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54–280 PDF 2009

S. HRG. 111–210 

A FRESH START FOR NEW STARTS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

HOUSING, TRANSPORTATION, AND COMMUNITY 

DEVELOPMENT 

OF THE

COMMITTEE ON 

BANKING, HOUSING, AND URBAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

ON 

EXAMINING THE IMPORTANT ROLE OF THE FEDERAL NEW STARTS 

PROGRAM IN FUNDING TRANSIT PROJECTS ACROSS OUR NATION 

JUNE 3, 2009 

Printed for the use of the Committee on Banking, Housing, and Urban Affairs 

( 

Available at: http://www.access.gpo.gov/congress/senate/senate05sh.html 
COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS 

CHRISTOPHER J. DODD, Connecticut, Chairman 

TIM JOHNSON, South Dakota 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

EVAN BAYH, Indiana 

ROBERT MENENDEZ, New Jersey 

DANIEL K. AKAKA, Hawaii 

SHERROD BROWN, Ohio 

JON TESTER, Montana 

HERB KOHL, Wisconsin 

MARK R. WARNER, Virginia 

JEFF MERKLEY, Oregon 

MICHAEL F. BENNET, Colorado 

RICHARD C. SHELBY, Alabama 

ROBERT F. BENNETT, Utah 

JIM BUNNING, Kentucky 

MIKE CRAPO, Idaho 

MEL MARTINEZ, Florida 

BOB CORKER, Tennessee 

JIM DEMINT, South Carolina 

DAVID VITTER, Louisiana 

MIKE JOHANNS, Nebraska 

KAY BAILEY HUTCHISON, Texas 

EDWARD SILVERMAN, Staff Director 

WILLIAM D. DUHNKE, Republican Staff Director 

DAWN RATLIFF, Chief Clerk 

DEVIN HARTLEY, Hearing Clerk 

SHELVIN SIMMONS, IT Director 

JIM CROWELL, Editor 

SUBCOMMITTEE ON HOUSING, TRANSPORTATION, AND COMMUNITY DEVELOPMENT

ROBERT MENENDEZ, New Jersey, Chairman 

DAVID VITTER, Louisiana, Ranking Republican Member 

TIM JOHNSON, South Dakota 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

DANIEL K. AKAKA, Hawaii 

SHERROD BROWN, Ohio 

JOHN TESTER, Montana 

HERB KOHL, Wisconsin 

MARK R. WARNER, Virginia 

JEFF MERKLEY, Oregon 

KAY BAILEY HUTCHISON, Texas 

ROBERT F. BENNETT, Utah 

MIKE JOHANNS, Nebraska 

MIKE CRAPO, Idaho 

MEL MARTINEZ, Florida 

JIM DEMINT, South Carolina 

HAROLD J. CONNOLLY, Housing Staff Director 

MICHAEL PASSANTE, Transit Staff Director 

TRAVIS M. JOHNSON, Republican Staff Director 

AMIT BOSE, Legislative Assistant 

MITCH WARREN, Senior Policy Advisor 

(II)
C O N T E N T S 

WEDNESDAY, JUNE 3, 2009 

Page 

Opening statement of Chairman Menendez .......................................................... 1 

Opening statements, comments, or prepared statements of: 

Senator Schumer .............................................................................................. 4 

WITNESSES 

A. Nicole Clowers, Acting Director, Physical Infrastructure Issues, 

Government Accountability Office ...................................................................... 3 

Prepared statement .......................................................................................... 20 

Response to written questions of: 

Senator Menendez ..................................................................................... 49 

Gary C. Thomas, President/Executive Director, Dallas Area Rapid Transit, 

and Vice Chair—Rail Transit, American Public Transportation Association . 6 

Prepared statement .......................................................................................... 39 

Response to written questions of: 

Senator Menendez ..................................................................................... 50 

Richard Sarles, Executive Director, New Jersey Transit ..................................... 8 

Prepared statement .......................................................................................... 41 

Mariia Zimmerman, Policy Director, Reconnecting America ............................... 10 

Prepared statement .......................................................................................... 44 

Response to written questions of: 

Senator Menendez ..................................................................................... 54 

(III)

(1) 

A FRESH START FOR NEW STARTS 

WEDNESDAY, JUNE 3, 2009 

U.S. SENATE, SUBCOMMITTEE ON HOUSING, TRANSPORTATION, AND

COMMUNITY DEVELOPMENT, COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, Washington, DC. 

The Subcommittee met at 2:03 p.m., in room SD–538, Dirksen 

Senate Office Building, Senator Robert Menendez (Chairman of the 

Subcommittee) presiding. 

OPENING STATEMENT OF SENATOR ROBERT MENENDEZ 

Senator MENENDEZ. This hearing will now come to order. Good 

afternoon, everyone. Today the Banking Subcommittee on Housing, 

Transportation, and Community Development will have its first 

hearing on public transit as we prepare to write the reauthorization of the surface transportation bill. I want to thank Chairman 

Dodd and Senator Shelby for their continued leadership on transit 

issues, and I look forward to working with them and Senator Vitter 

on crafting a strong transit title. 

