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Shutdown averted; another crisis created

people waiting for a train

The U.S. Department of Transportation (USDOT) is refusing to obey the rules and Congress has so far been powerless to stop them. At stake are billions in federal funding for new and expanded transit systems that USDOT doesn’t want to award. But a policy change that attempts to reign in USDOT and make it obey the law could just be making matters worse.

Congress today has done its part to avert a government shutdown by passing a continuing resolution (CR) that will fund the federal government through November 21. The president has until Monday night to sign it. While a CR is generally just a continuation of existing policy, this one tweaks a key, but very wonky, policy for the Capital Investment Grant (CIG) program—the main source of federal funding for building new and expanding existing transit systems.

The CIG program has been under attack by the Trump administration, which is ideologically opposed to funding transit, since day one. Because Congress has continued to fund the program, USDOT has instead sought to sabotage the grant-making process by delaying grants, shutting down lines of communication, and making the whole process more opaque and confusing to everyone involved: Congress, project sponsors, and the public.

Now here’s where it gets wonky. In fiscal years (FY) 2018 & 2019, Congress tried to hold USDOT accountable by adding new language to their appropriations bills that required the agency to actually award (i.e. “obligate”) at least 85 percent of the funds for that fiscal year by the end of the following calendar year (so 85 percent of FY18 dollars would need to be spent by December 31, 2019 and FY19 dollars spent by the end of 2020).

The CR that Congress just passed changes that language to say that USDOT must “allocate,” rather than “obligate,” at least 85 percent of those funds. Allocation is not the same thing as obligation and results in zero dollars actually going to project sponsors.

The original “obligation” language was designed to force USDOT to advance projects through the CIG pipeline and actually award funding by signing grant agreements. The change comes from a concern that USDOT will simply ignore the law—let that statement sink in—which would result in Congress clawing back the CIG funding through a lengthy legal process.

In essence, USDOT doesn’t want the money even though Congress gave it to them anyway and ordered them to spend it because they know local communities are counting on it for their transit projects. But USDOT is ignoring the law and spending as little of the funding as they can get away with. To date, USDOT has only spent about a third of what Congress has authorized over the past three years. It’s understandable that Congress would seek another solution to get grants out the door—we agree more is needed—but focusing on “allocating” funds could create a new problem while failing to solve the original one.

Creating a new problem

Changing the requirement for “obligation” to “allocation” through the CR ignores the new realities on the ground. It used to be that an “allocation” meant something. USDOT would allocate funds to projects that were almost finalized and ready for construction to signal that a grant was to follow shortly. Under previous administrations, allocations would inform how much money Congress would provide in the budget for the CIG program and signal an imminent grant. But this administration has broken from precedent. “Allocations” from this USDOT are a big old nothingburger.

As we have previously described, an “allocation” is simply an internal accounting in the ledgers at USDOT. It doesn’t mean funding has been awarded nor does it guarantee that funding will ever arrive. In at least nine cases, communities have been waiting for months without funding despite receiving an allocation. One of those projects—the Purple Line subway extension in Los Angeles—has received two separate allocations without receiving a dime of federal money.

A table of nine nine unfunded transit projects with allocations and the date of the allocations

Congress’s new rules in the CR would unfortunately do nothing to ensure these communities receive funds and would give undue credit to USDOT for “allocating” these funds, regardless of whether that allocation eventually results in a formal grant.

Instead of simply swapping “obligate” for “allocate,” we’ve proposed that Congress requires a strict timeline for DOT between making an allocation and an obligation, along with requirements for the DOT to regularly communicate with Congress and project sponsors about the status of all projects that are seeking CIG funding. While Congress can’t do USDOT’s work for them, it can exercise aggressive oversight that would make it much harder for the agency to just sit on its hands. USDOT’s actions (or lack thereof) to date have more than justified such an approach.

Congress’s heart is in the right place; they’re trying to make USDOT obey the law and administer the CIG program as intended. The fact that Congress is even in this position speaks to the sordid state of affairs at USDOT. But their proposed remedy to this problem—changing policy in the CR to focus on tracking internal accounting (“allocations”) instead of executed grants—could just end up making things a whole lot worse.

