA Approved: 55,164;
Recepient: 4: South Coast Area Transit, Oxnard, California;
Extended Service: 60,000
Mobility Management [A]: 0;
Administration: 0;
FTA Approved: 55,164;
Recepient: 5: City of Shreveport, Shreveport, Louisiana;
Extended Service: 70,851;
Mobility Management [A]: 0;
Administration: 7,872;
FTA Approved: 78,723;
Recepient: 6: City of Albuquerque, Albuquerque, New Mexico;
Extended Service: 0;
Mobility Management [A]: 0;
Administration: 14,700;
FTA Approved: 14,700;
Recepient: 7: City of Santa Fe, Santa Fe, New Mexico;
Extended Service: 51,249;
Mobility Management [A]]: 0;
Administration: 0;
FTA Approved: 51,249;
Recepient: 8: Texas Department of Transportation;
Extended Service: 0;
Mobility Management [A]: 0;
Administration: 139,642;
FTA Approved: 139,642;
Recepient: 9: Texas Department of Transportation;
Extended Service: 0;
Mobility Management [A]: 0;
Administration: 107,204;
FTA Approved: 107,024;
Recepient: 10: Iowa Department of Transportation;
Extended Service: 123,788;
Mobility Management [A]: 0;
Administration: 0;
FTA Approved: 123,788;
Recepient: 11: Iowa Department of Transportation;
Extended Service: 243,559;
Mobility Management [A]: 0;
Administration: 0;
FTA Approved: 243,559;
Recepient: 12: Regional Transportation District, Denver, Colorado;
Extended Service: 144,000;
Mobility Management [A]: 328,048;
Administration: 0;
FTA Approved: 472,048;
Recepient: 13: Ohio Department of Transportation;
Extended Service: 0;
Mobility Management [A]: 0;
Administration: 104,567;
FTA Approved: 104,567;
Totals: Extended Service: $1,027,575;
Totals: Mobility Management [A]: $835,302;
Totals: Administration: $642,269;
Totals: FTA Approved: $2,505,146;
a/ Mobility management can include coordinating service for persons
with disabilities, older adults, and low-income persons; supporting
local coordination policy bodies; or creating one-stop call centers for
eligible travelers.
Source: FTA.
[End of table]
Results – Extent of New Freedom Program‘s Implementation and Concerns
Expressed (cont.):
Progress at the federal level (cont.):
FTA revised its program guidance to restrict project eligibility.
* Interim guidance in March 2006 indicated New Freedom projects needed
to be either new or beyond ADA requirements.
* Interim guidance issued in September 2006 required that New Freedom
projects be both new and beyond ADA requirements.
* Final guidance issued in March 2007 requires that New Freedom
projects be both new and beyond ADA requirements.
Progress at the state/local level:
Few official designated recipients reported to FTA by state governors.
As of March 2007, FTA reported that state governors had designated 24
recipients for the 207 areas”states, territories, and large urbanized
areas (population of 200,000 or more)”eligible to receive program
funds.
Limited development of coordinated plans and competitive selection
procedures in areas we visited.
* Officials in all three large urban areas and in the three states we
contacted were still developing formal coordinated plans. Officials in
all three large urban areas said they expect to have such plans
developed during fiscal year 2007. In one state (Illinois), planning
regions that did not exist before were created to facilitate
preparation of the coordinated plans in small urbanized areas. Illinois
is also hiring Regional Coordinators to facilitate the preparation of
coordinated plans for small urban areas.
* Similarly, officials in all three large urban areas and in the three
states said they were still developing procedures to competitively
select projects for New Freedom funding.
Concerns of State/Local Entities We Spoke With:
Program matching fund requirements may affect project selection.
According to state and local officials we spoke to, some organizations
may not be able to obtain matching funds. Among the specific issues
mentioned by these officials were.
* Availability of state assistance. Some states plan to provide
matching funds but, others cannot or will not. For example, Maryland
officials said state assistance is available for matching funds for New
Freedom projects. However, officials with the designated recipient for
the Washington, D.C., metropolitan area and the state of Virginia told
us that such assistance is not expected to be available in Virginia.
