United States General Accounting Office Resources, Community, and Washington, DC 20548 Economic Development Division B-283676 October 15, 1999 The Honorable Phil Grarnm ChairmaIl The Honorable Paul S. &banes Ranking Minority Member Committee on Banking, Housing, and Urban &%irs United States Senate The Honorable Bud Shuster Chairman The Honorable James Oberstar Ranking Democratic Member Committee on Transportation and Jnfr&ructure House of Representatives Subject: Mass Transit: “Mobil&v Improvements” Is One of Many Factors Used to Evaluate Mass Transit Proiects Since the early 197Os,the federal government has contributed large sums to the nation’s capital investment in urban mass transit. In the 5 years prior to April 1999, for example, the Department of Transportation’s (DOT) Federal Transit AdmirWration’s (FI’A) %ew starts” program-which funds major new rail, bus, and trolley transit projects using separate and exclusive rights of way-has provided state and local transit agencies with about $3.8 billion to help design and construct such projects nationwide. The Transportation Equity Act for the 21” Century (TEA-21),’ enacted in June 1998, authorizes $8.2 billion for new starts transit projects through l&al year 2003. As required by that act, we reported in April 1999 on FIX’s processes and procedures for evaluating, rating, and recommending new starts transit projects for federal funding. * The act requires FI’A to issue regulations describing how it considers new starts project criteria for overall project ratings. TEA-21 also required us to review “mobility improvements”-one of the factors considered in Fl’A’s evaluation of “new starts” projects. FI’A measures mobility improvements in terms of the amount of time potential projects will ‘P.L. 105178. 'Mass Transit: FTA’s Proaess in DeveloDing and ImDlementim a New Starts Evaluation Process (GAO/WED-99- 113, Apr. 26, 1999). GAOIRCED-00-6R Mass Transit Projects B-2836'i6 save q*stem users and other commuters and the number of low-income households potential projects will serve. As agreed with your offices, this report describes how FTA currently considers mobility improvements as it evaluates proposed new starts projects. This report also discusses (1) how a proposed project’s rating for mobility improvements affects its likelihood for selection and (2) FTA’s proposed changes in how it will evaluate mobility improvements. How PTA Considers Mobil& Imurovements When Evaluating ProDosed New Starts Proiec- TEA-21 requires that, before FTA may approve a grant or loan for a proposed new starts transit project, it must evaluate the project in a variety of ways, including its operating and capital finance plans and the mobility improvements, environmental benefits, and projected cost-effectiveness and operating efficiencies associated with the project. As shown in figure 1, FTA organizes these various criteria into two separate categories: local financial commitment and project justifxation. Mobility improvements is one of several project justi5cation criteria Figure 1: FTA’s New Starts Evaluation and Rating Process The local share is the percentage of a project’s capital cost to be funded from sources other than new starts funding. “According to FTA, this optional criterion gives grantees the opportunity to provide additional information about a project that may contribute in determintng the project’s overall success. Source: FTA To help develop a proposed project’s overaH rating, FIX, based on documentation submitted by project sponsors, assigns a descriptive rating of high, medium-high, medium, low-medium, or low to each criterion including mobility improvements. Once the individual criterion ratings are completed, FTA combines them to develop summary project justification and local financial commitment ratings. FX’A then combines the project justification and financial commitment summary ratings to assign an overall project rating of highly recommended, recommended, or not recommended. To receive the highly recommended rating, a project must have summary project justification and local financial commitment ratings of at least medium-high. To receive a rating of recommended, the project must have summary ratings of at least medium. A project is rated as not recommended when either SummaIy rating is less than medium3 ?or a complete description of FIX’s new starts evaluation and recommendation process, see our Apr. 26, 1999, report. 2 GAOLRCED-00-6R Mass Transit Projects B-2836Ti6 FTA evaluates the proposed improvements for mobility by reviewing two measures-travel time savings and the number of low-income households served.J The first measure reflects the total travel time savmgs anticipated from the new starts investment compared to other alternatives. This includes the travel time savings for new and existUg transit riders as well as people using competitive modes of travel such as personal automobiles. Because TEA-21 directs FI’A to “not consider the dollar value of mobility improvements” in assessing new starts projects, FTA evaluates the sum total of the estimated hours saved (or increased) by commuters and others affected by each proposed project. In order to compare projects, FI’A normalizes the measure by each project’s annual capital cost, which results in a measure of hours saved per dollar of capital cost. The second mobility improvements measure reflects the absolute number of low-income households- defined as households below the poverty level-located within a half-mile