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Below is the second of several position papers we will be forwarding in the next several days which I received at the APTA legislative committee meeting last week in Washington D.C. This paper is DRAFT: APTA POLICY PROPOSAL, FINANCING SAFETEA-LU REAUTHORIZATION and a recent APTA Resolution regarding funding issues.
Pictured: DC Circulator bus
BECAUSE OF THE LENGTH OF SOME OF THESE MATERIALS WE ARE SENDING SEVERAL EMAILS AND NOT JUST ALL ITEMS IN ONE. |
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DRAFT
APTA POLICY PROPOSAL: FINANCING SAFETEA-LU REAUTHORIZATION
With the Highway Trust Fund facing insolvency as early as FY 2009, and its Mass Transit Account not far behind, and in the face of documented and substantial unmet transit and highway infrastructure needs, the American Public Transportation Association (APT A) proposes -
~ Indexing the federal tax on motor fuels to inflation on a permanent basis including a one-time "catch up" component to recognize losses to inflation.
~ Encouraging innovative financing mechanisms to supplement that federal gas tax funding, including public/private partnerships, tolling, and other mechanisms provided public transit gets a fair share.
~ Preserving the "guarantees" that assure authorized funds are appropriated each year which have supported the long range planning, financing and leveraging of the transit and highway programs across the nation since 1998.
Background
Federal role in transportation. The federal role in transportation in the U.S. has been evident from the birth of the nation. In President Washington's Administration, canals and postal roads were the focus of national transportation efforts. In the mid-19th Century, President Lincoln, a former railroad lawyer, supported the expansion of the railroads across the nation and the federal role in "internal improvements" - roads and bridges that was critical to the country's growth. In the mid-20 Century, President Eisenhower created the interstate highway system funded from a federal gas tax which led to the economic expansion of the country. More recently, President Reagan raised the gas tax - and for the first time allocated twenty percent of the increase to public transportation - thereby recognizing the importance that transit and highways play in the national economy. More recent transit and highway reauthorization legislation in the 1990s has
emphasized the multi-modal nature of the federal program, and provided guarantees that assure that authorized funds are made available through the appropriations process.
As Congress and the Administration begin the process of reauthorizing highway and transit legislation, it is important to emphasize the continuing significance of the federal role in transportation. Transit provides mobility to millions of Americans, spurs economic development on a large scale, reduces energy consumption, and creates jobs across America. Moreover, significant demographic changes - the growing number of older Americans and immigrants - will continue to create demand for transit servIces.
Unmet surface transportation infrastructure needs. For our surface transportation infrastructure system to continue to provide its competitive edge, substantial federal and state investment is necessary. Some $400 billion in public transportation assets have been financed in part with federal transportation investment. The most recently available AASHTO Bottom Line report documents unmet transit needs of $43 billion a year; other studies confirm that figure. Other nations recognize the need to stay competitive through healthy infrastructure: China essentially is building a new subway system a year.
Federal resources for surface transportation. Much will be said and written about the need for new revenue sources beyond the federal tax on gasoline to fund our nation's transit and highway systems. Indeed, a recent Hudson Institute study makes this point (2010 And Beyond: A Vision of America's Transportation Future) but also concludes that "[u]ntil that transition has been made, Congress should immediately index and increase the existing federal motor fuel tax." A 2006 Transportation Research Board report, The Fuel Tax, makes the same point about the need to increase the existing motor fuel tax.
APT A agrees. We believe the federal tax on gasoline remains the best resource to finance the reauthorization of SAFETEA-LU. As noted economists Robert J. Shapiro and Kevin A. Hassett have written, "relying on fuel taxes to support highways and transit is sound economics." (Healthy Returns: The Economic Effects of Surface Transportation and Motor Fuel Taxes. 2004).
