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Cutting Transit Funding Risks Jobs, Hinders Economic Growth, Say APTA Members

In conjunction with the 2017 Rail Conference, APTA convened a national press briefing with senior public transportation leaders who expressed concerns regarding the Trump administration’s FY 2018 budget proposal to phase out the Capital Investment Grant (CIG) program and cut Full Funding Grant Agreements (FFGA). These moves, if enacted, will jeopardize jobs, critically important public transit projects and state and local economies.

“APTA and its 1,500 members are very concerned about the Trump administration’s FY18 budget proposal to phase out federal investment of public transit programs that are vital to our local communities and millions of Americans,” said APTA Chair Doran J. Barnes, executive director, Foothill Transit, West Covina, CA, who presided at the event.

The press conference featured public transit leaders with broad experience in both the public and private sectors, including three who previously served in leadership positions at U.S. DOT and FTA. Their full remarks are excerpted below. Find the audio here.

These cuts to public transit will impact more than 50 projects in 23 different states worth $38 billion in planned project activity. Of this $38 billion, only $12 billion is the federal funding share for the CIG program.

So again, we have a 35-year history of federal funding for the program. The federal funding share is the minority funding share. State and local governments have historically been carrying the more than 50 percent burden, yet they can’t continue to do it if the federal government is going to pull back on its share. Based on a recent analysis, this would put 800,000 jobs at risk and result in a possible loss of $90 billion in economic output.

Voters around the country want more investment in public transit, not less, and the federal government needs to remain an important funding partner.

— Richard White
APTA Acting President & CEO

With the voters of the Puget Sound region having stepped up to tax themselves, it was incredibly disheartening and frankly mystifying to see the new administration proposed to zero out funding for the very kind of investments that will give people a shot at getting out of congestion.

It’s mystifying that the new president has talked a great deal about the importance of infrastructure and the administration just recently put forward principles to govern some of the things that it wants to accomplish in their new infrastructure package: [A]ward projects that exhibit self-help [and] reward projects that are transformative to the local community. … We’ve been working for years, frankly, with the FTA to move [two] projects along.

Are these projects transformative? We extended our light rail system as part of the U Link program. It was federally funded. U Link extended just to two stops, but they were two of the densest communities in the entire state of Washington, and as a result our light rail ridership spiked 70 to 80 percent.

When the Obama administration came into office, we at DOT honored every project that was started under the Bush administration. And the Bush administration honored every project that came in through the Clinton administration. That is the only way a program like this can work. You cannot plan, design and construct a program in the four-year duration of a single presidential administration.

— Peter Rogoff
CEO, Sound Transit, Seattle
FTA Administrator, 2009-2014
DOT Under Secretary of Transportation for Policy, 2014-2015

[W]e set forth a visionary plan over two decades ago through partnership with the community, the stakeholders, the business sector and state government, working cooperatively with FTA, to build an extension of the BART service into Silicon Valley.

This project has been at the core of transit-oriented development plans and master plans in two counties and four major cities in Silicon Valley, so not funding the second phase undermines that foundation. Not to forget job creation. For every dollar invested, we see a result of $4 to $10 in returns of economic growth and commerce. We cannot realize the full benefits of a regional connection if we’re not able to bring this service into the heart of downtown San Jose.
We are in one of the fastest-growing segments of our nation, and congestion is not something that we just talk about. It’s something that we live with every day, in and out.

During my tenure at FTA, serving as the deputy administrator, I signed over a dozen Full Funding Grant Agreements for rail systems that are currently not only experiencing extensions, but have seen the result and the vibrancy that public transportation brings to communities. [M]any of those systems are in cities where there was only a hope for public transportation. Now they’re not only realizing that dream, but they also are extending it.

— Nuria Fernandez
General Manager
Santa Clara Valley Transportation Authority, San Jose, CA
FTA Acting Administrator, 1999-2001

[T]hree years ago we cut the ribbon for the Green Line connecting our two central business districts from St. Paul to Minneapolis, and those projects today see a weekday ridership of 70,000 passengers. [W]e’ve been tracking what the station area development is within a half mile of each of the stations of our two existing light rail lines, and it’s approaching $6 billion. That is transformative.

[O]ur vision is to double the scope and size of our system. As we’ve been going through our design and engineering processes, we’ve already seen $900 million worth of station area development.