Trump admin moving to end transit construction program and TIGER immediately

New documents released this week by the Trump administration make it clear that 2018 won’t be soon enough to eliminate funding for future transit construction and TIGER competitive grants — they want them gone now, in 2017.

After months of promises to invest a trillion dollars in infrastructure, President Trump’s 2018 budget request proposed eliminating the popular TIGER competitive grant program and ending the support for helping cities of all sizes build new transit lines, among other cuts.

This week, it’s become clear that the 2018 fiscal year (which begins this October) isn’t soon enough for the administration — they are now asking Congress to make most of the same cuts and changes in (the rest of) this year’s budget for 2017.

“The Administration proposes to suspend additional projects from entering the [transit capital grants] program, and believes localities should fund these localized projects.”

That’s what the Office of Management and Budget is requesting for the federal transit capital construction program, according to Jeff Davis’ Eno Transportation Weekly. That’s paired with a request to cut funding for transit construction by about $400 million for the rest of this fiscal year. Unlike the President’s recent proposal for the next fiscal year (2018), these cuts are proposed for the budget that Congress is negotiating now to keep the government operating through October.

You can help save these vital programs 

We’re looking for national, state and local organizations to demonstrate their support for fully funded TIGER and transit Capital Investment Programs. Sign onto T4America’s nationwide support letter by Friday, March 31st. 

Budget background: The government is operating under a continuing budget resolution (CR) because Congress failed to pass individual spending bills in late 2016 for this fiscal year. They instead passed a single bill to keep the government functioning at 2016 funding levels for most programs. Congress must produce budgetary legislation of some kind before the current CR expires on April 28, or run the risk of once again shutting down the government.

What does this mean for transit?

For one, it means $400 million less available this year to distribute to the ready-to-go transit projects that the federal government has already promised to fund by signing a full-funding grant agreement (FFGA). That means some unknown number of transit projects that were initially recommended to receive funding from FTA this year would be left out.

Secondly, suspending the pipeline means that transit projects in cities like Indianapolis, Tempe, Albuquerque, Ft. Lauderdale and dozens of others would be at the front of a line that would not move again under President Trump. Some of these cities expected to move ahead this year and were even recommended for funding by the Federal Transit Administration. Many have already pledged millions of their own dollars or have started development, engineering or construction work on projects that are on the cusp of receiving a federal grant to help complete it. And despite the administration’s belief that “localities should fund these localized projects,” the federal government funds interstate interchanges, highway widenings and road construction projects that are inherently local in nature almost every single day. There’s nothing more “local” about a transit project at all.

The administration is not satisfied to see the pipeline of transit projects shut down in 2018 — they want it shut down as soon as possible, in whatever budget Congress produces to carry us through the rest of this year.

What’s the news for TIGER?

It could mean the end of TIGER grants this year, with no grants awarded in 2017 at all.

CQ Roll Call reports that congressional housing/transportation appropriators are being asked to cut $2.7 billion from their budget for the rest of this year and eliminate $500 million from the TIGER program for this year — the entirety of this year’s funding. In years past, spring had been the time of year when USDOT would typically open the application period for this year’s batch of awards, with the aim to award TIGER grants sometime this fall. Though TIGER is technically funded for this year, with no certainty about a budget for the second half of the year from April to October, USDOT won’t make funding available that could be rescinded by Congress. And this is exactly why.

If you represent an organization of some kind, sign onto T4America’s nationwide support letter for these programs by Friday, March 31st. 

Budget battles leave a cloud over transportation funding as lame duck session looms

Same story, different year. Once again, we’re nearing the beginning of a new fiscal year on October 1, and Congress has failed to pass a budget to fund the government for the upcoming year. Even if Congress adopts a temporary budget to avert a shutdown —which is looking likely — important transportation programs could be left on hold on until lawmakers pass a full budget.

