The actual balance sheet is worse, of course, as the $484 million figure does not include operating costs.  Despite charging $6 fares to pay off a $100 million federal loan, an additional subsidy — on the order of $9.85 per ride, compared to $1.95 for a bus rapid transit project — would be required given current passenger traffic levels at the airport.  In short, public dollars are being “invested” in a way that pointlessly maximizes future costs. The fact that $95 million has already been consumed, while certainly interesting given how little there is to show for it, is immaterial when evaluating whether that additional ongoing cost is a worthwhile one to bear.  (Comments)

Is the OAC dead? While I’d love to say “yes,” in good conscience I can only say the answer here is “no” — or, at the least, “not yet.”

BART is of course convinced, or at least puts on a brave face, that the project is not dead.  The agency’s commitment remains steadfast, we are told, as though abandoning the project at this late stage would dishonorably betray the trust of the public.  (Quite the opposite.)  This reaction, while predictable, is disappointing.  Rather than take a step back to reevaluate the mistakes of the past year; rather than internalize FTA’s comments and take them to heart; rather than work with the community to cooperate on a mutually beneficial solution — BART evinced bitterness and indignation when things did not go its way.  BART, which for so many people is the face of public transportation in the Bay Area, should, perhaps more than any other transit agency, go out of its way to embody the compassionate values of this region.  That the Bay Area’s most well-known transit agency would claim it had acted in full compliance with the Civil Rights Act when it, in fact, had not — all while allegedly acting in the name of public benefit, and while spending public dollars — is, quite frankly, embarrassing for this native of the Bay Area.

No Stimulus Funding For You

BART’s reaction also does a disservice to the public by downplaying and masking the actual severity of the defeat that the Connector was dealt.  Although FTA’s recent exchange with BART specifically focused on the $70 million of ARRA stimulus funding (on account of its more immediate deadlines), a local agency that is not in full compliance with federal law is not entitled to receive any federal monies until it brings itself into compliance.  Or, stated differently, a federal agency like FTA may not fund a local agency that is known to be in violation of federal law.  Depending on the exact timeline of BART’s Title VI corrective plan, this implicates not just the $70 million ARRA, but also $104 million of other federal money needed for the OAC, including a $79 million TIFIA loan.  That means that 35% of the $492 million total project funding is implicated.

A smaller defeat, but a defeat nonetheless, came in the form of the TIGER grant funds that were announced last week.  Remember when we talked about this last summer? MTC studied some Bay Area projects, matched them to the federal criteria for the TIGER program, and produced a short list of $133 million worth of requests for the TIGER funding.  Two of the four projects were associated with BART: a $5 million payment toward the Airport Connector’s TIFIA loan, along with a separate request for expanding the Hayward Yard.  Both BART projects were denied TIGER funding (not surprising, given the timing of the Title VI complaint).  The other two Bay Area projects, however, both received TIGER funding.  Doyle Drive received $46 million, and the Green Trade Corridor (linking the Ports of Oakland, Stockton, and West Sacramento) received $30 million.

FTA Turns Next to MTC

The Title VI complaint filed against the Airport Connector may have opened a “Pandora’s Box” of more far-reaching implications.  Cheryl Hershey of FTA sent a letter addressed to MTC, dated February 3, 2010 (see pages 6-7 of this PDF).  That letter indicates that FTA has broadened its oversight of Bay Area transit funding to include not just BART, but also MTC.  After all, MTC has repeatedly proven itself more than willing to fund the Airport Connector, oblivious and/or indifferent to any Title VI deficiencies.  Why did MTC, before eagerly dishing out federal funds to a project that was ineligible to receive them, not do its due diligence on the Airport Connector? Or for that matter, any of the projects that it funds?  Inquiring minds at FTA want to know:

As you are aware, BART is a subrecipient of the MTC, and, therefore, MTC is responsible for ensuring its subrecipients comply with Title VI . . . .  Your agency is responsible for documenting a process that ensures that all MTC subrecipients are in compliance with the reporting requirements of FTA . . .

The fact that BART has not conducted the necessary service equity analysis for the OAC project or fare equity analysis raises concerns that your agency does not have procedures in place to monitor its subrecipients.

FTA goes on to request that MTC document its Title VI procedures within 30 days.  Is the comedy of errors still unfolding?

The Battle

In short, there is no doubt that the denial of this stimulus funding is an important victory.  The OAC is now not eligible for federal funding, and the poor state of the economy has diminished additional local and state funding sources on which the OAC might otherwise rely.  That means that the project is, at least, postponed.  Urban Habitat, TransForm, Genesis, and last, but certainly not least, Public Advocates, who prepared and filed the initial Title VI complaint with FTA, deserve all of our gratitude and appreciation.  These local organizations persevered throughout one year of countless government meetings, each one seemingly more frustrating than the last, but never giving up so as long as another avenue for advocacy was available.

Their commitment to social and environmental justice, in a field that sometimes escapes mainstream attention — not the luxury, but the basic right of people, no matter their race or income level, to have access to a dependable and dignified means of transportation — is inspiring.  Their months of hard work deserve credit, because a denial of this sort does not just fall magically from the sky (or in this case, Washington DC).  It happens because real people, who are committed to a cause, put in real time to research and follow up on an opportunity, even if it seems like a long shot.  That is what happened here, and it clearly paid off.  Needy, cash-strapped agencies will now have $70 million available to use for projects that will put people to work, while more tangibly improving transit for people throughout the Bay Area.  That’s a great thing.  When it comes to the battle for the stimulus funding, there is not a shred of doubt that the transit advocates handily won.

The War

But what about the war? Not just for the OAC, but also for other megaprojects that ring up a large tab while falling short on function?  It’s extremely difficult to stop projects like this, in large part because they are propped up by deep roots — mechanisms of institutional support that are never printed on the pages of a government report, nor aired in the public halls of a government meeting.  And even if one project were, by some miracle, to be stopped, several others are queued up right behind it, waiting patiently for funding as they have waited in years past.  These projects have effectively been promised to constituents for decades, so there is an expectation that they will eventually be built, even if it does take a very long time.  Changing that underlying modus operandi is difficult, because it cuts to the decisionmakers themselves and their political connections, as well as the culture of a prevailing political, business, and administrative complex.  In other words, it goes far beyond denying one source of funding for one project.