* Need to reprogram funds from existing uses. Some officials told us
that human service agency (e.g., reprogram budgets have no extra money
that could be used for projects funded by New Freedom, and that
matching funds would have to come from funds provided for existing
services and projects.
* Potential restrictions on the use of matching funds from other
federal programs. Some officials told us that some human service
programs (e.g., Medicaid) may either have restrictions on the use of
their funds for transportation projects or funds could be slated for
other, nontransportation uses and thus not be available for matching
fund purposes.
Funding large projects will be difficult with the limited federal
program funds available for the New Freedom program. Officials from all
three large urban areas and all three states we spoke with said program
funds were limited and this might make it difficult to fund large
projects. Some officials told us that to cope with this situation they
might:
* Combine fiscal year 2006 and fiscal year 2007 New Freedom funds.
* Forgo the option to use 10 percent of program funds for
administration and instead use the funds for services.
* Select projects that are eligible for funding from multiple
transportation -programs (e.g., eligible for both New -Freedom and
JARC). Note: According to FTA, separate grants would be needed to
receive funds for each program. Also FTA‘s final program guidance of
March 2007 states that -provisions in SAFILTEA-LU do not permit
"pooling" of funds for programs like JARC and New Freedom.
The types of projects that qualify under the ’beyond ADA“ requirement
of the New Freedom program. Officials in two of the three large urban
areas and in all three states told us they were uncertain about what
types of projects would qualify for New Freedom funding under the
beyond ADA requirements" criteria. Officials in one large urban area
(Chicago) did not indicate a problem with this requirement.
Results-How FTA Monitors Program Performance:
FTA has not yet fully developed policies and procedures for monitoring
and oversight of the New Freedom program.
However, FTA has taken steps to develop such policies and procedures.
According to FTA:
* Existing oversight mechanisms will be revised to incorporate New
Freedom requirements. These mechanisms include:
- Triennial reviews of entities receiving capital grants under FTA‘s
urbanized area formula program (49 U.S.C. § 5307), such as transit
agencies.
- State management reviews of state agencies.
* FTA will design spot reviews of designated recipients not covered by
either triennial or state management reviews. Spot reviews will assess
the accuracy and adequacy of a recipient‘s management of the New
Freedom program.
Several gaps could limit program oversight and monitoring:
* Current triennial and state management review procedures do not yet
include specific provisions for the New Freedom program. These
procedures would need to include compliance with both statutory and
regulatory requirements of the New Freedom program, including whether
program funds have been distributed fairly and equitably through the
competitive selection process.
* FTA's guidance is unclear about the role of spot reviews. For
example, the guidance is unclear about whether spot reviews will be
more or less frequent than the current cycle for triennial reviews and
state management reviews. In addition, at the time of our work, FTA had
not yet developed a plan for implementing spot reviews.
According to FTA, it plans to start developing oversight requirements
now that it has issued final guidance for implementing the New Freedom
program. This would include adding New Freedom program questions to the
state management reviews and the triennial reviews. FTA also said it
plans to develop written guidance on spot reviews; however, no date has
been set for completing these activities.
We previously reported that performance reporting and oversight are
important for establishing accountability and evaluating performance.
Performance data allow agencies to share effective approaches,
recognize problems, look for solutions, and develop ways to improve
results. Oversight can help ensure that program funds are being used
for their intended purposes and that recipients can be held accountable
for their use of program funds.
In November 2006, we reported that monitoring gaps may limit FTA‘s
ability to oversee the JARC program. As with New Freedom, FTA proposed
to monitor JARC recipients through triennial reviews, state management
reviews, and spot reviews but had not worked out the details. We
recommended that FTA (1) update its guidance for state management and
triennial reviews to cover JARC topics and (2) specify how frequently
FTA will perform spot reviews of designated recipients that are not
subject to state management reviews or triennial reviews. See GAO,
Federal Transit Administration: Progress Made in Implementing Changes
to the Job Access Program, but Evaluation and Oversight Processes Need
Improvement, GAO-07-43 (Washington, D.C.: Nov. 17, 2006). DOT concurred
with our recommendation to update triennial and state management
reviews for JARC criteria. DOT partly concurred with our recommendation
to perform spot reviews, essaying that it could not totally concur due
to uncertainties about funding for JARC project management oversight.
