Archive for the ‘Transit Funding’ Category
In Search of a Stable Equilibrium
The elimination of State Transit Assistance (STA) funds in California has forced transit operators throughout California to scrape the bottom of the barrel, so to speak, in search of replacement money for operations; this has resulted in controversial proposals to raise fares while trimming service. But if there is any silver lining to be found here, it’s this: now that we have reached the bottom of the barrel, we have the opportunity to start anew — and to think critically about stable sources of money to fund transit for the long haul. The Commission on the 21st Century Economy has been charged by Governor Schwarzenegger to issue a report by July 31, 2009. That report will detail the Commission’s suggested revisions to local and state revenues so as to stabilize those revenue streams — including, but of course not limited to, funding for transit. Meanwhile, the California Transit Association has compiled a list of recommendations for the Commission to consider for the transit portion of the discussion. Reflecting on the current state of things — the need to support and stimulate a dynamic economy, the need to reduce emissions and comply with SB 375 and AB 32, and the fact that the State has pillaged some $5 billion of transit funding in the past decade — the CTA urged the Commission to pursue stable funding for transit.
Where is the Transit Voice?
There is a lot that we might say about the fare hikes and service cuts that the SFMTA has proposed to close its $128.9 million budget deficit for the upcoming fiscal year. The 74X Culture Bus, which rarely carries more than a couple riders and largely duplicates the 5-Fulton, ought to be cut. But seeing as the core section of the Geary route is already inundated with riders, the Ocean Beach branch of the 38-Geary should not be cut, particularly when we ought to take measures to grow ridership on this workhorse Muni corridor. Many agencies do charge for transfers, so adding a 50-cent charge for a transfer might not seem like scraping the bottom of the barrel — but that, too, would be an unjust move, considering that the entire system layout, attuned as it is to the street grid, is predicated on the availability of a free transfer. The SFMTA could redesign many routes to take on an angular shape that eliminates the transfer (and in the process, potentially further damage headway consistency on some corridors); but charging for a transfer is inconsistent with the existing route alignments. The proposed changes consist largely of service cuts that are informed by data from the Transit Effectiveness Project, but without implementing the increased service to core routes that the TEP also envisioned. There is much more that we could say about those cuts; those thoughts are indeed being voiced, and we would certainly encourage you to do so as well directly to the SFMTA, if you can — either by attending today’s hearing at City Hall (Room 400 at 2:00 pm), or by contacting the MTA through other means. At today’s hearing, the MTA will also consider declaring a fiscal emergency to exempt its proposed changes from CEQA review.
Shifting Funds, Shifty Priorities
First, A Few Numbers (and Acronyms)
Regular readers may recall our previous discussion of Transportation 2035, the latest update to MTC’s ongoing efforts on the Regional Transportation Plan. Earlier this year, we wrote a special feature that describes the multifaceted plan, fleshing out how MTC has proposed to allocate $226 billion of local, state, and federal transportation funding that was expected to become available to the Bay Area over the next quarter century. However, changes in the economy and funding climate have necessitated that MTC revise a few aspects of the RTP. The State of California yanked away STA money that funds transit operations; in the Bay Area, this means that local transit operators will lose access to over $55 million that they were relying upon for the remainder of this fiscal year, and no STA funding at all will be provided in upcoming years. Assuming that the state reinstates STA funding in five years, the Bay Area will have lost $1.2 billion of STA and spillover funds in the interim; MTC also projected a $4.5 billion loss in TDA revenue over the 25-year RTP timeline. Another change is VTA’s recent announcement that it can only afford to build the BART extension to San Jose as far as Berryessa Station, postponing the construction of the downtown subway alignment. This, in turn, is connected to the issue of declining transportation sales tax revenue; this is potentially problematic throughout the region, not just in Santa Clara County, although it is not yet clear just how problematic. Considering the new forecasts for transit revenue, the region’s transit operation shortfall will increase from $3.2 to $8.5 billion. This includes a $283 million shortfall for AC Transit, a $442 million shortfall for Golden Gate Transit, a $1.6 billion shortfall for SamTrans, a $1.9 billion shortfall for Muni, and a whopping $3.2 billion shortfall for VTA, which is the worst operation shortfall in the region. Meanwhile, the transit capital shortfall will increase from $16.1 to $17.1 billion. It also takes into consideration that the cost of the BART extension to San Jose has increased from $6.1 billion to $7.6 billion (year of expenditure). Overall, the $226 billion plan has been reduced in size to a $218 billion plan. The plan adds $1.3 billion of revenue: about $280 million in connection with AC Transit’s Measure VV parcel tax, and $1 billion of VTA joint development revenue. It also anticipates $3 billion of funds for high-speed rail, with half coming from Proposition 1A, and the other half coming from the federal stimulus package’s $8 billion allocation to high-speed rail.