of a proposed project’s boarding points, or stations. As it does with the time savings measure, FI’A normalizes this measure by each project’s annual capital cost, which results in a composite measure of persons served per dollar of capital cost. FI’A then ranks the projects according to both of these mobility improvements measures and assigns, for each measure, a high, medium-high, medium, low-medium, or low rating based on the projects’ relative rankings. These ratings are then combined (with greater emphasis on travel time savings) to assrgn an overall mobility improvements rating. Hiti Mobilitv ImDrovements R&ina Does Not Guarantee Proiect ADDrOVd Because FI’A considers numerous criteria in determinin g a project’s overall rating, a rating in any one criterion cannot be used to absolutely predict FTA’s fmal dete rmination with respect to a particular project. As a result, some projects that are rated high or medium-high for mobility improvements will not receive a rating of recommended. PTA’s Director for Policy Development told us that some proposed new starts projects could receive high ratings for improving mobility but not receive a rating of recommended because their financial commitment packages are not yet completed. He also told us that he would expect to see a fairly strong correlation between a project that receives an overall rating of recommended or highly recommended and its individual criterion ratings, because most projects that receive a rating of recommended or higher are thoughtfully conceived, well-planned, and well-managed projects and thus receive high scores across all criteria Of the 19 projects that FI’A rated as recommended or highly recommended in its fiscal year 2000 new starts report, 15 received a medium or higher rating for mobility improvements. Only four received a low rating or medium-low rating. Conversely, of the 20 projects that were not recommended, 14 were rated low or medium-low for mobility improvements. FTA Is Considerinn Some Chances to Its Mobilitv ImDrovements Rating According to an Fl’A official, the agency is considering several changes that would better address mobility improvements for low-income households as part of its regulations on the entire new starts evaluation process. DOT issued, in April 1999, a notice of proposed rulernaking describing how FTA considers every new starts project criteria, including mobility improvements, to establish overall “The measures for each project jusufication criterion were proposed by FTA in 1994 and became final in 1996, after FI’A circulated its proposed new starts evaluation policy for comments to interested parties, including state and local govemrnents, transit agencies,metropolitan planning organizations, and consultants. As a result of the comments received, F’IA adopted the criteria measures currently in use. 3 GAO/RCED-00-6R Mass Transit Projects B-283676 project ratings.’ DOT received 41 comments, of which 24 contained either a general or specik comment directed at how FI’A considers mobility improvements. Some of these comments were directed speczcally at how the current evaluation process considers the mobility of the low-income households to be served by the proposed project. Several commenters stated that the number of low- income households within one-half mile of the system’s boarding points was an inadequate measure of a proposed project’s improvements to mobility. FTA expects the final regulation to be implemented in time to be used to prepare its fiscal year 2002 report on new starts funding to be issued in February 2001. For the fiscal year 2001 annual new starts report due in February 2000, FI’A will use the existing process. Apencv Comments We provided a draft of this report to DOT for review and comment. We then met with J?I’A’s Director for Policy Development. FTA agreed with the report’s information and provided a minor clarification, which we incorporated. ScoDe and Methodoloev To address the-mobility improvements issues in this report, we reviewed the legislation governing new starts transit projects, FI’A’s fiscal year 2000 new starts report, its technical guidance on the new starts criteria, and comments on the notice of proposed rulemaking for the new starts evaluation process. We also talked with FIX’s Director for Policy Development. We performed our work from August through October 1999 in accordance with generally accepted government auditing standards. We are sending copies of this report to the Honorable Rodney E. Slater, Secretary of Transportation; the Honorable Gordon Linton, Administrator, Federal Transit Admmistration; the Honorable Jacob Lew, Director, Office of Management and Budget; and other interested parties. We will make copies available to others upon request. Key contributors to this report were Jack Bagnulo, Carol Ruchala, and Ron Stouffer. Please call me at (202) 512-2834 if you have any questions about this report. Phyllis F. Scheinberg Associate Director, Transportation Issues ‘64 Fed. Reg. 17062, (Apr. 7, 1999). 4 GAO/ECED-00-6R Mass Transit Projects Ordering Information The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and Mastercard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. 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Mass Transit: 'Mobility Improvements' Is One of Many Factors Used to Evaluate Mass Transit Projects
Published by the Government Accountability Office on 1999-10-15.
Below is a raw (and likely hideous) rendition of the original report. (PDF)