state transit funding Archives - Page 2 of 2

With cities and suburbs clamoring to build new transit systems, a new book showcases creative financing approaches for getting them built

This new free guidebook from Transportation for America is designed to help community leaders across the country meet the demand for transit by raising money to build and operate it outside of the traditional federal funding sources.

Download the full guidebook (10.8mb pdf)

Find out more about the guidebook in the resources area.

The demand for public transportation service is at its highest point in 50 years.The causes are many: rising gas prices, an increasingly urbanized population, growing numbers of seniors, and the preferences of the “millennial” generation. These factors and more are contributing to soaring ridership on existing transit routes. And more communities today are looking for funds to build and operate rail and bus lines than ever before.

Yet a combination of ideological gridlock in Congress, dwindling federal gas tax revenues, and the elimination of earmarks have made the traditional approaches to building transit much more challenging. But despite these obstacles, many communities are finding creative ways to move ahead. From Tucson to Charlotte, communities across the country are rounding up funding from sources outside of the traditional federal funding sources to build tomorrow’s transportation system today.

Growing public interest in transit is leading many communities to look for ways to create or expand their transit systems, but as more communities apply for money from a shrinking piece of the pie, the already over-subscribed traditional federal programs for transit won’t be able to fund every project seeking assistance. To make the money go further, the New Starts transit program, the main source of funding for new transit systems, has recently covered one-half of project costs, down from 80 percent in the past, with some projects getting as little as one-third of their required total.

Even with this policy in effect the waiting list grows longer every year.

But all is not lost. There are ways to pay for new transit investments without waiting so long, and a growing number of communities are pursuing them. But doing so requires more sophistication in the art of project finance than has been needed in the past.

Someday—soon, we hope—the federal government may respond to the high level of demand for new transit investments by increasing funding available to communities. Those of us who aspire to provide these options for people in our communities must continue to work toward that goal. In the meantime, though, we can demonstrate the depth of the need and the strength of our desire by finding our own creative ways to make these projects happen.

This new guidebook is a first step toward that goal. We’ll be posting excerpts and stories here in the coming days, but you can download the full book today.

Top Left: Photo courtesy of the Metro Library and Archives, top right: Flickr photo by the Seattle DOT, bottom right: Flickr photo by Andrew Bossi, bottom left: Flickr photo by Steven Vance

America’s transit systems require $77.7 billion just to reach a state of good repair

Old Train Car with Broken Glass Originally uploaded by The Upstairs Room to Flickr.

Failure to keep up with regular maintenance and repair in many of our country’s public transportation systems due to tightened budgets is literally slowing us down, through longer commutes, unreliable service and reduced access, exacerbating the effects of a down economy and high unemployment.

This is part of what prompted Transportation Secretary Ray LaHood to seek a report on the cost of bringing our nation’s transit systems into a state of good repair.

The Federal Transit Administration study reveals chronic underinvestment in the nation’s transit systems and estimates $77.7 billion is needed just to rehabilitate what we already have. Unfortunately, that figure is more of a floor than a ceiling. The $77.7 billion would simply modernize and repair existing transit systems, without even beginning to build the tracks or build the new projects urgently needed to keep up with burgeoning demand.

Sadly, we are nowhere near where we need to be.

Rather than matching the needed level of investment, public transit spending in 2008 clocked in at less than $13 billion. According to the FTA, “the Study’s findings — in particular the magnitude of the investment backlog — emphasize the need for a more comprehensive understanding of transit reinvestment needs.”

The New York Times echoed that theme in a recent story. The Times noted a recent incident on Maryland’s commuter rail system (MARC) in which 900 commuters on a train home to Maryland from Washington, D.C. were stuck near Union Station for two hours, with temperatures reaching as high as 110 degrees. One especially disgruntled rider ventured that air-conditioned jails in Georgia would be preferable to staying on the train.

Though important, this isn’t just about comfort. Millions of Americans, young and old, urban and rural, rely on transit system each day to get to work, school or other daily needs. Disruptions to these services are much more serious than a mere inconvenience. In tough times, we should be making it easier for people to go about their lives and get to work, but chronic underinvestment in transit is making these things harder instead.