Public transit has not always had the easiest time in recent 

years. The previous administration and many in Congress seemed 

more concerned about transit justifying its existence rather than 

trying to make transit flourish. This has meant an increasingly onerous system for transit agencies to get through in order to get 

funding. Projects have to be justified on a rigid cost/benefit analysis 

that can often ignore factors like economic development. 

Transit agencies have had to do stringent modeling on projected 

ridership 2 years out, even though these systems will be in service 

for decades. And often, as new requirements have been added, 

agencies have had to go back and redo work already completed to 

meet new standards. 

These new requirements have resulted in the new starts process 

taking 15 to 20 percent longer, according to the FTA, and these 

delays, along with the added costs associated with them, mean that 

we are not building new transit projects at the rate we could or 

should be. 

I want to be clear on one point. I am not questioning the excellent work of the Federal Transit Administration. They have done 

a remarkable job of promoting transit in recent years. What I am 

saying to the FTA and to the transit agencies is that now, it appears to me, is the time to unleash transit. The leadership of President Obama, Chairman Dodd, and the new FTA Administrator 

Peter Rogoff means that transit is no longer something we need to 
2 

justify; it is something we need to understand is central to many 

of our Nation’s core policy issues. 

Transit can help us rebuild our economy by creating jobs and fostering smart economic growth. Transit systems can help us out of 

our housing crisis because new transit can increase property values 

and lower rates of foreclosure. Transit can help us improve our energy security by lowering our consumption of oil. And transit can 

also help us lower greenhouse gas emissions to help solve our climate crisis. There are few things that bring together all of those 

possibilities as public transit can. 

I have personally seen these benefits in the success of the Hudson–Bergen Light Rail in New Jersey, which created new riders, 

new ratables, new businesses and investment, new employment opportunities, and environmental improvement all along New Jersey’s Gold Coast. And I could continue to extol the benefits of transit, but instead I will let the decisions of our constituents speak for 

themselves. 

Transit ridership is higher now than it has been in 40 years. 

Communities around the country, including Denver, Houston, Dallas-Fort Worth, Salt Lake City, Atlanta, Sacramento, Norfolk, and 

Charlotte have all made substantial investments recently in transit. So it is not just a question of meeting our policy goals; it is also 

a question of meeting increased demand for transit. 

This administration has already signaled its intent to meet this 

demand in the Recovery Act, which had $750 million in transit 

funding, created $1.5 billion in additional commitment authority 

for new transit projects, and I am sure that transit will play a significant role in the $1.5 billion Transportation Investment Generating Economic Recovery Discretionary Grants program. 

So as I see it, our job for this reauthorization is to continue the 

work of the Recovery Act and provide the funding and a more 

streamlined process to ensure transit can meet its potential. When 

we are done, transit can come out of the shadows and finally be 

a proud part of the country’s transportation policy and its future. 

Seeing no other colleagues at this point—we will recognize them 

when they get here—let me turn to our witnesses. 

Ms. Nikki Clowers is currently the Acting Director of Physical 

Infrastructure with the Government Accountability Office. In this 

role, she has led evaluations examining the Federal Transit Administration’s New Starts program. Ms. Clowers has been with GAO 

for 11 years and has done a lot of work reviewing the New Starts 

program, so we look forward to learning from their insights. 

Mr. Gary Thomas is the President and Executive Director of the 

Dallas Area Rapid Transit (DART). In this role, Mr. Thomas is responsible for a 13-city transit system over a 700-square-mile area 

with bus, light rail, commuter rail, and paratransit services. Mr. 

Thomas is also Vice Chair of Rail Transit for the American Public 

Transportation Association. 

Let me welcome Mr. Richard Sarles, who is the Executive Director of New Jersey Transit, whom I have worked quite a bit with— 

you do not look worse for the wear, Richard, so we appreciate your 

service—the third largest transit agency in the Nation. Mr. Sarles 

is responsible for the agency’s bus, light rail, commuter rail network which has been used by more than 240 million people every 
3 

year. It has been a tough time to be head of New Jersey Transit. 

We have several major capital projects going in various stages of 

construction or planning, we have record ridership, and we have severe budget constraints. And you have managed to guide New Jersey Transit through all of this and to be able to do it without raising fares this year, which I for one appreciate. 

Ms. Mariia Zimmerman is Policy Director at Reconnecting America, a national transportation nonprofit devoted to improving the 

connection between transportation systems and the communities 

they serve. Mariia brings over a decade of experience working on 

Federal transportation policy, both in the Federal Transit Administration and on Capitol Hill with Chairman Earl Blumenauer. 

Thank you all very much. I would ask each of you to keep your 

testimony to about 5 minutes. Your full written testimony will be 

entered into the record, and with that, Ms. Clowers, let us start 

with you. 

STATEMENT OF A. NICOLE CLOWERS, ACTING DIRECTOR, 

PHYSICAL INFRASTRUCTURE ISSUES, GOVERNMENT 

ACCOUNTABILITY OFFICE 

Ms. CLOWERS. Thank you, Mr. Chairman, for having me here 

today to speak about FTA’s New Starts program, both challenges 

that the program faces as well as options to improve it. 

As you know, the New Starts program is the primary source of 

Federal funding for major transit projects throughout the country. 