Hearing of BART’s continued commitment to the Airport Connector, and knowing the history of MTC and BART, I would not be surprised if down the road we see the OAC — that proverbial cat with nine lives — come back from the dead yet another time.  In fact, I would be more surprised if we didn’t see it return.  The OAC was thought to be laid to rest on previous occasions, only to be revived, as it was revived in 2009 by the stimulus.  There is also no doubt in my mind that MTC will thoroughly review every last transportation funding program offered at every level of government, and every last pot of money — looking for what, exactly?  In persistent search of obscure conditions and loopholes, just to find a way to shift around enough money to refill the Airport Connector’s freshly-opened capital budget hole, substantial hole though it may be.  What initially seem like neutral pots of money take on a life and significance of their own.  This is just what MTC does, and it will do so here.

Then again, a few years ago, I would not have guessed that federal stimulus dollars would become available, nor would I have guessed that the Connector would ultimately be denied that funding because of a Title VI violation.  But the ingenuity and creativity of our local organizations showed us otherwise.  Despite the history, maybe you really never know.

So, is the Oakland Airport Connector dead? While I’d love to say “yes,” in good conscience I can only say the answer here is “no” — or, at the least, “not yet.”

Since my letter of January 15, FTA staff and BART have worked diligently but unsuccessfully on the development of a corrective action plan that might be acceptable.  I am require to now inform you that your plan is rejected.  I ask that you immediately get in contact with Region IX Administrator Leslie Rogers for the purpose of pursuing alternative projects for the Bay area that can be obligated prior to the March 5 deadline.

Rogoff goes on to explain that the $70 million of ARRA stimulus funds cannot be disbursed to the Oakland Airport Connector.  In order to receive that funding, BART would have to bring its practices into compliance with Title VI before September 30, 2010, and it was clear to both BART and FTA that there was simply not sufficient time to do so:

I am required to reject your plan for the following reasons.  Based on the timelines submitted by BART, there is no way the agency can come into full compliance with Title VI by September 30, 2010.  The requirements of ARRA dictate that any funds not disbursed by September 30, 2010, must be lapsed back to the Treasury.  And since I cannot allow BART to draw any funds for the OAC project prior to coming into full compliance, it is clear that pursuit of the OAC project would result in the funds either being reallocated out of the Bay Area or lapsed.  Both scenarios are unacceptable to me as I am sure they are to you.  Let me say that, based on FTA’s experience in other cities, BART is being realistic in admitting that the process of coming into full compliance will take considerably longer than the 8+ months that remain before the September 30 deadline.  I appreciate and respect your honesty in this regard.

The announcement means that the Oakland Airport Connector is not eligible for critical federal funding that BART needs in order to construct the project.  MTC had previously planned to evaluate BART’s proposed Title VI action plan at a special meeting on February 17, but now that the FTA has rejected BART’s plan, even the Commissioners will finally have to consider alternative uses for the $70 million of ARRA funding.  It is critical that this stimulus funding remain in the Bay Area.  Rogoff’s letter implies that there will be time to do so, if MTC acts now to approve an alternative funding plan:

Given this sitaution, and the fact that we are now only 3 weeks away from the March 5 deadline, I must bring these discussions to a close so that we can work together to ensure that the ARRA funds can create and preserve jobs in the Bay area.

The alternative funding plan (PDF) is the same plan that transit advocates have heartily supported for the entire past year, namely, to distribute the $70 million to transit agencies for system preservation and preventive maintenance purposes.  The funding includes almost $17 million for BART, $17.5 million for Muni, $6.7 million for AC Transit, $12.3 million for VTA, $2.7 million for Caltrain, $2.4 million for Golden Gate, and about $2 million for SamTrans, as well as funding for small operators.

We have yet to hear an official response from BART about Rogoff’s letter.  My sincere hope is that BART, upon seeing that a large hole has been opened in the OAC’s capital budget, will finally be willing to take public comment seriously and cooperate with the community — by scrapping this ineffective, bloated elevated Connector and replacing it with a more cost-effective enhanced bus.  Should BART choose to do so, a considerable amount of local money that has been reserved for the OAC could then be reprogrammed to other, more useful Bay Area projects.

It is extremely gratifying that FTA was receptive, not only in hearing the concerns of transit advocates about the troubling social justice implications of the OAC, but also in acting swiftly and definitively on this matter.  And when MTC officially reprograms the funding, it will also be gratifying to see our region’s cash-strapped transit agencies — reeling as they are from a death spiral induced by the State’s theft of transit monies — get some relief.

Last year, BART promised to MTC and the Bay Area that it could deliver a shovel-ready OAC on the fast-paced federal stimulus timeline.  Implicit in that promise is that BART would do so in full compliance with applicable laws and regulations.  That, as we know, has not quite worked out.  BART betrayed not just MTC’s trust, but also the public’s trust — for it neglected to carry out required Title VI analysis, while moving at breakneck speed to stick to the schedule.  In the process, BART misrepresented the project’s “benefits” — for example, stating at public meetings that the Connector might produce up to 15,000 jobs, but only committing to a few hundred jobs when putting it down in writing to the federal government.  It shut out and attempted to actively discredit the valuable, well-reasoned concerns expressed by the community and advocacy groups — concerns that BART is now forced to confront, since they were directly echoed by FTA when FTA withheld the $70 million of ARRA funds pending BART’s completion of the Title VI equity analysis.  As we’ve discussed, that $70 million would be completely lost to the Bay Area if BART cannot submit by March 5 a plan that is to FTA’s satisfaction.

But MTC is implicated here, as well: for MTC’s charge is not to build the Airport Connector, nor is it to fulfill BART’s every wish.  Its charge is to program transportation dollars that are made available to the region.  Because the Bay Area plans to build and operate more projects than it can currently fund, that charge necessarily includes making sound use of any and all monies that become available — particularly monies over which MTC is granted a measure of discretion.  And that means holding tight onto the $70 million and allocating it smartly, rather than gambling it away on the OAC.