The House and the Senate never resolved their disagreement over the annual appropriations for transportation for the upcoming fiscal year — one of many budget issues that they couldn’t agree on this year. As in years past, the Senate provided more money for transportation programs in their appropriations bill than did the House. See the last column in the table below:

FY14

USDOT actual
GROW AMERICA Act for FY15 (President's 4-year proposal)HOUSE FY15 THUD Proposal ( & difference vs FY14 actual)SENATE FY15 THUD Proposal (& difference vs FY14 actual)DIFFERENCE between House & Senate FY15 proposals
Federal-Aid Highways$40.26B$48.062B$40.26B$40.3B (+$40M than FY14)+$40M in Senate proposal
Transit Formula Grants$8.6B$13.914B$8.6B$8.6B-
Transit 'New & 'Small Starts'$1.943B$2.5B$1.691B (-$252M than FY14)$2.163B (+$220M than FY14)+$472M in Senate proposal
TIGER$600M$1.25B$100M (-$500M than FY14)$550M -($50M than FY14)+$450M in Senate proposal
Amtrak Operating$340MProposes to roll passenger rail into two new programs that total $4.775 billion*$340M$340M-
Amtrak Capital$1.05Bsame as above$850M (-$200M than FY14)$1.04B (-$10M than FY14)+$190M in Senate proposal
High speed rail$0same as above$0$0-
*Up to $35 million is available for planning activities in the Senate FY15 THUD proposal.
**The FY15 Administration Budget (Grow America Act) consolidates existing rail programs into 2 new programs (Rail Service Improvement Program and Current Passenger Rail Service).

With no progress made toward passing individual appropriations bills, or an “omnibus” that includes them all together in one package, Congress is moving on to temporary measures.

Yesterday, the House introduced a “continuing resolution” to extend government funding through mid-December that, if adopted, is expected to pass the Senate shortly afterward. That would ensure that the government can continue operating at the same funding levels as this past year. But it means that negotiations on a full budget will have to take place during the “lame duck” session, after the November elections but before losing members leave and new members arrive. That, or punt once again again until the new Congress starts in January.

With the elections likely to change the political landscape of Capitol Hill, it’s hard to predict what might happen after November 4th with any certainty.

In any case, as long as the government is operating via a short-term budget, any programs that are discretionary at USDOT (i.e., not funded from the Highway Trust Fund) will likely face great uncertainty. That means the next round of TIGER grants, money for new transit expansion (New and Small Starts), and passenger rail funding might see delays in when they’re awarded — creating even more funding uncertainty for states, metro areas and transit agencies.

At least the Highway Trust Fund is on stable footing until May, right, since Congress managed to scrounge up $10.8 billion through all manner of accounting gimmicks to temporarily delay insolvency?

Well, perhaps.

You might remember that about a year ago, USDOT was predicting that the trust fund would go bankrupt sometime late in 2014. Once we got into 2014, however, the deadline started shifting earlier. September. August. Then the end of July. So, in truth, who knows whether $10.8 billion actually will get us to May? It wouldn’t be too surprising to see a report from USDOT sometime in January or February, much as last time, saying that the trust fund is likely to reach insolvency a little sooner than previously thought.

One way or another, we’ll know more soon. Provided a shutdown is averted, members of Congress are scheduled to leave Washington after next week until the elections.

 

Government shutdown averted in last-minute budget deal, with some cuts to transportation

Down-to-the-wire negotiations late last night between President Obama, House Speaker John Boehner and Senate Majority Leader Harry Reid resulted in a budget deal containing about $38 billion in reductions from current spending levels and the prevention of a government shutdown.

With the Federal Government slated to close at midnight, the House and Senate passed a final one week stop-gap measure to allow the details of the agreement to be ironed out. The continuing resolution itself contains $2 billion in cuts that largely hit the U.S. Department of Transportation and Department of Housing and Urban Development.

By next week, Congress is expected to finalize its fiscal year 2011 budget — which runs through September — at the agreed-upon funding levels. President Obama made brief remarks on the budget compromise at the White House shortly after 11pm last night.

The cuts to transportation and housing passed last night were deemed largely non-controversial because they matched closely with the funding levels requested in President Obama’s fiscal year 2012 budget.

The High Speed and Intercity Passenger Rail program will receive $1 billion, a reduction of $1.5 billion from the previous year, and the New Starts program — a key revenue source for transit projects throughout the country — loses $280 million, though the resulting figure is reportedly sufficient to fund projects that have already received grants from USDOT. Other cuts include:

  • $6.3 million from the Transportation Planning, Research, and Development account
  • $2.5 million from the Federal Railroad Administration’s Research and Development; and
  • The Transit Research and University Research Centers Program budget is reduced to $64.2 million.