However, there are growing concerns that the process has become 

too time-consuming, too complex, and too costly. Minimizing the 

delays and costs of project delivery has never been more important 

as all levels of Government face severe financial stress. 

The bottom line is that there are options to help projects move 

through the process more quickly. However, it is important that we 

strike the right balance between speeding project development and 

maintaining a robust evaluation process. 

My testimony will address two topics: first, challenges we have 

previously identified with the program; second, potential options to 

expedite project development. In terms of challenges, we have previously identified three key issues. 

First, the New Starts program has experienced a great deal of 

change over the last decade. Although these changes were generally intended to make the program more rigorous, the frequent 

changes have at times caused confusion and rework on the part of 

project sponsors, leading to delays in project development. 

Second, the current New Starts evaluation process does not capture all project benefits, such as economic development, as you 

mentioned. As a result, the process may underestimate the benefits 

of certain projects. 

Third, while project sponsors and the industry experts we interviewed generally value the rigor of the New Starts process, many 

are concerned that the process has become too complex, too timeconsuming, and too costly, leaving some to question whether pursuing New Starts funding is worthwhile. 

For example, one project sponsor told us that constructing a 

project with New Starts funding delays the timeline for the project 

by as much as several years, which in turn leads to increased 
4 

project costs, since inflation and expenses from labor and material 

increase with delay. 

With regard to options to expedite project development, we have 

identified a handful of potential options in our ongoing work, which 

are described in my written statement. Each of these options has 

advantages and disadvantages to consider. I would like to highlight 

two of these for you today. 

One option is to tailor the New Starts evaluation process to the 

risks posed by the project. Specifically, the level of oversight by 

FTA and the number of requirements to be fulfilled by a project 

sponsor could vary based on the project’s cost and scope as well as 

the experience of project sponsors. This would allow low-risk 

projects to move through the process more quickly as well as allow 

FTA to more efficiently use its limited oversight resources. 

Another option is to combine one or more of the project development phases. For example, the preliminary engineering and final 

design phases could be collapsed into a single phase. This would reduce the number of FTA approvals needed to advance the project 

through the process. Currently FTA must approve a project’s advancement into the different phases. Gaining these approvals can 

cause delays as project development essentially stops as FTA determines whether the project can advance, and FTA’s reviews can 

take anywhere from a few weeks to many months. Thus, combining 

project development phases would reduce the number of stops and 

starts projects currently experience and reduce the potential for 

delay. 

In summary, there are several challenges confronting the New 

Starts program, notably concerns that the process has become too 

complex, too time-consuming, and too costly. However, there are 

options to help expedite project development. Options to speed 

project development must be balanced with the need to preserve 

the rigor and accountability of the New Starts program. 

We look forward to working with the Subcommittee to further explore these options during the upcoming reauthorization, and this 

concludes my testimony, Mr. Chairman. I would be pleased to answer any questions that you or the other Members of the Subcommittee may have. Thank you. 

Senator MENENDEZ. You are under time and on budget. That is 

always good news. 

Ms. CLOWERS. That is what we try to do at GAO. 

Senator MENENDEZ. Thank you very much. 

Before I turn to Mr. Thomas, let me turn to my distinguished colleague from New York, Senator Schumer. 

STATEMENT OF SENATOR CHARLES E. SCHUMER 

Senator SCHUMER. Thank you. First, I want to first thank Senator Menendez and Senator Vitter for holding this important hearing. I thank the witnesses. I apologize. I cannot stay for the hearing with other obligations, but I wanted to be here because I think 

New Starts is a great idea, and I am glad you are having this hearing, Mr. Chairman. 

From the Internet to common markets, from higher education to 

startup businesses, the economy is fundamentally based on 

interconnectivity. Allowing ideas and the people who devise them 
5 

to move ever more freely from place to place. That is why safe and 

smooth highways and bridges matter. It is why better and faster 

rail travel matters. And it is why inexpensive, reliable mass transit 

matters. With the unpredictability of fuel prices and growing traffic 

congestion, it is now more important than ever that Americans 

have an affordable alternative means of transportation. 

In 2007, Americans took 10.3 billion trips on U.S. mass transit. 

That is the highest number taken in 50 years. Today we are in a 

very promising place. We have an administration that understands 

and is willing to invest in the growing demand for transit and an 

American public whose imagination has been captured by the 

promises that modernized transportation systems can deliver. So 

the environment is ripe to move in a bold new direction. 

To take advantage of these new opportunities, we have to 

prioritize the improvement to the Federal Transit Administration’s 

New Starts program, a major capital investment program that 

helps localities build fixed guideway systems. New Starts has been 

incredibly important to my home State. In New York City, East 

Side Access, the Second Avenue Subway, and a joint project spearheaded by my colleagues, the Chairman of this Subcommittee, Senator Menendez, along with Senator Lautenberg are all beneficiaries 

of New Starts. The projects will play an instrumental role in relieving roadway congestion and reducing New Yorkers’ carbon emissions. 

The East Side Access project brings Long Island Railroad commuters to a new terminal underneath Grand Central Station in 

Manhattan, allowing them to avoid the congested headache that is 

Penn Station. 

The Second Avenue Subway project will create a two-track subway line along Second Avenue from 125th Street to the financial 

district in Lower Manhattan, creating a critical but presently missing link in New York City’s subway map. 