Going into yesterday’s meeting, MTC faced two action options, irreverently summarized below:

• Option 1: There are dozens of construction workers rallying outside right now and filling up this auditorium, and BART did promise that this project would create thousands of jobs.  So let’s not desert the OAC quite yet.  Instead, let’s wait until mid-February, and see what BART comes up with.  Never mind that the longer we wait, the more risky it gets that the Bay Area will lose the money.  After all, we have been talking about the OAC for decades, so what’s two more weeks?
• Option 2: Enough is enough.  We gave BART its chance, but it’s just too risky that we’ll lose the $70 million.  Bay Area transit agencies are seriously hurting because Sacramento has basically abandoned them, and they need our help (and yes, that includes BART itself).  Anyway, operating transit provides jobs too.  Allocate this money immediately to the Tier 2 projects, so that the transit agencies can use the money for system preservation and ease ever-widening budget gaps.

Unsurprisingly, MTC voted 11-5 in favor of a modified version of Option 1.  The five lone Commissioners who get it include among their numbers the few Commissioners who got it before.  The golden five who voted against the motion were Bates (Alameda), Daly (San Francisco), Halsted (BCDC), Lempert (San Mateo), and Mackenzie (Sonoma).  So now MTC will have a special meeting on February 17 to gauge how BART is doing with respect to the equity analysis, and to get a better sense for whether FTA is likely to grant its approval by March 5.

MTC will likely continue supporting the OAC unless there is a very strong signal from FTA in mid-February that BART’s work is not up to par.  In that case, the risk of losing the $70 million would be high, and maybe even the most stubborn Commissioners could be swayed to change course.  At the MTC meeting, though, Dorothy Dugger said that BART has been corresponding extensively with FTA and was already working in full force to complete the required Title VI action plan, which will include both the OAC and other aspects of the agency.  The plan may even be submitted to the FTA by next week.  For right now, at least, the fate of the OAC is up in the air until we get a better indication from MTC and FTA as to the adequacy of BART’s corrective action plan.

One might think that the Bay Area — which is, in so many ways, a progressive and compassionate place — would be governed by agencies that share similar values.  In the realm of transportation, especially in hard times, that means prioritizing core vital transit service — and the riders who depend upon that service — above an overpriced construction project which will attract few riders and will certainly provide no benefit to the disadvantaged and transit-dependent.  Alas, it was not meant to be.  At least not yet: though advocates typically have been a few steps ahead of MTC and have worked to get the Commission to mend its ways.  But with respect to the Airport Connector, at least, a chance was given for MTC to show its quality.  It did — and that’s something that all Bay Area residents who care about transportation should file away in back of their minds for when, in the near future, we hear more of the Commission’s thoughts on transit sustainability in the Bay Area.

The FTA agreed. In an admirably clear letter (PDF) addressed to Steve Heminger and Dorothy Dugger, the FTA requires BART to carry out analysis of the OAC’s equity impacts, or else say goodbye to the funding:

I write to inform you of the . . .  [FTA's] serious concern regarding . . . [BART's] pursuit of federal assistance for the Oakland Airport Connector (the Project).  Specifically, FTA is concerned with the preliminary results of a recent Title VI compliance review for BART, which revealed that BART failed to conduct an equity analysis for service and fare changes for the Project.  In light of this development, MTC and BART are now in danger of losing federal funding for the project, including . . . [ARRA] funds.  MTC and BART must now face a choice between continuing to pursue federal funding for the Project (which will require immediate corrective action of the Title VI non-compliance) or committing the ARRA funds to alternative projects within the Bay Area.

The announcement is a threat to the Airport Connector because BART is depending on significant federal funding, including the ARRA stimulus funds and a TIFIA loan, to complete the project. In public response to this announcement, BART has issued a brave press release that stands by the OAC’s so-called “benefits” and announces BART’s intentions to cooperate with the FTA moving forward. However, the press release distorts salient points so as to paint BART in a misleadingly favorable light. It emphasizes that “[o]ver the past decade, BART has diligently worked with the FTA to meet all its requirements,” while downplaying BART’s most recent Title VI non-compliance for the Airport Connector.

With respect to those Title VI requirements, the press release refers somewhat bitterly to the FTA’s “11th hour requirement,” which places “additional hurdles” standing in the way of the funding award. This statement makes it seem as though the FTA is suddenly acting on an unforeseeable whim, demanding that BART comply with unduly harsh, novel requirements. That characterization is disconnected from reality, since it’s hardly a secret that an award of federal monies is conditioned on compliance with relevant federal legislation, including Title VI. The requirement to analyze equity impacts was not a secret, but BART simply tried to skirt by it, probably hoping to dodge the delicate justice issues associated with charging a $12 round trip fare (a nontrivial percentage of daily wages for some airport employees) but without providing compelling transit improvements that would justify that steep fare increase. As we observed in September 2009, when the complaint was filed, the high fare would have a “disproportionately high and adverse effect on minority and low-income riders.” That finding then triggers a necessary showing that the project fulfills the public interest in a manner less adverse than other alternatives. This is part of the required analysis of fare and service changes that BART failed to complete.

The documentation that BART pointed to (PDF) as fulfilling its Title VI obligations, including the 2007 triennial report, did not analyze the Airport Connector. So BART must now confront the OAC’s problematic equity concerns quickly, before the fast-approaching deadline. Of course, it would have been preferable if BART had simply done that in the first place, even if doing so would have required radically rethinking the project. But it’s hardly the fault of the FTA that BART is now under a serious time crunch. The onus of carrying out required project analysis in a timely fashion lies squarely with BART.

Where does that leave us? Ironically, not too far from where we were almost a year ago, in February 2009, back when MTC first programmed the Bay Area’s regional transportation stimulus dollars. The FTA, in its letter, advises that if the Bay Area intends to keep the $70 million of stimulus funds, the best course of action would be to reprogram the money to other projects. Otherwise, we run the risk of BART not meeting the March 5, 2010 deadline in the stimulus legislation. If that were to happen, the Bay Area would lose the $70 million, and the funds would be distributed to another part of the country. That would be terrible, and we need to do whatever we can to keep that money in the region. But there’s a backup plan. In fact, there has always been a backup plan.