Update: Bay Area STA Funds for 2008-09
Last week, we discussed how the finalized state budget decimated State Transit Assistance Funds (STA) funds, and what the result would be for Bay Area transit operators in terms of lost operating revenue. That previous post contained the Metropolitan Transportation Commission’s figures on how the remaining STA funds would be distributed between Bay Area transit agencies. However, last Friday, I phoned the Metropolitan Transportation Commission offices to point out that their STA fund distributions contradicted the actual text of the budget legislation. The budget included funding for the first two quarters of FY2008-09, while MTC’s numbers only accounted for the first quarter of funds — which was inaccurate in light of the fact that the Governor decided not to kill the second quarter of STA funds with a line-item veto. In other words, this fiscal year, California’s transit agencies will receive $153 million (from an originally planned $306 million) of STA funds, not just the $76 million that MTC had planned on. Shortly after I called them, I noticed that their analysis of the state budget was taken down off the web. But now, the updated figures are available, and we find that these are the funding allocations for transit agencies in FY2008-09. As before, the right column of the table represents the lost amount that agencies would have received had the state budget retained the full $306 million of STA money:
Budget Deal Is Not A Deal For Transit
UPDATE (23 February 2009): For updated figures on transit funding loss for FY2008-09, read this post.
The big piece of news in California is the long-overdue compromise in the state legislature over how to close the General Fund shortfall, which amounts to $42 billion through June 2010. The budget consists of $15 billion cuts to spending, $12.8 billion in temporary tax increases, and $11.4 billion in borrowing; the Governor may also make $600 million of additional cuts in line-item vetoes. The vote on a budget deal stalled for days, with just a single Republican vote shy of the 2/3 required for passage. Finally, after more than 45 hours, in what is supposedly the longest Senate floor session in the state’s history, Abel Maldonado (R-Santa Maria) supplied the needed vote by extracting substantial concessions. One concession was the elimination of the additional 12 cents to the gas tax; another was the approval of voter measures. If passed, one measure would prohibit legislative pay increases during deficits; another measure would establish an open primary system, in which the top two vote-getters in the primary election would advance to the general election regardless of party.
As we discussed last week, this budget compromise eliminates State Transit Assistance (STA) funds, which transit agencies throughout California rely on for operations money. Here is the breakdown for major Bay Area transit agencies, as detailed by the Metropolitan Transportation Commission. The right column represents the loss for 2008-09; that is, the difference between the remaining $76.1 million STA allocation (which basically represents the first quarter) and the amount that agencies would have received had the budget retained the full $306 million of STA money:
Squeezing the Sponge Dry
In the last two budget cycles, California’s leaders elected to redirect some $3 billion away from transit agencies. But a proposed budget deal would now finish off the job and take the rest of what little remains: $230 million of State Transit Assistance funds due from the 2008-09 September budget, and the full $306 million from the 2009-10 budget. The proposed STA elimination would deprive agencies of critical operating funds, trigger service cuts and fare hikes, and result in a loss of jobs. The state budget does not have an easy fix, particularly while the two-thirds budget vote requirement remains in effect, and it is too soon yet to know if this proposed arrangement will stick. Sometimes it seems that each new week brings a new budget deal to be hatched, and the fate of this particular deal may not be decided on until later today or this weekend. But given the trend, the utter demise of state transit funding appears to be the unfortunate, yet inevitable, conclusion; if not now, then just around the corner. We have spoken before of the mismatch in California, in which our elected officials are more than happy to heap praise in broad strokes upon the environmental credentials of AB 32, SB 375, and high-speed rail, all while signing off on the one-way drain of transit funds that are then used to haphazardly plug the leaky state budget. This time, every last drop would be squeezed out, even if the funds to be removed are quite literally a few drops in the proverbial bucket. Our politicians are happy to call attention to their support of a forward-looking vision, though what once seemed visionary now looks increasingly to be merely necessary damage control. But actually protecting transit service, the foundation that underlies that vision? That is another matter altogether.