The ARC Tunnel—and I am sure my friend from New Jersey can 

speak about this, and has probably mentioned it already—will double commuter rail capacity between New York and New Jersey via 

two new railroad tunnels underneath the Hudson. 

The existing tracks that are in use are bursting at the seams in 

terms of capacity on both sides of Manhattan—on the East River 

for East Side Access, on the West Side for the Hudson River. You 

get one train stalled during rush hour, and everything comes to a 

standstill because things are so congested. So the project is going 

to provide riders with welcome relief. 

But the New Starts program is not without its shortcomings. The 

entire project development process takes anywhere from 6 to 12 

years. This is a lifetime for localities gasping for fresh air, anxious 

to get cars and their accompanying pollution off their streets. It 

took almost 9 years for both East Side Access and Second Avenue 

Subway to receive their Full Funding Grant Agreements. ARC is 

still awaiting the FFGA. Part of the delay is due to the FTA’s 

heavy oversight role over each step of the project’s development. 

While I agree that the Federal Government must monitor the use 

of its funds carefully, especially in multi-million-dollar capital 

projects, I believe the Federal Government must not act as a roadblock to the project’s completion. Congress must examine ways to 
6 

make the New Starts program more efficient so that our localities 

are encouraged not discouraged from applying for projects. 

Another important note on transit investment I would like to 

make is that as we approach the new reauthorization bill, I am 

going to reiterate the importance of striking a proper balance between highway funding and mass transit funding. We all remember last summer when the Highway Trust Fund nearly dried up. 

The Bush administration’s solution was to inject it with funds— 

funds that would be robbed from mass transit. 

Bottom line: You cannot rob Peter to pay Paul. Mass transit 

funds are more precious than ever, and we must dismiss any future 

proposal to subtract funding from mass transit. 

Again, I want to thank Senator Menendez for holding this hearing, thank the witnesses, and I will look forward to reviewing the 

record and seeing their testimony. 

Senator MENENDEZ. Thank you, Senator Schumer, for your tremendous advocacy in this regard. 

Mr. Thomas. 

STATEMENT OF GARY C. THOMAS, PRESIDENT/EXECUTIVE 

DIRECTOR, DALLAS AREA RAPID TRANSIT (DART), AND VICE 

CHAIR—RAIL TRANSIT, AMERICAN PUBLIC TRANSPORTATION ASSOCIATION (APTA) 

Mr. THOMAS. Mr. Chairman and Members of the Subcommittee, 

on behalf of Dallas Area Rapid Transit and the American Public 

Transportation Association, we thank you for this opportunity to 

testify before you today on the Federal Transit Administration’s 

New Starts program, which provides essential funding to cities like 

Dallas who seek to improve mobility and air quality by establishing 

new transit services. Changes must be made to the program that 

will help streamline the Federal transit program, reduce the administrative burdens on transit agencies like ours, and help speed 

project delivery. 

Now, when you think about public transit in the United States, 

DART may not be the first transit authority you think of, and let 

me tell you a little bit about what is going on in north Texas. North 

Texas is the fastest growing region in the United States. It is the 

fourth largest region in the United States. DART serves 13 cities 

in just a portion of that region, 2.2 million people, over 700 square 

miles, and we started that process in 1983, so we are relatively 

young when it comes to public transportation certainly in the U.S. 

We opened our first light rail section in 1996, and then we had 

an expansion in 1997 and 2002. So we opened with a 20-mile starter system. Between 2001 and 2004, we expanded to a total of 45 

miles on the ground. In that second expansion, we received a $333 

million Full Funding Grant Agreement. We actually came in ahead 

of schedule and under budget on that project, which created somewhat of a dilemma because it had not happened very many times 

in the past. We worked very closely with our delegation to reapply 

some of those funds back to the north Texas area. 

As we continue to try to provide this response to the insatiable 

desire for good transportation choices in north Texas, where people 

spend 60 hours on average a year stuck in traffic—not in traffic, 

but stuck in traffic—we continue to look at how we can continue 
7 

to grow. So we have 45 miles of light rail on the ground. We also 

provide commuter rail between Fort Worth and Dallas. We operate 

the HOV lanes, and of course, buses, paratransit systems, and 

other multimodal opportunities for people to use, and we are in the 

process of doubling our light rail system again. We have the longest light rail construction project underway in North America right 

now, 28 miles, the Green Line. Often when I talk to folks in north 

Texas and ask, ‘‘Do you ride the system?’’ ‘‘Well, Gary, it does not 

go where I want it to go yet. And how quickly can you make that 

happen?’’ 

So we are in the process of building the 28-mile Green Line; 21 

miles of that is federally funded, $700 million Full Funding Grant 

Agreement that we received on July 3, 2006. That represented 47 

percent of the project cost; 53 percent is locally matched. And then, 

of course, that balance of the 28 miles, the final 7 miles is all locally matched. 