The State of California has essentially withdrawn itself from the business of funding transit operations, and the Governor has resorted to disingenuous, acrobatic budget tactics that allow him to continue robbing transit of funding in defiance of court rulings that he deems inconvenient. Transit agencies up and down the state have been left to fend for themselves. In these difficult times, it would be unconscionable to continue pursuing this poor excuse for a legacy project, especially at the risk of losing a precious $70 million that would better be distributed among Bay Area transit agencies for system preservation (PDF) — including almost $17 million for BART itself, $17.5 million for Muni, $6.7 million for AC Transit, $12.3 million for VTA, $2.7 million for Caltrain, $2.4 million for Golden Gate, and about $2 million for SamTrans.

Even last year, it was clear that the best use for this $70 million was not for the OAC, but for the transit agencies. The fact that we are now confronting a situation so similar to the one we faced last year is somehow ironic and disheartening. But most importantly, it is a second chance to set things right, and to use the money for transit rather than to build the Airport Connector.

Your participation in this process is both welcome and encouraged. As MTC once again faces the question of how to allocate this $70 million, it would be helpful for MTC to be reminded that transit agencies badly need the money, and that the funding should be distributed to those agencies to ensure that it stays here in the Bay Area. You can help by emailing MTC right now, and if possible, by attending next week’s Commission meeting. The meeting (I’ll also post the meeting information in the left sidebar for quick reference) is on January 27, 2010 at 10:30 a.m., MetroCenter Auditorium, 101 Eighth Street, Oakland.

Immediately after parking, the Council heard the Oakland Airport Connector. In spite of the Chronicle reporting that the City Council was leaning toward opposing the Connector, the Council did not ultimately adopt the resolution proposed jointly by Kaplan and Nadel. (That was the resolution that would have opposed the Connector, while supporting a more cost-effective bus alternative that would have allowed ARRA federal stimulus funds to be distributed to Bay Area transit agencies.)

Instead, the Council went with a substitute motion from Ignacio De La Fuente. That motion — which was passed with 5 ayes, 0 nays, and 2 abstained — is a resolution that supports the OAC. But the resolution conditions the Council’s support of the project on three things:

• Local hiring requirements, in the form of 50% of job hours for area residents and 25% of job hours to Oaklanders;
• Inclusion of an intermediate station in the plan, and the use of anticipated savings created by potential low bids to build that station; and
• Carrying out of impact and equity analysis regarding the OAC’s fare, and its effect on the working residents of Oakland.

The Councilmembers offered a wide variety of reactions to the Oakland Airport Connector, and the quality of their comments ranged anywhere from well-informed to clueless. Nancy Nadel opposed the OAC because the project had changed so much since voters approved it, and because the current project costs too much, is too slow, and doesn’t even take passengers directly into the terminal. Rebecca Kaplan pointed out that both the City’s and the voters’ support of the OAC several years ago was largely predicated on the promise that the OAC would provide robust service to the Hegenberger corridor in the form of two intermediate stations between Oakland Airport and Coliseum BART, stations that have since been eliminated. She also took issue with BART’s wildly fluctuating projections/fabrications with respect to job creation. (An email from BART’s Kerry Hamill suggested that the OAC could generate as many as 15,000 direct and indirect jobs, even though BART’s application to the Federal Transit Administration for funding was only willing to stand by 689 jobs, a figure that is consistent with the Environmental Impact Report certified in 2002. BART GM Dorothy Dugger, after admitting publicly that BART’s application to the feds for funding was not very well-written, continued to support the proposition that 2,542 jobs, as counted per year, was an “extremely conservative” estimate, and that a formula created by APTA projected as many as 14,000 jobs.)

On the flip side of the spectrum, Larry Reid supported the OAC because so much energy has been expended on this project, and because he wanted Oakland Airport to stay competitive in the region. Jean Quan and Pat Kernighan supported the OAC because they wanted a project that would generate much-needed local jobs in the midst of a serious recession, but were also concerned that the local hiring provisions were stated as wishy-washy goals rather than enforceable requirements. Incredibly, Kernighan — who had just gotten through opposing the parking fee increase because a $2 meter fee was apparently too expensive a burden for drivers to bear — opined that the $6 one-way fare on the OAC, by contrast, is actually quite reasonable! After all (she continued): business travelers would not mind the fee, the fare still costs less than a taxi, and Airport employees can always just ride the bus instead. You know, just in case Airport employees happen to feel disenfranchised as a result of dropping a significant percentage of their daily wage on riding a superfluous elevated airport connector for 3 miles.

Kernighan and Quan also both demonstrated a fundamental misunderstanding about the nature of the various types of funding that have been pooled together for the OAC. Quan, for instance, believed that the choice between canceling the OAC on the one hand, and redirecting federal money to transit agencies on the other hand, was a “false choice,” because the money could not be reallocated to public transportation. This is quite untrue. The $25 million of public/private partnership funds from the FTA would no longer be available for use in the Bay Area, but if the $70 million of federal stimulus funds were not spent on the OAC, they would be redistributed to other Bay Area transit agencies: with about 25% going to Muni, 25% for BART, 17% for VTA, 10% for AC Transit, and the remainder going to Caltrain, SamTrans, Golden Gate Transit, and the region’s assorted small transit operators. This is really where the federal stimulus money should have gone in the first place.

Jane Brunner, meanwhile, did not contest the false claim that the Port’s contribution, if not allocated to the OAC, would simply “go away.” And what’s more, she appeared perfectly willing to support a bad project, simply because the OAC represented a commitment to spend those dollars in Oakland. It is true that if the OAC were canceled, Oakland would not realistically be able to recapture all of the local and regional project money for its own use on other transportation improvements within Oakland, and Brunner was upset by the fact that Oakland could lose out on all that money. At the same time, though, the OAC is monopolizing a lot of money, thereby diverting that money away from other projects that would provide more tangible and substantial benefits for riders. It is not really enough to commit transportation dollars in Oakland if those dollars are spent on a project like the OAC, which, in its current form, provides little to no benefit for Oakland.