Stimulus Update: Details from the Final Package
Talking Points Memo has the details on allocations in the final stimulus package. How do things stand as far as transportation is concerned?
- On funding for roads and bridges, a compromise was hatched between the House version ($30 billion) and the Senate version (just over $27 billion). The final damage? $29 billion.
- The funding transit ditches the House’s $12 billion allocation, including Nadler’s amendment, and it maintains the Senate’s less robust $8.4 billion version. Of that, $6.9 billion is allocated to transit formula grants, and $750 million to each of fixed guideways and New Starts.
- Amtrak supplemental capital grants were boosted considerably. The House version proposed $800 million, while the Senate proposed $850 million. The final version? $1.3 billion. However, the provision for intercity/HSR grants to states has been stripped entirely.
- The Senate’s proposal for $5.5 billion of supplemental discretion grants — competitive grants that would be awarded at USDOT discretion — was replaced with $1.5 billion.
- For airport grants, the Senate’s proposed $1.3 billion was maintained in the final bill.
- The final approved bill incorporates a dramatic boost in funding toward high-speed rail. The Senate’s version allocated $2 billion, while the House’s version did not allocate any money specifically for high-speed rail. The final version, however, allocates $8 billion to high speed rail; we can thank the Obama Administration for pressing that increase forward. (Note that the United States permits itself a more generous definition of “high speed.” Although the generally accepted standard, e.g. in Europe is 200 km/hr = 125 mph, in the United States, speeds as low as 90 mph = 145 km/hr qualify as “high speed.”) It seems probable that much of the funding will be applied to proposals that have made the most progress, which is a good development for California. Among the nation’s designated high-speed rail corridors, California’s project is the furthest along in the process, having certified a programmatic level EIR/EIS, and is currently undergoing the process of preparing specific project-level environmental documents.
In its initial proposal for spending the Bay Area’s stimulus money, the Metropolitan Transportation Commission suggested $50 million (of the Senate’s proposed $2 billion for high speed rail) to be applied toward the fund for the Transbay Transit Center train box, in addition to $75 million from transit funds. We will see if or how this changes with the new $8 billion HSR allotment — as well as the other revisions that are made as MTC puts together its final plan for the Bay Area’s local transportation stimulus.
Menu for the Bay Area Transportation Stimulus
Although we have yet to see a fully reconciled stimulus bill to come from Congress and President Obama, agencies across the nation are eagerly putting together their wish lists for how to spend their portion of the $800 billion-plus stimulus pie. Here in the Bay Area, the Metropolitan Transportation Commission has released a draft (PDF) explaining how it plans to allocate stimulus fund to transportation projects throughout the region.
Just how much money could the Bay Area get? It will not be exactly clear until the stimulus legislation is officially passed, but according to MTC’s current estimates, we could see $320-$500 million in FTA funds (sections 5307 and 5309), $140-$200 million Surface Transportation Program/FHWA funds, and $23 million (out of California’s $125 million total) for STP transportation enhancements. Moreover, California as a whole may receive $1.7-$2 billion in further FHWA funds, a chunk of which Caltrans and the California Transportation Commission would surely direct towards the Bay Area. Still further opportunities for funding might exist through other programs that have been weighed in the stimulus discussion, including the Senate’s $5.5 billion of competitive grants to be awarded at USDOT discretion, and the $2 billion allocation for designated high-speed rail corridors.
Stimulus Update: Collins-Nelson Senate Compromise
UPDATE (10 Feb 2009): The Senate passed its $838 billion version of the stimulus plan. Three Republicans joined the Democrats for the 61-37 vote. More details forthcoming about the conference committee.