The process that we went through to get to that point was often 

long and arduous, and to be quite frank with you, sir, the FTA was 

very helpful in that process. They have extremely bright people and 

very helpful people, but the process was cumbersome, oftentimes, 

and it changed multiple times, as we heard earlier in the testimony, as we went through that process. But we received that Full 

Funding Grant Agreement. That project, the first phase of that 

project will open September 14th of this year. The rest of that 

Green Line expansion will open in December of 2010, but we are 

not stopping there. We have already got an additional 9 miles 

under contract that we just awarded this January as we head toward DFW airport and another 5 miles as we head out to the eastern suburbs of the Dallas area. 

So total right now today, we have 42 miles of light rail under 

construction. And as we talk to the community, it is, ‘‘OK, Gary, 

that is $1.63 billion of construction. What are you going to do next? 

How quickly can you get that next piece? When are you going to 

do this piece?’’ And we are looking at how we can make that happen as we continue to expand our system. 

We owe a lot to our north Texas delegation, and, of course, Senator Hutchison, who serves on this Subcommittee, we appreciate 

what she is doing. As we look forward, the funding is absolutely 

critical, $123 billion is absolutely necessary over the 6-year period 

for transit in the new bill. We would like to strengthen the role of 

the regional FTA offices in the New Starts process. We really believe that we need to reform the ratings standard to take more benefits of the other criteria: land use, TOD, environment. We have almost $8 billion of transit development already around our stations, 

and, of course, a greater use of pilot and demonstration projects 

would be beneficial. We have got a second alignment downtown 

Dallas that is a perfect opportunity for this. It does not meet the 

current criteria, but it is absolutely essential, as all lines feed into 

downtown so that we do not create a bottleneck in the future. 

I look forward to working with the Subcommittee as we continue 

to develop these rules, and I appreciate the opportunity to be here 

today. 

Senator MENENDEZ. Thank you very much. 

Mr. Sarles. 
8 

STATEMENT OF RICHARD SARLES, EXECUTIVE DIRECTOR, 

NEW JERSEY TRANSIT 

Mr. SARLES. Mr. Chairman, it is a pleasure and I appreciate the 

opportunity to give testimony today on the New Starts process. 

Congress and the Obama administration, through the American 

Recovery and Reinvestment Act, have sent a strong signal to the 

American public that improving and expanding public transportation is a priority. 

It is precisely because we stand at the gateway of a new era in 

transit investment that it is critical to ensure that, going forward, 

we have the most expeditious and transparent process to deliver 

critically needed projects both at the agency and Federal levels. 

First, let me say that we are very pleased to be working with 

FTA Administrator Peter Rogoff. The Administrator is an extremely knowledgeable transportation expert with considerable experience with New Starts through his work on the Senate Appropriations Committee. He has been a friend to transit for many 

years and has already hit the ground running, working with us 

closely in New Jersey to advance New Starts projects. I look forward to his leadership and partnership at FTA. 

The FTA has an important, welcomed oversight role in the New 

Starts process that was designed to realize the benefits for money 

expended and to ensure both the competitive nature of the program 

and the proper usage of Federal funds. 

What I hope to address today is the fact that the FTA, like New 

Jersey Transit, has limited resources to devote to these valuable 

oversight responsibilities. FTA must focus its resources to assure 

that the costs and benefits of a project are fairly presented and 

that a grantee has in place the requisite organization, funding, 

processes, and controls to advance and sustain a project. The FTA 

does not have nor should have the expertise to plan, engineer, and 

construct major projects. Nor should it request or demand reams 

of documentation with multiple revisions from clearly experienced 

agencies to prove that they know how to plan, engineer, and construct a New Starts project. 

While we have worked through the years on multiple New Starts 

projects that have yielded tremendous benefits, our experience 

shows a more recent trend toward layers of oversight that can create risks to project schedules and budgets. 

Specifically, New Jersey Transit has completed four New Starts 

projects since the program’s inception, including the Frank R. Lautenberg transfer station, the Hudson–Bergen Light Rail Segments 

1 and 2 that you referred to earlier, and the Newark Light Rail extension. In addition, New Jersey Transit has also completed the 

Riverline Light Rail project with State funds only. The total value 

of these projects was $3.9 billion. 

Let me share New Jersey Transit’s experience with the New 

Starts process on two major projects—one in operation, and one 

about to break ground this month. 

The first, the Hudson–Bergen Light Rail project, which is operational today, offers frequent and convenient service through seven 

cities along the Hudson River waterfront. 

It is important to note that during the project’s early stages 

then-Mayor Menendez of Union City was not only an advocate of 
9 

the project, but convinced New Jersey Transit to add a station in 

Union City, which now has over 5,000 daily riders. The HBLR—— 

Senator MENENDEZ. By the way, Mr. Sarles, at that time—you 

were not the Executive Director, but at that time I was told that 

was not going to happen. And I told them, ‘‘Then we are not going 

to have a rail line.’’ It is the most highly traveled passenger location of the entire system, is it not? 

Mr. SARLES. It was a very wise decision. 

Senator MENENDEZ. Thank you. All right. You can have as much 

time as you need. 

[Laughter.] 

Mr. SARLES. The HBLR has been a huge driver for economic development in Hudson County. In fact, in a region where cities are 

shrinking, Jersey City in the last quarter-century has gained about 

30,000 residents, 27,000 jobs, and 18 million square feet of prime 

office space. 

New Jersey Transit’s experience with FTA in securing Full Funding Grant Agreements for the HBLR in the late 1990s was fairly 

straightforward. 