In the end, the Council went with De La Fuente’s motion of conditional support. It would have been nice to have gotten a definitive resolution from the Council opposing the Connector. The silver lining, though, is that transit advocates really did make a strong showing at the meeting — for the first time speaking in front of a governmental body that was willing to take the criticism to heart. There were 104 speaker cards filed for the OAC agenda item, and many of those speakers were adamantly opposed to the OAC. The Council heard the storm of opposition, and De La Fuente’s substitute motion reflects the concerns of Mayor Dellums and two of the core complaints that transit advocates have repeatedly raised against the OAC — both the exorbitantly high $6 one-way fare that will foreclose many locals and Airport employees from using the service, and the lack of an intermediate station that would spur transit-oriented development and offer an opportunity to do good urban design on Hegenberger. It of course remains to be seen if and how these issues will be addressed; and it remains to be seen how the City will react in the not-unlikely event that BART fails to adequately correct or mitigate what the Council’s adopted resolution identifies as the Connector’s most critical defects.

In other words, this resolution is a breath of fresh air when compared to furious string of administrative acts of rubber-stamping we’ve been watching play out over the course of the past few months. Finally: a governmental body that’s actually interested in looking critically at the project’s supposed merits, or lack thereof.

As we have remarked many times before, the OAC project has changed significantly over the years, and in all possible ways for the worse. One key change has been the removal of intermediate stations, which were specifically supported by the City several years ago. October 6 will be an important meeting, then, because the City of Oakland will finally have the opportunity to adopt a definitive position on the Connector, as the project now stands.

I would like to strongly encourage all readers to attend this important meeting and to share with the Council your thoughts on this project. And here’s something to entice you to attend: if you do speak at the meeting, there’s a chance to win a prize! How? Read on.

The City Council should know just how large and diverse the coalition opposing the Oakland Airport Connector is. And the Councilmembers should feel empowered by knowing that the people of Oakland and the greater Bay Area stand behind them, should they decide to challenge BART’s and Scott Haggerty’s disrespectful and inappropriate remarks that the City of Oakland — “not a signatory to the project” — ought to just swallow the pill and remain silent about a major project about to be built within the city limit, and one that occupies a public right-of-way, no less:

You do not need to live in Oakland to attend this hearing. Construction of the Airport Connector will waste money disbursed at the local, regional, state, and federal levels, so we all have a stake in seeing this project stopped and canceled. What’s more, almost all of the OAC funds (except for the $25 million of Penta-P money from the FTA), if not spent on the OAC, would not simply evaporate — for the most part, this funding is not “free money” from the feds that is tied specifically to the OAC. Rather, it is mostly our money that is being diverted to the OAC from other local projects — which means that if the OAC were canceled, the money would remain in the Bay Area, available for use on those other projects. The project funding also includes a federal loan that we would be better off without, since BART will go into debt for decades to pay it back. Moreover, transit riders throughout the Bay Area stand to benefit from having the $70 million of federal stimulus funds currently going toward to the OAC returned to transit agencies. Anyone from the Bay Area who cares to see transportation dollars spent responsibly has an interest in the City Council adopting a definitive resolution against the OAC.

Back to the prize. A few years ago, our friends over at SF Cityscape made an online coupon with a prize, to entice readers to attend a Geary BRT meeting. This was such a great idea, I couldn’t resist resurrecting it now. It would be great to turn out a lot of people to the Council meeting, and I wanted to do my part to encourage you, loyal readers and savvy transit-o-philes, to speak on the Connector agenda item. So, if you speak at the hearing against the Connector, you will have a choice of one of the following two prizes, to be provided courtesy of Transbay Blog:

• A free drink, to be repaid on some date after the hearing (or possibly right after the hearing, depending on when it ends).
• A free BART ticket with preloaded $5.00 value, to be distributed right at the hearing.

(Why the second prize? At a previous OAC meeting, when asked what BART fare from San Francisco to Oakland Coliseum was, BART General Manager Dorothy Dugger said she thought it was “about two-and-a half dollars.” The fare is actually $3.80 from downtown SF, and $4.15 from Balboa Park. It might seem surprising that the BART GM would have no idea what her own fares are … until you remember that she doesn’t appear to actually ride BART. Anyway, in the topsy-turvy world of Dorothy Dugger, this $5.00 BART ticket will give you a round-trip between SF and Oakland Coliseum.)

Getting the prize of your choice is as simple this: print out the image at the bottom of this post before coming to the October 6 meeting, and then give it to the guy with short dark brown hair, wearing a “WordCamp” T-shirt (look for the WordPress logo), at some point before, during, or after the hearing.

The catch? You have to be one of the first 10 people to find and give me the printout. If more than 10 people actually follow up on this offer, that would be fantastic: I have limited capacity to fund prizes, but you should still speak at the hearing anyway.

Even if you are unable to make the meeting, you can and should still send an email to the Councilmembers expressing your opinion and urging them to vote in favor of the resolution put forward by Kaplan and Nadel. You can find the Council’s contact information at this link. But if you can attend the meeting, please do so, and encourage friends to do the same. Either way, thanks for your participation.

(Link to Printer-Friendly Version of Image Below)

The idea of a Title VI complaint has been one component of the OAC discussion this past summer. Urban Habitat had previously raised this issue (PDF) at MTC, requesting that any funding be conditioned on completion of the required Title VI study. BART’s response to this request at first pointed to an environmental justice section of the Environmental Impact Report certified in 2002, and then later pointed (PDF) to the agency’s 2007 triennial Title VI report — a document that, according to the complaint, makes no reference at all to the Oakland Airport Connector, let alone the OAC’s potential impacts to low-income and minority residents.

For proposals that qualify as “significant system-wide service and fare changes and proposed improvements,” agencies seeking FTA financial assistance, in order to comply with Title VI, are required to prepare a study that documents the discriminatory impacts of those changes or improvements. Chapter V of FTA Circular 4702.1A allows agencies to use their own customized methods to assess these impacts. But that same section also supplies the FTA’s own scheme, which is rather comprehensive. In light of the high $6 fare BART has proposed for the OAC, the FTA’s focus on fare changes is especially pertinent here. In situations where fare changes are proposed, there should be analysis of whether those fare changes would encourage or discourage low-income and minority riders from using the service — as well as discussion of how the agency plans to “minimize, mitigate, or offset” any adverse effects that do occur.