We’re now approaching 20 years in Minnesota’s New Starts partnership with the FTA. They’ve always said to us that they are looking for a stable and reliable funding stream. Well, we need and we depend on their partnership. Without the Capital Investment Grant program to match the $1.6 billion that we have already approved for our two light rail extensions, our projects will not move forward.

When we were in construction for the Green Line, we looked at where all those construction workers’ paychecks were sent. [It] wasn’t just Minneapolis or St. Paul. [T]hose folks resided from the Canadian border to the Iowa border and from the Dakota border even into western Wisconsin. We expect we’ll see similar benefits region-wide, approaching 14,000 workers to actually construct these extensions.

— Mark Fuhrmann
Deputy General Manager, Transit System Development
Metro Transit, Minneapolis

[T]he most urgent infrastructure project in America is at risk because of the loss of federal Capital Investment Grant funding. It’s the Gateway project, which starts with replacing a 106-year-old bridge and a 106-year-old tunnel.

They’ve served us well, but it’s a single point of failure for 10 percent of America’s gross domestic product. In the very spot in the northeastern United States where you need rail capacity the most, it narrows to two tracks.

The good news is that we have a project that’s ready to go today. The portal bridge is 100 percent designed. It’s 100 percent permitted. We have three local funding partners. The only thing we’re waiting for is the federal portion of the project.

We can’t, however, put the full construction contracts out to bid without the federal funding commitment.

[W]e’re actively encouraging private sector input and collaboration and the best ideas around the world to get that tunnel to construction. None of that can happen without federal participation. Consistency, predictability and reliability in our federal partners are paramount to getting these projects built.

This is a sea change that’s being proposed in terms of federal commitment, and what you see represented in front of you today is only a sampling of the projects that will screech to a halt without a federal funding commitment.

— John Porcari
President, U.S. Advisory Services, WSP USA
DOT Deputy Secretary, 2009-2013

In Dallas we’ve already attracted more than $10 billion in transit-oriented development. We’ve leveraged substantial voter-approved local dollars to help secure federal funds enabling us to build the longest light rail system in the country and to convert our bus fleet to clean natural gas.

DART has three projects in various stages of the federal funding pipeline right now. Our light rail platform extension is in the FY17 budget, but we need a contractual mechanism to get the federal funds to Dallas to line up with the overmatch of state funds already committed to us. We also need to build a second light rail line through downtown Dallas. It will be very difficult to build this project without the federal match.

And then the third project is in one of the fastest-growing parts of the entire country. We’re bringing a century-old railroad corridor back to life with our Cotton Belt commuter rail project. This will be partially financed through an FRA Railroad Rehabilitation and Improvement Financing loan. It creates new connectivity to our light rail network, and another rail connection to DFW International Airport, and we’ll have that ready for submission in the spring.

In each of these cases we need to know that the federal government is still ready to work with us.

— Gary Thomas
President and Executive Director
Dallas Area Rapid Transit
APTA Chair, 2011-2012

While we support the administration’s focus on financing and public-private partnerships, there’s a critical difference between financing and funding. P3s and financing can’t replace the federal funding that’s critical to America’s public transit infrastructure projects. Funding is critical to be able to repay financing and attract private sector investment.

Our businesses serving these projects are in small communities across the country. They’re in manufacturing and in the supply of the goods and services needed to build these projects and to equip them. Our jobs are in rural and urban areas, and our employees support Main Street in every district across the country. [B]udget cuts will lead to a loss of jobs in communities across the country, not just in the places where these projects are located.

Our businesses have made investment decisions and provided job training based on a more than 35-year commitment and partnerships—federal, state, local and private—to invest in the nation’s transit infrastructure. And this partnership was reiterated in Congress’ $2.3 billion a year annual commitment made in the FAST Act.

Reneging on that partnership by removing federal funds will have severe impacts. It will force agencies to renege on projects. Direct federal funding must underpin any new initiative. Using the existing public transit program is an excellent way to continue that type of partnership that we count on in our industry.

— Sharon Greene
Senior Vice President, Director Finance Market Sector
HDR/Sharon Greene + Associates

Press conference participants, from left: Fernandez, Furhmann, Rogoff, Barnes, White, Porcari and Greene.

Photo by Mitchell Wood

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