New Jersey Transit, in partnership with the Port Authority of 

New York and New Jersey, is also in final design and will soon 

break ground on the Access to the Region’s Core (ARC) project— 

the first new rail tunnel to be built under the Hudson River in 100 

years. That was referred to before. This $8.7 billion project will 

generate some $45 billion in new regional economic activity while 

providing riders with more frequent, direct, and reliable service. 

The tunnel will accommodate a 50-percent increase in the number 

of daily passenger trips beneath the river, taking 22,000 cars a day 

off area highways, and reducing greenhouse gases and other pollution by more than 66,000 tons per year. 

The New Starts process in 2005, when we began submitting information for ARC, has changed substantially from the days of the 

HBLR. Some changes were positive. For instance, FTA required a 

fleet management plan for all transit modes, a financial plan, a 

2030 rail operating plan, and a land use and economic development 

analysis. The process enforces a discipline on the logic used to develop and analyze a plan, which is useful so that comparisons can 

be made between different proposed transit projects and also so 

that the proposing agencies have the resources and skills they need 

to implement the project. I welcome that discipline. 

However, in an environment where investments need to be accelerated to boost the economy and protect the environment, review 

timetables need to be balanced against the need to progress 

through the process with a focus on completion. 

For example, the current New Starts process has evolved to include many more layers of review, and re-review, which are sometimes onerous and can unnecessarily slow an agency’s ability to advance on a reasonable schedule. Even modest changes to a project 

now result in more process. In fact, I can say with some certainty 

that if a mayor requested an additional station for a New Starts 

project today—a request that would improve the project through increased ridership and economic development—the result would be 

project delay and cost overruns or increases. 
10 

With these experiences in mind, I recommend the Committee 

consider the following steps with respect to reforming the New 

Starts process. In order to meet the administration’s objectives 

while providing appropriate oversight, the program should embody 

five fundamental principles: 

One, establish a true partnership between the Federal Government and State and local governments seeking to improve public 

transit bound together by mutual respect rather than red tape. 

Streamline the New Starts process so that predictability of the 

process is a priority. One way to accomplish this is to make it more 

of a ‘‘procurement’’ type process. 

Three, realign the review process to account for the experience 

of more established transit agencies. 

Four, acknowledge the fact that the FTA has become the minority funding partner and further recognize that a Full Funding 

Grant Agreement limits the exposure of the FTA to fund more than 

a specified amount of the proposed project’s total cost. At the same 

time, the local agencies bear the risk of cost increases, including 

those due to delay in decisionmaking. 

Five, encourage the expansion of public transit consistent with 

concerns about production of greenhouse gases and energy consumption. The weight given to evaluation criteria categories should 

be revisited. 

I deeply appreciate the Committee’s leadership on this matter. It 

is absolutely critical that if we are to achieve the ambitious agenda 

of building and expanding transit infrastructure across the country, 

we need to streamline the Federal process and work more urgently 

together as partners at the Federal, State, and local level. I am 

grateful for the opportunity to offer our thoughts today on how we 

can work together to build a better transportation network. 

I would be glad to take questions. 

Senator MENENDEZ. Thank you very much. 

Ms. Zimmerman. 

STATEMENT OF MARIIA ZIMMERMAN, POLICY DIRECTOR, 

RECONNECTING AMERICA 

Ms. ZIMMERMAN. First of all, thank you for your long-time leadership on transit and economic development issues, Senator 

Menendez. It is a great pleasure to be here today, and in my organization’s work managing the federally funded Center for TransitOriented Development, we have been engaged in a number of research projects over the last 5 years to look at the New Starts program and, as a co-founder of the Transportation for America Campaign, are looking at opportunities in the next transportation bill. 

In a report that Reconnecting America released last year, we 

found over 400 rail, bus, rapid transit, and streetcar projects that 

are being proposed in almost 80 communities across the country at 

a proposed worth of $248 billion—far more than can be funded 

through the Federal transit program alone and at the current rate 

would take almost 100 years to build these projects. 

Regions are aggressively seeking to use transit investments to 

help focus growth, create sustainable foundations for economic development, and provide mobility options for residents. My organization joins a growing chorus of voices that asks Congress to signifi-
11 

cantly increase funding for public transportation in the upcoming 

transportation reauthorization, and as part of overall energy and 

climate change legislation that may be before the Senate this Congress. 

Increased investment in public transportation should be viewed 

as part of a larger goal to build and maintain an integrated national transportation system. And last month, Senators Rockefeller 

and Lautenberg introduced S. 1036, the Federal Transportation 

Policy and Planning Act of 2009. This legislation establishes a unifying mission for the Federal surface transportation program and 

sets needed and achievable performance targets. This Subcommittee may want to consider strengthening that bill to reinforce 

the linkage between housing and transportation through adding 

performance targets that ensure low- and moderate-income communities also share in the benefits of a new and improved transportation system. And to help meet growing demand for transit, the 

New Starts program, as we have all mentioned, must be significantly reformed. 

My organization supports a rigorous and transparent review 

process; however, the unlevel playing field between the current 

process for planning, designing, and constructing a new transit line 

unduly burdens these projects with extra costs and delays. 