Implementation. Many independent observers have stressed the importance of keeping the cost of a gallon of gasoline at a certain level to spur innovation, conservation and use of other energy resources. The gas tax can help achieve this purpose, and can do so in a relatively painless way if the gas tax increase is implemented at a time of falling oil prices so that its impact is minimal.
Innovative financing mechanisms. At the same time, APT A recognizes the need to support a range of innovative financing mechanisms from tolling to public/private partnerships - to supplement gas tax resources. In any such efforts, public transportation should be treated equitably.
Preserve the guarantees. Finally, the "guarantees" that have made all authorized funds available through the TEA 21 and SAFETEA-LU reauthorization cycles should be maintained. These provide an assured flow of federal funding thereby permitting the leveraging of them at the state and local level, increasing the overall financing stream.
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RESOLUTION REGARDING THE URBAN PARTNERSHIP CONGESTION INITIATIVE AND FISCAL YEAR 2007 BUS AND BUS FACILITIES FUND
Approved by APT A Executive Committee
November 16,2007
The American Public Transportation Association (APT A) is supportive of innovative initiatives and new proposals such as the Urban Partnership Congestion Initiative. However, we register our strong disagreement with the U.S. Department of Transportation's (U.S. DOT) persistent efforts to finance its Urban Partnership Congestion Initiative and the newly proposed Congestion Reduction Demonstration Initiative with funds authorized and appropriated for the Federal Transit Administration's (FTA) Bus and Bus Facility program and New Starts/Small Starts program.
APTA strongly objects to the U.S. DOT's decision to divert $438 million in FY 2007 Bus and Bus Facility program funds to the Urban Partnership Congestion Initiative. That funding represented almost the entire amount of discretionary grant funds made available to the FT A by Congress in the FY 2007 Continuing Appropriations Resolution (PL 110-5) for Bus and Bus Facility grants.
APTA strongly supports language in the conference report on the FY 2008 Transportation Appropriations bill approved by Congress which limits the U.S. DOT's authority to finance its Urban Partnership Congestion Initiative with funds appropriated for the Bus and Bus Facility program.
APTA strongly objects to the U.S. DOT's proposal, announced in the November 13, 2007 Federal Register, to finance a newly proposed Congestion Reduction Demonstration Initiative with funding appropriated under the FY 2008 Transportation Appropriations bill for authorized transit programs. Funds under the Bus and Bus Facility program are historically distributed to hundreds of transit agencies across the country to address widespread capital needs. Grants under both the Urban Partnership Congestion Initiative and the newly proposed Congestion Reduction Demonstration Initiative were not authorized under the Safe, Accountable, Flexible, Efficient Transportation Equity Act - A Legacy for Users (SAFETEA-LU) and are being made without clear statutory authority or under the established project development process.
Additionally, APT A believes DOT's deviation from the normal grant-making processes threatens the predictability, stability, and reliability of the federal transit program. By selecting these projects outside the normal grant application and review process, DOT has detrimentally bypassed the checks and balances inherent in that process. The projects selected obligate significant federal dollars without the benefit of risk or cost benefit analysis otherwise required.
Finally, APTA believes this new program requires affirmative legislative authorization and that any similar program, regardless of its title, should not be implemented until such authorization is enacted. APT A believes the Administration's action in this matter was contrary to Congress' intent, expressed in SAFETEA-LU, to make Bus and Bus Facility grants available to transit agencies to replace and improve rolling stock and facilities and develop New Start and Small Start projects. The Administration's use of Bus and Bus Facility funds in FY 2007 was also inconsistent with the grant solicitation process that was published in the Federal Register. APTA believes that, should the Administration desire to continue or expand the Urban Partnership Congestion Initiative or the Congestion Reduction Demonstration Initiative, it should work with Congress to provide new funds for the program, rather than take funds from existing, authorized accounts. In any such program, DOT must acknowledge the significant contributions of transit to congestion relief and provide reasonable funding to transit projects to accomplish such relief.
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R.E. "Tuck" Duncan, Executive Director,
Kansas Public Transit Association | |
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