The agency requested JARC project oversight activity funding for fiscal
year 2008.
Conclusions:
Progress in implementing the New Freedom program has been limited, it
is early in the process, and program recipients have not yet fully
developed some key elements of the program, such as coordinated plans.
Developing key elements will be important for the program‘s success.
FTA lacks fully developed procedures for monitoring the New Freedom
program but says procedures will be developed now that program guidance
is finalized. Until these procedures are in place, it will be difficult
to ensure that funds are being used in accordance with program
requirements and that recipients are being held accountable for their
use of program funds. Developing these procedures now will be important
before the program fully ramps up sand funding commitments
substantially increase. Recommendations:
We recommend that the Secretary of Transportation direct the
Administrator, FTA, to take the following actions:
Develop and implement a plan to provide oversight for the New Freedom
program that would include:
* Adding program-specific provisions for existing oversight mechanisms,
such as triennial reviews and state management reviews, and
* Specifying the role and frequency of spot reviews to ensure coverage
for those designated recipients that are not subject to current reviews.
Agency Comments and Our Evaluation:
We provided a draft of this briefing to the Department of
Transportation for review and comment. Officials from the Department
and FTA generally agreed with the briefing‘s findings, providing some
technical clarifications that were incorporated as appropriate. Those
officials also said that they would consider the recommendations as
they move forward in implementing the New Freedom program. In
particular, FTA officials said that FTA intends to include questions
about the New Freedom program in its triennial and state management
reviews and that it will conduct oversight of the New Freedom program.
To enable FTA to conduct more extensive oversight of the New Freedom
program in the future, FTA has included in the President's fiscal year
2008 budget a request for authority to use 1 percent of New Freedom
program funding for oversight.
[End of section]
Appendix I - Scope and Methodology:
Reviewed pertinent federal legislation and FTA‘s New Freedom interim
and final program guidance.
Analyzed apportionment data for fiscal year 2006 and 2007 and grants
approved by FTA as of March 2007.
Interviewed FTA New Freedom program officials in headquarters and
Regions IV (Atlanta) and V (Chicago).
Interviewed officials from:
* Three designated recipient agencies in large urbanized areas
(Washington, D.C; Chicago, Illinois; and Orlando, Florid-a).
* Three states (Illinois, Maryland, and Virginia). ¾ Three metropolitan
planning organizations in Chicago, Orlando, and Washington, D.C.
* Selected consumer groups representing persons with disabilities.
We selected large urbanized areas that (1) had significant fiscal year
2006 New Freedom funds and were in different phases of program
implementation, including different stages of preparing and processing
grant applications, and (2) were among the highest in initial program
spending.
We selected three states for their proximity to two of the large urban
sites selected (Chicago and Washington, D.C.), expecting that these
states might play a role in selecting projects for the New Freedom
program. Furthermore, regardless of their role in project selection,
these states would need to include New Freedom projects selected in the
large urban areas we chose in their state transportation improvement
programs. In addition, the states differed in their abilities to
provide matching fund assistance for New Freedom projects.
Our results for these selected areas may not be generalized to the
nation as a whole.
We conducted our work from December 2006 through March 2007 in
accordance with generally accepted government auditing standards.
[End of Section]
Enclosure II: Contact and Staff Acknowledgments:
GAO Contact:
Kay Brown, (202) 512-7215 or brownke@gao.gov:
Staff Acknowledgements: In addition to the contact named above, Rita
Grieco, Assistant Director; Ashley Alley; Richard Calhoon; H. Brandon
Haller; Richard Jorgenson; and Joshua Ormond made key contributions to
this report.
[End of section]
FOOTNOTES
[1] This is known as complementary paratransit service because it is
comparable to the level of service provided to individuals who use the
fixed-route service.
[2] Triennial reviews are conducted at least once every 3 years on
urbanized area formula grantees to evaluate formula grant management
performance and grantee compliance with FTA and other federal
government requirements. State management reviews assess states'
implementation and management of the Elderly and Persons with
Disabilities program, the Nonurbanized Area Formula program, and other
programs to ensure they are being administered in accordance with FTA's
requirements and are meeting program objectives. Triennial and state
management reviews are part of FTA's established program oversight
mechanisms.
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