Details on the remainder of the fiscal year cuts and how they will affect transportation are not yet available, although Politico has early information on a few items:

One of the toughest fights, casting the White House as the budget cutter against reluctant Republicans, was in highway and transportation spending. But here the administration succeeded in cutting about $630 million in so-called orphan earmarks and $2.5 billion in unexpended contract authority.

We expect to hear more about the final package soon.

UPDATE: A White House blog post confirms that the fiscal year 2011 cuts include $630 million in earmarked transportation projects and $2.5 billion in funding that was slated for transportation projects.

Photo courtesy of the Washington Post.

Compromise on two-week spending bill temporarily spares crucial transportation programs from deep cuts

The federal government will keep the lights on next week after the U.S. Senate easily approved the House’s two-week stopgap measure containing $4 billion in spending cuts. The vote was 91-9.

Although some in the press have characterized the development as a victory for Republicans, the $4 billion in reductions is decidedly modest and overlaps with programs already targeted in President Obama’s fiscal year 2012 budget. Only two budget items — $650 million from a one-time Federal Highway Administration program and a handful of legislative earmarks – are transportation related.

However, the measure to fund the government for two weeks received 85 Democratic “no” votes in the House — including Minority Leader Nancy Pelosi —  and a chilled reception in the Senate even from those Democrats voting in favor. Unifying the more liberal-leaning Senate Democrats wary of deep cuts with moderates who are more open to them could be difficult. Some members were also alarmed by remarks from Speaker John Boehner that cutting “one slice at a time” could achieve his party’s goals if deep reductions were not passed in one package.

House Transportation and Infrastructure Committee Chairman John Mica was a yes vote, as was top committee Democrat Nick Rahall. Senate Environment and Public Works Committee Chairman Barbara Boxer and Republican counterpart Jim Inhofe also voted yes.

Though spared for the time being, crucial transportation programs like New Starts, high-speed rail and TIGER grants remain on the chopping block. So far, cuts to transportation have not received a lion’s share of the attention, though Senator Dick Durbin of Illinois highlighted his opposition to TIGER grant cuts at two events last month and several House members offered amendments to restore essential funding to public transportation.

This week’s compromise does not preclude a shutdown later this month, given the seemingly wide gulf between the two parties on what level of spending cuts are acceptable. Some Democrats said they fear the short two-week timeline will induce gridlock and result in Republicans re-offering their $61 billion spending reduction plan as an alternative.

House approves 2011 budget containing deep cuts to transportation

FINAL UPDATE, 2/19/11, 9am: The House voted 235-189 in favor of an FY2011 budget containing $60 billion in spending cuts.

No Democrats supported the continuing resolution and three Republicans opposed it. The Hill has more here, and the final roll call vote is here.

ORIGINAL POST: The U.S House of Representatives is currently debating a bill to fund the government through September of this year. As we noted earlier in the week, the budget under consideration contains deep cuts to transportation, including many of travel options Americans use and support.

Some of the most important cuts to transportation contained in the initial language include:

  • New Starts, the program that funds new transit construction, gets cut by $430 million. There is also a rescission of about $300 million in unspent 2010 (fiscal year) funds.
  • High-speed rail is cut completely and the CR would rescind essentially all funds from 2010. Other than the money already spent, this entire program is eliminated.
  • The innovative TIGER program is eliminated completely and the unspent/unobligated FY10 funds are rescinded.
  • Amtrak appears to be mostly intact, avoiding the cuts that were proposed by the GOP study committee.

These cuts are the wrong direction for a fragile economy and high unemployment rate. And, as a recent report from Smart Growth America noted, spending on public transportation and infrastructure maintenance is one of the best job-creation tools around. Why would Congress put that at risk?