Last week in the Senate stimulus saw California’s Barbara Boxer — who, ironically, happens to chair the Senate Committee on Environment and Public Works and is working on climate change legislation — join forces with climate change skeptics in both proposing and endorsing stimulus bill amendments that would have funded more highway construction, thereby increasing national vehicle miles traveled. Her Inhofe-Boxer amendment proposed adding $50 billion of funds for exclusive highway use, and she also expressed support for amendments of Kit Bond (R-Missouri), which would have yanked $2 billion of high-speed rail money and $5.5 billion of competitive grants, redirecting both to highways. Was it all in the name of holding onto her seat in the Senate? Perhaps. Boxer experienced pressure from transit and environmental advocates to diversify the content of her $50 billion amendment so that the funds could also be applied to water and transit projects. There was plenty of back-and-forth on the Senate amendments, but the Senate appears to have finally settled into the Susan Collins (R-Maine) and Ben Nelson (D-Nebraska) compromise. Thankfully, that compromise does not gut the transit funding. It is a proposal, but one that seems to have accumulated support. Thanks to those of you contacted your senators, urging them to leave the transit funds intact.
So now where do we stand — and what will the final stimulus bill look like, assuming the Senate compromise passes? The funding priorities of the House and Senate versions exhibit marked differences. As we noted earlier, the Senate version includes $5.5 billion of competitive grants awarded at USDOT discretion, and $2 billion for designated high-speed rail corridors, but not as much as a penny for fixed guideway modernization or New Starts. The House version, by contrast, does not include competitive grants or high-speed rail funds; but it does allocate $2.5 billion to New Starts and $2 billion to fixed guideways. So the differences between the House and the Senate are differences in kind, not degree. We look forward to seeing how these differences are reconciled.
Stimulus Update: Thoroughly Unstimulating
UPDATE: Preliminary word indicates that Senator Boxer’s $50 billion push for highways did not pass.
UPDATE: The two Bond amendments (see below), which would divert $2 billion for high-speed rail and $5.5 billion of grants that could fund transit and reapply the funds for highways, are an urgent matter today. Call your Senator right away (switchboard number is 202-224-3121) to urge that these amendments, in particular, not go through.
The U.S. Senate has been going through rounds of amendments on its version of the economic stimulus bill. Unfortunately, as far as transit is concerned, the discussion in the Senate has gone from bad to worse. Last week, we examined the transportation provisions included in the original Senate version; while that version included $2 billion allocated to high-speed rail, it included only $8.4 billion total for transit, and no money for fixed guideway modernization, New Starts, or transit operation. It also provided for $5.5 billion of competitive grants, to be awarded at the discretion of the Secretary of Transportation to all types of transportation projects, including both highways and transit. A proposal from Charles Schumer (D-New York) to add $6.5 billion for transit was a promising development. But since then, certain senators — including, shamefully, California’s very own Barbara Boxer — have proposed to gut the already-paltry transit stimulus and to redirect new money toward highways:
- Barbara Boxer and James Inhofe (R-Oklahoma) will propose that $50 billion (yes, that’s with a B) be added to the highway fund.
- The amendment proposed by Dianne Feinstein (D-California) and Patty Murray (D-Washington), which would have added $5 billion for transit (of which $2 billion was for fixed guideway modernization and $1 billion for New Starts) and $13 billion for highways did not pass, falling two votes short.
- Kit Bond (R-Missouri), who has previously discouraged Congressional attempts to address climate change on the ground that doing so would be bad for business, will propose an amendment that would redirect the $5.5 billion of competitive grants (which are currently available to both highways and transit, at the discretion of Ray LaHood) so that those funds would apply only to highways and bridges; Barbara Boxer plans to endorse this amendment. Kit Bond may also propose another amendment that would redirect $2 billion high-speed rail allocation to — you guessed it — highways.
- Barbara Mikulski (D-Maryland) proposed to allow those purchasing cars to claim an income tax deduction for sales tax and interest payments on car loans.
Transit agencies across the nation are in financial trouble, proposing service cuts and fare hikes, and this while national interest in transit is increasing. These agencies could desperately use funding for operations. Senators’ proposals to amend the stimulus by allocating ever-increasing funds toward highway construction demonstrate startingly short sight, and a thoroughly dissapointing lack of commitment to building the sustainable transportation system that this country both craves and needs. We deserve better, and our senators need to hear about public dissatisfication with their misguided proposals. Please call Barbara Boxer at 202.224.3553, Dianne Feinstein at 202.224.3841, write in here, and if you are reading from outside California, call your senator to support for increased funding for transit, and to express dissatisfaction with the most recent amendments that irresponsibly abandon transit to fund more highways.