For projects resulting in a “disproportionately high and adverse effect on minority and low-income riders,” FTA Circular 4702.1A states that there must be a showing “that the action meets a substantial need that is in the public interest and that alternatives would have more severe adverse effects than the preferred alternative.” BART may run into difficulty when confronting this language. A $6 fare for such a short transit trip is expensive — possibly more expensive than the fare one would pay to ride BART a much longer distance to the Coliseum Station, and a hefty addition indeed for employees who would use the route on a daily basis. The fare appears to be disproportionately adverse to minority and low-income riders; so BART would need to show not only that the OAC meets an important public interest, but also that alternatives to the OAC would be more adverse.

BART will also have difficulty showing this last point. TransForm’s RapidBART proposal, which is a more cost-effective enhanced bus, would cost a fraction of the OAC to build. And yet, it is a superior transit project — since its fare would be much less than $6 or even free, and it would include an intermediate stop, making it a useful transit option for airport employees and others who work along the Hegenberger corridor. The funding assembled for the OAC also includes a significant amount of regional monies, which, if redirected to local transit, might well result in greater overall benefit than the OAC, by enhancing service to transit-dependent communities and increasing ridership. The OAC has in essence become the project alternative that has the most adverse effect on low-income and minority riders. RapidBART is a less adverse alternative that would better fulfill the public interest, by freeing up money that could then be spread to other useful projects in Oakland or Alameda County.

The OAC is a proposed improvement within the meaning of Circular 4702.1A. If it’s determined that neither of the documents that BART has offered to date — the environmental justice section of the EIR, or the 2007 triennial report — is sufficient to cover the bases discussed in Circular 4702.1A, then BART may have a Title VI problem on its hands. Rectifying that problem would require BART to more closely analyze the impacts of the OAC (high fare, no intermediate stops, and all) to low-income and minority communities, costing BART precious time.

In a recent two-part post (part 1, part 2), we examined the criteria that the U.S. Department of Transportation will use to evaluate project submissions that request TIGER Discretionary Grants and TIFIA credit assistance. In that post, we made an initial assumption: namely, that the OAC would satisfy all relevant background federal laws, thereby permitting the federal government to disburse funds to the project. We made that assumption so that we could reach the ultimate question of how well the OAC would fare under the TIFIA program itself — concluding that the OAC’s match to those criteria, while by no means abysmal, was mixed.

However, if a project like the OAC is found to have violated background federal legislation, then it is not eligible to receive federal money, from the get-go — even if it were a perfect match in every other way for the TIFIA loan program. The federal legislation is, then, a threshold question: the first set of hoops to jump through. The complaint argues that BART, in its rush to push through the OAC in step with the rapid timeline mandated by the federal stimulus program, failed to comply with its obligations under Title VI of the Civil Rights Act (which is one of the threshold federal laws). A significant portion of the total funding for the OAC, including the proposed TIFIA loan, will be provided by the federal government. In order to receive federal money, agencies like BART must comply with relevant requirements in federal legislation, including Title VI. Failure to do so prevents the flow of federal money. In the case of the Oakland Airport Connector, that means additional delay and opening up a large funding gap that stands in the way of completing the project.

If the FTA accepts this complaint, it will strive to complete its investigation of the complaint within 180 days of accepting it.

TIGER (TIFIA Payment)

MTC has prioritized the Oakland Airport Connector for a $5 million TIGER TIFIA payment to support a $100 million TIFIA loan. This is a special type of TIGER Discretionary Grant, which the OAC is eligible for, since it is a transit project. TIGER Discretionary Grants, like all ARRA stimulus funds, are intended to be distributed to projects that fulfill the core goals of the stimulus: job creation/preservation, and encouraging the construction of infrastructure projects that improve both public benefits and increase economic vitality.

Superimposed upon this general philosophy are tiers of selection criteria that are specific to TIGER Discretionary Grants. Going backwards, there are two “Secondary Selection Criteria”: (i) extent to which the project uses innovative technology, and (ii) extent to which the project encourages public/private collaboration, and collaboration between different levels of government. We’ll touch on these points later in this post. Weighed more heavily are the “Primary Selection Criteria,” which fall into two categories:

• Long-Term Outcomes: In order for a TIGER project to move forward in the evaluation, there must be significant long-term benefit. No (or insignificant) long-term benefit, no TIGER grant. Projects should have a national or regional impact, preferably with respect to at least one of the following five long-term outcomes: (i) state of good repair; (ii) economic competitiveness; (iii) livability; (iv) sustainability; or (v) safety.
• Job Creation & Economic Stimulus: Once USDOT determines that a project will likely have a significant long-term benefit in one of the five categories listed above, then it can consider this category, which focuses on “rapid economic impact” — the short-term job creation potential that sort of typifies the federal stimulus package.

Evaluating the primary criteria will come down to determining how “significant” the national or regional impact is. There is no doubt that the OAC, as it stood in 2002, would have done a much better job of meeting these criteria than it can today. Looking to the first long-term outcome, it would be a bit much to call the OAC a mere “upgrade,” since it’s really an expansion project that will not contribute positively to state of good repair. Moreover, with the two intermediate stations stripped from the project, the line will provide minimal economic and land use benefits to the Hegenberger corridor — even in the long-term. Thus, the OAC’s impact lies in its ability to affect travel patterns. But even in this respect, the OAC does not seem significant. The latest travel time estimates are comparable to bus service because speeds have been reduced. TIGER projects are subject to a cost-benefit analysis, and the OAC is unfortunately a classic case of fairly minimal benefits for extremely high cost (here, about $175 million per mile). Upgrading the current AirBART bus (with queue jump lanes and signal priority) would improve reliability, and would increase ridership to near the OAC projections — but could be built for 10% of the cost of the OAC.