Our research on existing and proposed transit projects shows 

that actual ridership on many recently built transit lines is higher 

than predicted by FTA’s Transit System User Benefit model. This 

raises significant concerns about the substantial weight placed on 

these model results, and we believe validates the need to maintain 

a multi-measure approach. 

Additional suggestions to improve the New Starts project delivery process that we believe warrant more consideration by Congress include: 

The development of a metropolitan mobility program that could 

allocate formula funding for small start capital transit investments, 

thereby increasing the threshold and maintaining an exemption for 

smaller-scale transit projects; 

The advancement of a set of interrelated expansion projects, 

similar to the approach taken by Salt Lake City and being pursued 

by Houston, Texas; 

And reconciliation of the major capital investment alternatives 

analysis with the NEPA Alternatives Analysis requirement to create one integrated comprehensive approach instead of a confusing 

two-step process. 

Finally, I would like to highlight some of the social equity needs 

of transit-supportive land use policies. As the transit-oriented development market demand increases, as you have seen in New Jersey’s Gold Coast, the threat of displacement will force the loss of 

potential affordable housing options. 

We commend the recently announced HUD–DOT interagency 

sustainability partnership. But in regards to the New Starts process, we feel that more can be done and should be done to simultaneously improve project delivery and reward affordable housing 

preservation and creation. One idea is to allow communities to 

count mixed-income housing investments within a half-mile of a 

proposed transit station as a match against requested Federal dol-
12 

lars. We also believe that focusing the Federal review process on 

the Federal portion of funding would help to incentivize local actions in the realm of economic development. 

Another option is to reward communities that implement mixedincome housing policies in the land use evaluation measure, thus 

moving beyond just reporting on the number of low-income households to actually rewarding those communities that take steps to 

ensure long-term affordability for families of a mix of incomes. 

The Federal New Starts program sets the rules for engagement 

in how communities coordinate proposed transit investments with 

larger regional decisions, and as noted, we believe the challenges 

facing our Nation on climate change, economic security, energy security, and competitiveness require us to make a greater effort to 

fund transit in a more timely and cost-effective manner for transit 

properties and communities. 

Thank you very much for this opportunity to appear before the 

Committee today. My organization looks forward to working with 

you and this Committee in the upcoming bill. 

Chairman MENENDEZ. Well, thank you very much. Thank you all 

very much for some very good testimony. We appreciate it. 

So we will start rounds of questioning, and I don’t know if other 

colleagues will make it. If not, believe me, I have a series of questions. 

Let me start with you, Ms. Clowers. You note in your testimony, 

in your full written testimony, that economic development is a benefit that is not considered when FTA rates New Starts projects, 

and I worry that a project like the experience we had in New Jersey along the Hudson–Bergen Light Rail, and even listening to Mr. 

Thomas about some of what he described in the development in the 

DART region, but in the New Jersey context alone, it generated 

well over $5 billion in housing development alone, without even 

getting into the commercial aspects of it. It would not be fairly 

rated if it had come through the process today rather than in the 

1990s. So how can we create a fair measure of economic development so that it can become part of the New Starts process? 

Ms. CLOWERS. As you stated, economic development is currently 

not considered or weighted in the evaluation process. Cost effectiveness and land use are each weighted 50 percent in the evaluation 

process. The Transportation System User Benefit does capture 

some economic development benefits. However, we found in the 

past that it doesn’t capture all the economic development benefits 

that a project might bring. There are models out there that would 

allow you to predict economic development benefits that project 

sponsors can use and some project sponsors have those models. 

They can be quite expensive. 

Another way to incorporate that information into the process, if 

you don’t want to go the quantitative approach of using models, is 

to use a more qualitative approach. Currently, that is what is done 

with land use. FTA considers the transit-friendliness of the policies 

that a community may have in determining the land use benefits 

and a similar approach can be taken for economic development. 

Chairman MENENDEZ. Any other thoughts on that? Does anyone 

want to jump in? Mr. Thomas? 
13 

Mr. THOMAS. Yes, sir. I think the modeling is a good idea. The 

land use policies in our particular case are also a good idea, but 

it is somewhat of a challenge with 13 different member cities because they all approach it a little bit differently. What we would 

also like to see is some of the historical practices that have already 

occurred around the stations, which I think tend to influence other 

developers and tend to gain momentum as we go forward. As I said 

earlier, we have almost $8 billion of development that is either occurring around stations or already has occurred around the stations, so I think that historical perspective and the past practices 

of what has gone on around those stations, I think is also very important. 

Chairman MENENDEZ. Mr. Sarles? 

Mr. SARLES. If I may add, on a very large project, such as the 

ARC project, use of an economic model makes sense and we, in 

fact, did that. On the smaller New Starts, not necessarily a small 

New Start project but smaller ones, I think more of a qualitative 

approach works best in that you see how the localities have zoned 

around the proposed station so that, in fact, will encourage that 

kind of economic development. 

Chairman MENENDEZ. Ms. Zimmerman? 