As if those cuts were not bad enough, several members offered amendments that would go even deeper. Some of the amendments  include:

  • Amendment No. 453, which would eliminate all funding for Amtrak. (Sponsor: Rep. Connie Mack, R- Florida)
  • Amendment No. 45, which would reduce Amtrak funding by $447 million (Sponsor: Rep. Pete Sessions, R-Texas)
  • Amendment No. 204, which would remove funding for the White House Director of Urban Affairs (Sponsor: Rep. Steve Scalise, R-Louisiana)

A number of amendments would restore critical programs. These include:

  • Amendment No. 400, which would restore all Recovery Act funding (Sponsor: Rep. Sheila Jackson Lee, D-Texas)
  • Amendment No. 69, which would restore funding to the TIFIA grant program (Sponsor: Rep. Jared Polis, D-Colorado)
  • Amendment No. 44, which would restore most public transportation funding (Sponsor: Rep. Jerrold Nadler, D-New York)

An amendment sponsored by Northern Virginia Democrat Gerry Connolly that would have restored cuts to the Washington DC Metro system was ruled out of order by House Republicans and will not come up for a vote.

Congress is expected to continue debating for several hours, with a final vote time still unclear. Amendments relating to the Department of Transportation have not yet been considered.

UPDATE, 2/17/11, 9:30am: The House took up or postponed action on two amendments of interest late last night:

  • Amendment No. 511 (Nadler), which would have restored funding to several transportation programs, was ruled as out of order for lack of a revenue source and will not come up for a vote.
  • Amendment No. 43 (Sessions), which would reduce Amtrak funding by $447 million, was postponed and is expected to receive a vote today.

UPDATE, 11:15am: Amendment No. 43 (Sessions), which sought to reduce Amtrak funding by $447 million, was defeated by a vote of 176-250.

UPDATE, 3pm: The House still has a number of amendments to consider on the Transportation and Housing portions of the budget. Members will continue debating into the evening, with a late vote expected on the full package.

UPDATE, 7pm: Amendment No. 204 (Scalise), which seeks to remove funding for several positions, including the White House Director of Urban Affairs, was approved by a vote of 241-171.

The Hill has more information on this vote.

UPDATE, 2/18/11, 10am: The House adjourned past 1am last night without voting on the bill. Debate continues today.

UPDATE, 12:45pm: The House is debating the “Republican Study Committee” amendment, which would add an across-the-board 5.5 percent cut to the entire budget, with exemptions for defense and homeland security. The amendment would also reduce legislative budgets by 11 percent.

Republican Rep. Dan Lungren, a member of the Committee, is opposing the amendment, saying the cuts to Capitol Police and legislative staff are too deep. House Appropriations Chairman Hal Rogers, Republican of Kentucky, also opposes the amendment.

UPDATE, 3:30pm: The amendment seeking an across-the-board spending cut of 5.5 percent was rejected by a vote of 147-281.

The Hill has more information.

House budget for the rest of 2011 has deep cuts for transportation

On the Friday before the President releases his budget for 2012 (forthcoming sometime this morning), the House Appropriations Committee, led by Chairman Hal Rogers (R-Ky.) released their funding proposal to carry the government through the rest of 2011.

Quick refresher: The government is currently operating under what’s known as a Continuing Resolution (CR) that expires in March. Congress has been under pressure since late in 2010 to pass a full budget, but have been passing Continuing Resolutions due to an inability to agree on and pass a budget. These CRs basically continue funding levels from the 2010 fiscal year until Congress manages to pass a budget for 2011. Or they pass a CR with cuts and lower funding, which is what the House has proposed.

The 2011 budget that passed out of the Appropriations Committee Friday afternoon has some significant cuts for transportation, and some of them mirror the proposal that came from the Republican Study Committee a few weeks ago. There are a lot of cuts to very worthwhile programs across the board, but here are some of the highlights (lowlights?) for transportation:

  • New Starts, the program that funds new transit construction, gets cut by $430 million. There is also a rescission of about $300 million in unspent 2010 (fiscal year) funds.
  • High-speed rail is cut completely and the CR would rescind essentially all funds from 2010. Other than the money already spent, this entire program is eliminated.
  • The innovative TIGER program is eliminated completely and the unspent/unobligated FY10 funds are rescinded.
  • Amtrak appears to be mostly intact, avoiding the cuts that were proposed by the GOP study committee.

These cuts target exactly the kinds of projects that can create the most jobs and can help get our economy moving. Costs for labor and material are low right now, making it a prime time to spend on infrastructure, and we know that spending on public transportation creates more jobs than other types of transportation spending.

While these cuts are indeed severe and may get some support in the House, this proposal will still have to make it through the Senate.

We’ll be back later today with some information on how you can contact your Representative and urge them to reject these cuts to critical transportation projects.