One of the biggest contributors to incidents like those on the DC Metro is simply the age of the equipment. Every year, the price of buying new parts and repairing rail lines goes up, and every year the upgrades or repairs don’t happen, keeping the trains running becomes more expensive and difficult.

Despite this, the Times notes that “the federal government is unlikely to step in to help the strapped city, state and local transit agencies,” despite what AASHTO spokesman Tony Dorsey described as “the perfect storm” that is “causing people in the transportation industry to feel very concerned.”

The Times’ outlook aside, there is a plan in Congress to provide aid to struggling agencies hit hard by shrinking state and local budgets. T4 America has strongly encouraged Congress to pass the Public Transportation Preservation Act, which would provide $2 billion in emergency operating funds to help keep systems afloat during this crisis of state and local budgets, as the Times noted.

Whether this bill passes or not, Congress must keep the FTA’s sobering numbers in mind when moving to reauthorize the nation’s surface transportation bill. Some will surely ask whether we can afford these investments, but the question we should be asking is how we afford not to make them.

California Supreme Court hands victory to local transit riders and providers

A recent California Supreme Court decision could restore billions in funding for public transportation in the nation’s most populous state.

The Court’s ruling late last week upheld a lower court decision declaring the state’s $3.6 billion raid of public transit funds illegal and ordered that the money be returned to local transit providers.

Two months ago, Transportation for America released “Stranded at the Station: The Impact of the Financial Crisis in Public Transportation,” illustrating the painful cuts transit systems have sustained at the state and local level. The cuts plateaued as unemployment reached 10 percent and Americans were demanding more transportation options, not less.

It is no secret that California has fallen hard as a result of the recession, but the severity of the cuts to public transportation in California was vastly disproportionate to the rest of the country. The reason for this was no mystery: the State was raiding dedicated transit funds every year in order to alleviate other budgetary shortfalls since 2007.

More than two dozen transit providers throughout the state enacted some combination of fee hikes and service reductions, according to our map of transit cutbacks. BART in the San Francisco Bay Area increased its base fare by 17 percent, and many transit systems in Southern California raised fares as much as 20 percent. The County Connection in suburban Contra Costa reduced its bus lines by 23 percent, and rural areas were hit hard as well. The California Transit Association, or CTA, an affiliation of local transit providers, logged 38 agencies facing cuts of some kind in their own version of our transit cuts map.

Last week’s state Supreme Court’s decision helps explain how things got this bad.

Since 2007, Gov. Arnold Schwarzenegger has successfully diverted $3.6 billion from the state’s transit fund to deficit reduction, prompting a lawsuit from the CTA to get the money back. The CTA argued that the raided funds came from gas tax revenues specifically designated for public transit. By refusing to review a lower-court decision in favor of the association, the high court effectively ruled Schwarzenegger’s raid illegal, ending the seizure of desperately-needed transit funds.

This is a huge victory and vindication for local transit providers. Randy Rentschler, director of the Bay Area Metropolitan Transportation Commission, told the San Francisco Chronicle, “everyone knows that the state’s in a budget crisis, but that crisis also exists in local governments in part because the state has taken transit money away from local entities.”

The case has broader implications for public transportation as well.

In tough budget years, Governor Schwarzenegger and the legislature are constantly looking for places to trim and local governments are an easy target. But money saved is not money earned, as local cuts tend to bite the state later through increased demand for social services and counties being unable to meet the basic needs of their citizens. The decision will hopefully lead to more caution.

Most importantly, California can no longer rob Peter to pay Paul.

But at this point, it remains unclear how much of the original $3.6 billion will be returned to the transit fund, and ultimately, to local providers to preserve vital service for riders. That money is desperately needed, not only because of the millions of Californians who rely on public transportation for their day-to-day mobility, but also because many communities are on the cusp of becoming success stories. Transportation for America’s “Stranded” report profiles how efforts in Sacramento, Orange and Contra Counties have already improved quality of life and relieved congestion, highlighting the need to keep up the support.