The third outcome, livability, considers factors like enhanced mobility/connectivity, and improved access for disadvantaged populations. This sounds promising, until we recall changes to the OAC. Travel time has increased, and the simple, direct connection between the Airport and the Airport OAC station has been removed, forcing patrons to descend to ground level to access the Airport. So the OAC will not actually improve mobility and connectivity; an improved bus link, along the lines of the RapidBART proposal, would provide a superior connection, and low-floor vehicles would ensure disabled access. Projects with significant long-term livability benefits should also “improve[ ] the quality of the living and working environment of the [affected] community.” The OAC does no such thing; the elevated transitway would shadow the corridor, but would provide no benefits to the community in the form of intermediate stations.

Increased trip time — along with a projected slump in air traffic, and California High-Speed Rail, which will directly compete with about 40% of the air traffic at Oakland Airport — are reflected in the 2009 ridership projections, which were revised downward to between 3,770 and 4,670 total riders by the year 2020 (compared to 13,540 riders projected in 2002); and most of those are not new riders. These numbers suggest that OAC will not significantly alter existing travel patterns.

So does the OAC have a significant regional impact? Symbolically, perhaps, but not if you look at the numbers. The daily ridership of the OAC will be well under 1% of total daily transit trips around the region, and a tiny drop in the bucket of all trips. Nor would the OAC itself significantly induce additional trips to Oakland Airport. The fact of the matter is, the vast majority of people going to Oakland Airport will not be interested in taking the OAC. They might, however, point to it while driving on Hegenberger.

Next question: is the Oakland Airport Connector a good match for the TIFIA loan program?

TIFIA Loan

The proposed $100 million TIFIA loan would cover about 20% of the Oakland Airport Connector cost, which is well under the 33% cap set by the federal legislation. The cost of the OAC is well over $50 million, and fares would constitute the required dedicated revenue source. In order to qualify for federal funding, a project must also be prominently featured as a priority in regional and state transportation plans. Here, the OAC is receiving State Transportation Improvement Program (STIP) funding, and is also a committed transit expansion project in the Regional Transportation Plan. Applicants for TIFIA loans must also provide a preliminary rating opinion letter from a nationally recognized credit agency that speaks to creditworthiness.

Urban Habitat has previously raised the possibility of a Title VI claim (PDF) concerning the Connector, which raises an obvious problem; the OAC cannot receive federal funds, like the TIFIA loan, if Title VI of the Civil Rights Act has been violated. Here, for simplicity, we’ll assume that the OAC meets all the threshold eligibility requirements — including general federal requirements for transit projects, and compliance with background federal legislation like Title VI and the National Environmental Policy Act. Then, USDOT will score the application according to eight weighted criteria. The first three are most important, accounting for 60% of the score.

Significance (20%): This important criterion asks whether the proposed project is of national or regional significance.

• It’s easy to look at the OAC on the surface and conclude that it is significant on a regional level and even national level, because it connects BART to one of the region’s three major airports. But once you consider the details of how the OAC has been diluted over the years, it looks less significant. There are a number of factors that speak to a project’s significance — including economic benefit and transportation connectivity. On both counts, there is good reason to believe the OAC’s benefits will not be especially significant. See: the TIGER discussion directly above.
• As it turns out, another factor that contributes to “significance” of a project is the extent to which the community supports the project. The OAC does not have widespread support among the community (as indicated by the long list of citizens who signed this anti-OAC petition, urging BART to abandon the OAC and pursue a more cost-effective rapid bus solution). The City of Oakland and community members long ago made very clear that their support for this project was tied to the intermediate stations. Removing the stations at Edgewater and Doolittle has prompted renewed outcry from the community. (BART has indicated a future station might be built at Doolittle, but it’s anyone’s guess where the money will come from.) Many members of the public who spoke at MTC against the OAC opposed the project’s elevated guideway, which would loom over Hegenberger without providing any economic benefit to the corridor. Others spoke against using half a billion dollars to build a project that benefits comparatively few people, when service cuts and fare hikes affect way more people. Basically, almost no one actually likes the Connector for what it is. Even MTC doesn’t like it, but voted to fund it anyway, because that’s just how things go down at 101 8th Street.

Private Participation (20%): Another important criterion, this considers whether the TIFIA loan would encourage public-private partnerships and attract private investment.

• BART seriously began considering the idea of private financing in 2005, so that it could close the funding shortfall. In 2007, BART issued an RFP for a Design-Build-Finance-Operate (DBFO) contract, and that same year, $25 million from FTA’s Penta-P program for public/private partnerships was added to OAC funding. But by 2008, all of the three pre-qualified teams had withdrawn. Once that happened, the OAC looked like it might be a dead duck, until stimulus funds became available in 2009.
• One of the defining motivations of the TIFIA program is to use federal credit assistance as a means of leveraging and encouraging private investment in surface transportation. But in the case of the OAC, BART is pursuing a TIFIA loan precisely because private investment wanted nothing to do with the financing of this project. So BART will instead pursue a Design-Build-Operate-Maintain (DBOM) contract, using a combination of ARRA stimulus funds and TIFIA to close the funding gap that emerged once it was clear private financing was no longer an option. This is still a public/private partnership, but the OAC should not score as highly as it otherwise might.

Environment (20%): The last of the three important criteria, this factor considers the extent to which a project maintains or protects the environment, and how much environmental mitigation it requires. To some extent, this overlaps with the “sustainability” long-term outcome for TIGER funds. For this factor, the OAC will probably fare well.

• Given the large number of road projects across the country that have obtained TIFIA loans, environmental protection does not appear to be an insurmountable obstacle. In any case, the OAC probably will score higher just by virtue of being a transit project. But it is worth mentioning that the OAC’s environmental benefits — which in large part consist of the project’s ability to reduce vehicle miles traveled — are less significant now that ridership projections are lower than they were in 2002.
• An elevated guideway in a street right-of-way is not generally a recipe for an environmentally damaging project. The OAC’s impacts include noise, construction, vibration, and growth-inducing impacts — along with the elevated guideway itself, which is a significant and unavoidable visual impact. All in all, though, the environmental issues and potential mitigation measures are not extensive or complicated.

