January 5, 2009
|THE SOURCE FOR PUBLIC TRANSPORTATION NEWS AND ANALYSIS
Oberstar Plan Proposes $12 Billion in Transit Funding
U.S. Rep. James Oberstar (D-MN), chairman of the House Transportation and Infrastructure Committee, has released a plan to invest $85 billion in federal funds in the nation’s transportation and environmental infrastructure, including $12 billion for transit and $5 billion for rail. The transit figure includes $7.5 billion in transit urban and rural formula grants, $2 billion in transit energy funding, and $2.5 billion in transit New Starts construction.
The plan cites a December 2008 APTA survey that identified 736 public transit projects, with a total cost of $12.2 billion, that were ready to go to construction within 90 days if additional funding became available. APTA also stated that an estimated $32.4 billion in transit investment projects could be underway within two years. Another survey, by the U.S. Conference of Mayors, identified 628 projects in 427 cities ready to go to construction in 2009, at a total cost of $7.1 billion.
Under the Oberstar plan, states, cities, and public transit agencies would receive transit capital and operating grants for ready-to-go projects according to existing statutory transit formulas, with a requirement that at least half of the funds go to contracts within 90 days of the date of allocation. These investments are projected to create more than 208,000 jobs and $37 billion of economic activity.
The $2 billion included in the transit energy funding provision will use General Fund money for transit operating and capital grants to public transit agencies to meet increased fuel costs and to purchase clean fuel or alternative fuel vehicles. Those projects ready to go to construction that can be underway within 90 days will receive priority.
In announcing the $2.5 billion for New Starts, Oberstar noted that U.S. DOT signed no federal funding agreements for New Starts projects during 2008, although SAFETEA-LU had authorized approximately 300 such projects. Public transportation authorities have many New Starts projects either now under construction or ready within 90 days if additional funding becomes available.
Oberstar’s proposal would distribute the $5 billion in rail funds as follows:
* $1.5 billion for capital grants to Amtrak;
* $3.4 billion for high-speed and intercity passenger rail capital grants to states; and
* $100 million for capital grants to short line and regional railroads.
The Passenger Rail Working Group of the National Surface Transportation Policy and Revenue Study Commission reported in 2007 that the total capital cost for re-establishing the national intercity passenger rail network between now and 2050 is $357.2 billion, annualized at $8.1 billion. Also, U.S. DOT has estimated the demand for rail freight transportation, measured in tonnage, as increasing 88 percent by 2035.
Amtrak, the States for Passenger Rail Coalition, the Midwest Interstate Passenger Rail Commission, and the American Short Line and Regional Railroad Association all have listed ready-to-go rail projects. Amtrak’s alone will cost at least $500 million.
While the final version of a stimulus package won’t be known for some time, transit properties need to take steps to implement job creation projects as soon as the final legislation is approved by the President.
“While the exact amount of funding is not yet known, as most of the money will likely flow through the urban and rural transit funding formulas, all U.S. transit agencies should be preparing now to move quickly once funds are allocated,” said APTA President William W. Millar. “Job-producing projects should be identified and as much preliminary work as possible should be undertaken.”