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McMillan Shares FTA Priorities for 2015

Passenger Transport recently had the opportunity to pose ­several questions to FTA Acting Administrator Therese ­McMillan on topics ranging from the federal investment in public transportation to the FTA’s new safety regulatory authority, P3s, mobility management and workforce development. Her comments follow:

PT: As the demand for public transit rises—fueling the need for more funding—federal investment is flat, a challenge further complicated by the lack of a long-term, multimodal bill. How has FTA’s role in disbursing funding changed, given these circumstances?

Acting Administrator ­McMillan: It might surprise some to know that FTA actually awarded more funding to transit projects in 2014 than in any other year in our history, providing $15.7 billion across more than 2,200 grants. That does include the $3.6 billion to help communities continue recovering from Hurricane Sandy, but even without that significant boost, 2014 would still have been a record-setting year for federal transit funding.

That’s possible, in part, because we’ve streamlined our own processes for Capital Investment Grants (New Starts, Small Starts and the new Core Capacity grants) to help projects get started and finished quicker.

The point of your question remains, though: We can work to get funding out more efficiently, but it’s still the same total amount of funding. More importantly, it comes with a lot of uncertainty. Over the last six years, Congress had funded transportation through 28 separate short-term measures. That kind of uncertainty has the same effect on transportation planning that it does on Wall Street—constraining vision and discouraging the industry from taking risk and pursuing innovation.

PT: One strategy for partially addressing the long-term financing challenge is to strengthen public-private partnerships. What are FTA’s leading policy- and program-related initiatives?

McMillan: To meet growing demand, we’ll need both sustained investment from federal, state and local governments and more participation from the private sector. Our goal is to offer a variety of tools that help project sponsors leverage federal funding because each project is going to be different.

TIFIA provides secured direct loans, loan guarantees and lines of credit for transportation projects of national or regional significance, and each dollar of federal funds can provide up to $10 in TIFIA credit assistance and leverage $30 in transportation infrastructure investment. MAP-21 increased TIFIA significantly and streamlined the application process.

We’re also exploring joint development as an approach that helps projects capture revenue that can, in turn, be used to offset capital and operating expenses. We’ve published our first Joint Development Circular to better define the kinds of activities that are eligible and costs that are attributable to joint development are now treated favorably when competing for Capital Investment Grants. We’re interested in supporting other forms of value capture that can help private developers succeed and get innovative transit projects up and running.

PT: Circling back to MAP-21, please share an overview of FTA’s progress to implement the new safety regulatory authority granted by the legislation, especially regarding FTA’s risk-management resources.

McMillan: As you know, MAP-21 provided FTA with significant new safety authorities. We’re implementing that new responsibility with two main goals in mind: to make a safe mode of travel safer and to avoid a one-size-fits-all approach in favor of flexible systems that match the needs of transit providers at vastly different scales of operation.

FTA has a big year planned for safety in 2015. During these next 12 months, we plan to issue several Notices of Proposed Rulemakings (NPRMs) related to safety, and we’ll need the input of the transit industry to produce the best result. That’s why we’re committed to keeping transit agencies informed at every opportunity, so that those NPRMs will lead to sound safety policy, create more efficient practices for risk management and shape an even stronger safety culture at every transit system.

As a key element of the FTA’s Safety Management Systems (SMS) program, we’re developing a safety risk management framework. Keep an eye out for training sessions offered both at APTA events and though our own SMS training.

PT: Please share a few thoughts regarding how FTA will transition into safety as the regulations come online, when you expect the key rules to become final, and what suggestions you have for public transit agencies to prepare for the new safety regime in advance of the ­formal rulemakings.

McMillan: As we prepare for a series of NPRMs, our Transit Advisory Committee for Safety (TRACS) working groups continue to meet on major safety issues and will issue recommendations in the fall. TRACS brings together a diverse set of safety and transportation experts from the transit industry, advocacy organizations, labor unions and academia to provide recommendations to the FTA administrator and the secretary of transportation. The NPRMs also suggest that transit agencies adopt the principles of safety management systems and learn more if they don’t already have a SMS in place.

Early in 2015, FTA will issue a call for participation in an upcoming SMS pilot program for both bus and rail agencies of all sizes, and we’ll need volunteers to participate and ultimately pioneer best practices for the industry. Collectively, these SMS pilots will provide transit agencies with tools for earlier detection and more effective management of risk. We will have the ability to work with you hand-in-hand to enhance your safety competencies and capabilities. Also register for available safety training courses. Many courses have now been updated to include SMS concepts. Check the FTA website for more details.

PT: What are your thoughts regarding how public transit agencies can become more engaged in the regional decision-making process and better understand the benefits of participating in regional multimodal transportation plans?

