Transit systems face across-the-board cuts, diminished funding stream under House bill

July 21, 2011
By Sean Barry

The House has not yet released the full text of a transportation bill proposal, but the House Transportation and Infrastructure Committee has released an outline of the principles that will be included in the bill. We posted an analysis of the outline here. This is one in a short series of posts looking into some of the provisions with a little more depth. – Ed.

P4211073_1 Originally uploaded by paulkimo90 to Flickr.

The House proposal contains scant information about public transportation, but by most indications, non-highway projects would have more difficulty receiving funding and prioritization compared to current law.

The outline did not explicitly call for maintaining the historic 20 percent share of Highway Trust Fund dollars for public transportation, though both Chairman Mica and Committee staff indicated verbally at a press conference that the 80/20 ratio would be preserved, albeit as part of a much smaller share of total dollars. Though even with the 20 percent share intact, the overall 35 percent cut would result in steep fare hikes, service cuts, job losses or some combination thereof.

Though overall funding would decrease by 35 percent, the bill purports to increase funding for rural and suburban transit systems but does not identify a dollar amount or from where these dollars might be taken. Many rural and suburban systems are indeed underfunded and require additional support, but this investment ought to occur in the context of sufficient resources for all networks.

Would the House bill take money from already cash-strapped and demand-heavy urban transit systems? And, if not, where would these additional dollars come from? Would allocations be determined by merit or by politics?

Consistent with the bill’s efficiency theme, Mica proposes to streamline the New Starts program, the main source of current funding for building or expanding transit systems. The bill purports to cut project development time in half but does not specify how this would be accomplished. Private-sector partners would also be given new opportunities to offer services, though once again, details are scant.

What specific changes would the House bill make to current New Start criteria? Would private services be allowed to take the most lucrative routes, leaving municipal services to pick up the slack on money-losing alternatives? What about transit agencies that are already engaging in constructive public-private partnerships?

Amtrak’s operating funds are slated to be reduced by 25 percent in the first two years of the bill, and limitations would be placed on Amtrak’s use of federal dollars in the future. With demand for Amtrak services at record-highs, what is the justification for such a steep cut?

The bill does not provide any specific funding for high-speed rail, which will be dealt with in companion legislation. High-speed rail would become an eligible project under the existing Railroad Rehabilitation and Improvement Financing program that provides loans for rail projects, but it is not clear what revenue sources would be available to repay these loans. Will high-speed rail have the same opportunity to compete for federal dollars as traditional highway and transit projects?