Creditworthiness (12.5%): The Secretary of Transportation will determine whether or not sufficient security measures are present to safeguard repayment of the loan. The creditworthiness evaluation also considers other relevant factors, e.g. the project team’s qualifications, whether the completion schedule is reasonable, and whether the proposed financial plan is reasonable. Meanwhile, BART has claimed that even under reduced ridership projections, the OAC fares will still net a surplus while paying off the loan:

Courtesy of BART.

Project Acceleration (12.5%): The OAC will score well for this factor. The project already takes advantage of several types of funding made available at various levels of government (the funding is listed under the “Background” heading of this post). OAC funding even includes specialized one-time stimulus funds. And yet, without TIFIA, there would still be a funding gap. It’s not clear what alternative sources of funding are available, nor is it clear how long it would take to assemble about $100 million (or more, if stimulus money is lost, and as costs escalate over time). The TIFIA loan presents a good opportunity to close the funding gap and accelerate project delivery on the fast schedule required by ARRA stimulus funds.

Other Factors (5+5+5 = 15%): Three other factors are included in the analysis: (i) use of innovative technology, (ii) amount of budget authority consumed, and (iii) reduction in federal grant assistance. These factors are not worth much in the total equation but could provide a small bonus for the OAC, since the $100 million loan BART is seeking is small by TIFIA standards.

Conclusion

This is a really long post, so congratulations if you’ve made it this far. Where do we end up? The Oakland Airport Connector is a good fit for a couple of the less important criteria. Environmentally, the project is uncomplicated and potentially beneficial, so it might score well on that; but it is not really a slam dunk for the three most important TIFIA criteria. The OAC, which connects an important airport to a regional rail system, might seem to be regionally significant at first glance — symbolically, in the abstract. But the changes that have occurred to the project since 2002 minimize both its effectiveness as a transit operation and its potential to transform Hegenberger into a denser, more productive transit corridor, thereby diminishing its significance. The OAC is a public/private partnership, but it has failed to attract private financing, which is one of the underlying goals of TIFIA credit assistance program. It should not be lost on us that a large part of the reason we are talking about TIFIA loans in the first place is that private partners were not interested in financing this project.

We would strongly encourage USDOT to consider carefully the history of the Oakland Airport Connector, and to consider the substantial changes that have occurred since the EIR/EIS was certified in 2002, before awarding the TIGER/TIFIA funding. Those changes certainly minimize the OAC’s potential public benefits — but they also appear to hinder the OAC’s ability to fully satisfy the evaluation criteria that are used to evaluate TIFIA loan applications.

As we’ve discussed here a few times before, BART is about $100 million short of the funds it needs to build the Oakland Airport Connector (OAC), a gap which accounts for approximately 20% of the total capital cost. To fill that gap, BART intends to take out a TIFIA loan, basically as a last resort measure. The Transportation Infrastructure Finance and Innovation Act (TIFIA) and associated regulations outline a program in which the U.S. Department of Transportation (USDOT) provides credit assistance (loans, loan guarantees, or lines of credit), to ease and accelerate the completion of significant surface transportation projects. Many different types of applicants are eligible for TIFIA assistance, including local governments, state DOTs, transit agencies, and private parties.

Last month, the Metropolitan Transportation Commission also identified the OAC as one of four regional priorities for the purposes of bringing a limited amount of TIGER stimulus funds (one component of many in the American Recovery and Reinvestment Act) into the Bay Area’s transportation coffers.

Although it remains to be seen whether Caltrans will include the OAC in its Governor-endorsed consensus list of projects (discussed in this post), MTC has suggested that only a small amount of TIGER funds be allocated to the OAC — just $5 million out of the $133 million it requested. The TIGER program specifically allows USDOT to use up to $200 million (of the $1.5 billion total TIGER funds) toward what are known as “TIGER TIFIA payments” — smaller sums of money that would cover subsidy and administrative costs, to support about $2 billion of TIFIA credit assistance for projects that are well-aligned with the goals of the TIGER program. That’s what the $5 million requested for the OAC would be: a TIGER TIFIA payment to support the roughly $100 million TIFIA loan that BART is seeking.

So we have the TIGER stimulus money, and then we have this TIFIA loan. These two federal programs have been linked to each other via the TIGER TIFIA payments, but they are nonetheless distinct programs. Applicants seeking both a TIGER TIFIA payment and a TIFIA loan must apply to the two programs separately. To receive funding, project proposals must pass muster under both programs.

It’s not the end of the world to take advantage of a TIFIA loan; plenty of places around the country do, and there are some projects that are particularly well-suited to it. In fact, many of the approved TIFIA loans from around the country have taken out loans much larger than the $100 million loan BART needs. But it’s also not something to take lightly. In order to qualify for the loan, the project must be backed by a dedicated revenue source, like user fees. In this case, that revenue source is the the exorbitantly high $6 one-way/$12 round-trip fare BART intends to charge passengers who will ride the OAC.

If the Oakland Airport Connector were going to provide truly significant benefits, a TIFIA loan might be a good way to get the project moving. If the choice is between postponing a beneficial project, on the one hand, and repaying the loan, on the other hand, the loan might be the right choice. That way, the public could enjoy the project’s benefits that much sooner, particularly if the funding relief attracts additional private investment. But the current state of the OAC provides few benefits over the status quo. The benefits that would have been provided, as documented in the Environmental Impact Report certified in 2002 — intermediate stations, quick travel time, a seamless terminal connection at Oakland International Airport, and high ridership — are no longer a reality. The intermediate stations are gone; the travel time between Coliseum BART and the Airport is, frankly, a wash as compared to a bus; and the seamless Airport connection has been eliminated. Ridership, now a fraction of what was once predicted, will not be substantially higher than AirBART. And then there is the matter of the high fare. At $522-552 million, the OAC just isn’t a strategic investment.

I won’t rehash all these details again, but if you haven’t done so already, please read about them in this earlier post. The details are important, because they also speak to the Connector’s potential TIGER and TIFIA eligibility. Given how the OAC has (d)evolved, is the project, in its current state, a promising candidate for federal funds? Answering that question will require looking at the criteria that USDOT itself will consider. More on that in the next post.