McMillan: MAP-21 for the first time guaranteed transit agencies a seat on MPO boards, and we need more of them to take advantage of that. By taking that seat at the table, you can make sure that the requirements and resources of transit providers are part of the equation. Beyond that, building regional relationships is increasingly important to take advantage of federal funding.

Demonstrating a high-level of regional cooperation is of great benefit when you’re applying for FTA’s discretionary grants, and many of the transit projects we see moving forward today with federal funding have some multimodal component to them, whether that’s a vast undertaking like Denver’s Union Station redevelopment or a new multimodal center in downtown Mans­field, Connecticut. We’re also seeing non-traditional sponsors winning grants for transit projects through programs such as TIGER and they need strong partnerships with transit providers to make them work.

PT: You’ve been a strong advocate of mobility management, including supporting the National Center for Mobility Management and its role in advancing health, economic vitality and self-sufficiency for all. Please offer your perspective of the nexus among access to health care, wellness and public transportation.

McMillan: I often say that public transportation is about building ladders of opportunity, and the way it connects people to health services is a prime example of that. In fact, the Affordable Care Act has provided health insurance for many people who could never afford it before, but if they can’t get to the doctor for regular preventive care, it will have limited effect in improving their health. So one important link between transit and wellness is simply that it connects people who depend on transit with health services. We see in places like Cleveland, Orlando and El Paso that healthcare providers including major hospitals often adopt and vocally champion public transportation for their patients and their employees.

We also know how important access to healthcare is for older Americans to continue living independently. That’s one reason that when the AARP surveyed seniors on amenities they most wanted close to home, the number one response was a bus stop—[it’s] even more important than a grocery store or a pharmacy. Transit helps seniors whose mobility may be declining continue to live a healthy, independent life.

There’s also a link between transit-accessible cities and general wellness. A major reason may be that transit extends the walkability of neighborhoods. Many of our investments in transit include improvements to sidewalks, overpasses and bike access. That in turn encourages people to use those forms of active transit that are good for the body and the mind.

PT: Regarding the U.S. investment in infrastructure—which lags many other developed nations—you’ve said that “when you’re already behind, every day—and every dollar—matters.” Please share your thoughts about how fully funding public transit’s backlog of improvements can help restore our global competitiveness.

McMillan: The U.S. has the largest economy in the world, but right now we rank 28th in infrastructure investment. European nations, on average, invest 5 percent of their GDP in infrastructure; the United State invests only half as much. Good ideas and hard work are only going to take us so far without the ability to move goods to market and people to jobs.

Transportation is the backbone of our economy. But infrastructure, no matter how well it’s built, does not last forever, and we’re falling behind compared to the rest of the world.

Transit is just one of the components of our transportation system, but it’s a critical one because it helps connect business and labor. We often talk about helping people get to their jobs efficiently because that’s vitally important to their families and their quality of life. It’s equally important, though, to say that we get workers to the businesses that need them, and without whom they can’t succeed or expand. In Atlanta, for instance, a University of Georgia study found that out of the 18 fastest-growing economic sectors, 14 of them are ones whose workers heavily depend on the city’s public transportation system to get to and from work. So in Atlanta, and across the country, it’s clear that our capacity to grow economically is linked to—and will be limited by the absence of—a robust public transportation system.

That’s why transit’s $87 billion backlog in repairs and maintenance—and number that grows by $2.5 billion a year—is a drag on our global competitiveness.

PT: One more question about public transportation’s role in the ­economy—please share a few thoughts about the industry as a jobs engine and FTA’s efforts to help build public transit’s workforce.

McMillan: There’s no doubt that transit itself has been a ladder of opportunity for the women and men who’ve gained lifelong, family-supporting careers in the industry. Growing demand for transit means that it will continue to be a source of good jobs in the future. In fact, even if we had all the funding we could wish for to repair and expand our physical infrastructure, we’d still need enough people with the right skills to operate and maintain it.

We’re challenged on that front from two directions: the retirement of employees who have decades of experience and the constant need to keep the skillsets of transit workers up-to-date to match new technologies. To help meet those challenges, the Obama administration has proposed increasing workforce development for transit by ten-fold and to apply the lessons we’ve learned from our existing workforce development programs.

PT: How can the industry further raise awareness among all Americans—including non-riders—of public transit’s value to their communities and the nation as a whole?

McMillan: I think that there is a great deal of awareness in our country of transit’s value. As I’ve said, we are seeing record ridership and growing demand, and I think that the American public is embracing transit’s potential to improve their lives and their community on several levels—personal mobility, economic development and environmental sustainability.

The American people are ready for more infrastructure investment and a bold path forward on transportation improvements. I look forward to working with Congress to turn the public’s wishes into reality.
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