Ms. ZIMMERMAN. Thank you. We actually have done a fair 

amount of work on this, as well, through the Center for TransitOriented Development and commissioned some different reports to 

look at this. One of the issues we found frustrating to this point 

has been, I think, a confusion over the definitions of economic development, particularly coming out of the administration. When we 

talk to practitioners who are looking at economic development, they 

are really looking at the land valuation increases and what policies 

are communities doing to create tax increment financing tools, 

business improvement districts, public–private partnerships, developer agreements, and there is a host of these kinds of qualitative 

things that can be evaluated and measured versus more of a pure 

economist perspective of looking at sort of microeconomic trends 

which involve detailed modeling. 

And we feel that there are ways through these qualitative measures that it could be analyzed, and that there is a clear distinction 

between land use and economic development if we work to clearly 

define what we mean by these terms. And we do find in countries, 

in Canada and Europe and other places, they take more of a full 

cost-benefit analysis to look at the full range of costs and benefits. 

That may be another approach that we would want to consider to 

sort of get at these bundle of issues in the next bill. 

Chairman MENENDEZ. Let me ask you, Ms. Clowers, again, GAO 

has taken some extensive looks at the New Starts program and you 

have issued several reports to the agency. One of the issues that 

I have raised time and time again and we heard it here on the 

panel is that the New Starts process should really be quicker. I 

mean, a decade—there is nothing that a decade ago is more expensive then than it is now. It is far more expensive now, after a decade, and that is a challenge. The question is what recommendations you all may have when it comes to how do you shorten the 

process while still ensuring a fair vetting process. 

Ms. CLOWERS. That is a very good question. We do in our—— 
14 

Chairman MENENDEZ. I only ask good questions. 

[Laughter.] 

Ms. CLOWERS. Absolutely. 

Chairman MENENDEZ. Just kidding. 

Ms. CLOWERS. We have identified a number of options to help 

streamline the evaluation process. As I mentioned before, we could 

tailor the evaluation process to the risk posed by the projects. We 

also could apply changes to the New Starts program or process only 

to future projects. So, for example, if you are already in preliminary engineering and FTA makes a change to the process, you 

would not apply the change to that project. Through our past work, 

we have found that is a significant pain point for project sponsors. 

They feel like the goalposts are always changing on them and it 

again requires rework and delays and cost. But as you mentioned, 

it is key that we strike the right balance between speeding project 

development and maintaining a robust evaluation process because 

we have held up the New Starts program as a model for other 

agencies in terms of the rigor and analysis that goes into selecting 

these projects. 

I would go back to the idea of looking really at the risks posed 

by the projects and determining the right balance. What is the risk 

posed to the Federal Government? For example, you could tailor 

the process so that if you are requesting more Federal funds from 

FTA, you would experience greater Federal oversight than if you 

are requesting less. 

Chairman MENENDEZ. What about Mr. Sarles’ comments—I was 

taking down your five notes—a recognition that while a full funding agreement is something that is desirable to get a project going, 

it also limits the Federal Government’s risk, right, to the extent 

that that is the extent of their engagement. So if their costs go up, 

it is the other entity, New Jersey Transit or others, who ultimately 

are the ones responsible for the difference. 

Ms. CLOWERS. Correct. 

Chairman MENENDEZ. You know, I have heard full-funding 

agreements described in many ways. I never really thought about 

it in the context of limiting the government’s risk. I think it is worthy of noting. 

I want to ask you one other question and then I will turn to the 

others. There were a series, I think, and I would like you to talk 

about it—you know, we all understand that a program goes 

through evolutions and adds things as it learns more experiences 

with specific projects, but can you identify for the Committee some 

of the major requirements the FTA added outside of the statutory 

process via the regulatory and administrative changes in the last 

administration? 

Ms. CLOWERS. I think one of the most significant regulatory 

changes was the introduction of the Transportation System User 

Benefit, which is used to help calculate cost effectiveness. As you 

know, SAFETEA–LU identifies cost effectiveness as a project justification criteria that FTA must use to evaluate projects, and then 

FTA then looks at those criteria and develops certain measures. 

And the TSUB measure was a significant change. I think that was 

in the early 2000s. When that rolled out, that caused a great deal 
15 

of problems for project sponsors. It was a new calculation that was 

very complex, led to rework and some delays of projects. 

Other requirements that would fall more into the administrative 

regulatory realm, they mentioned risk assessments for projects and 

those risk assessments have evolved over time in terms of its complexity and the timing of the risk assessments. They have also introduced ‘‘make the case’’ documents where projects are required to 

submit a three- to four-page narrative that explains the benefits of 

the projects in layman’s terms. That might not sound like a lot of 

work in terms of the three to four pages, but there is a lot of back 

and forth between project sponsors and FTA in terms of getting the 

document to look like what FTA wants. 

There has been a significant number of other changes made. I 

think about 3 years ago, we identified about 16 administrative or 

regulatory changes that FTA had made, and importantly, a number 

of those changes had not been made with the review and comment 

period. And so we recommended to FTA that they ensure that all 

project sponsors have an opportunity to review and comment on 

proposed changes because we think that is important to get both 

input from the project sponsors, sort of real-world perspective 

about what those changes will do, and also to avoid confusion and 

delay. 

Chairman MENENDEZ. Mr. Sarles, Senator Schumer mentioned 

something that we have all regionally been working on and break 

ground Monday, I understand, the new Trans-Hudson Rail Tunnel 

project, and that has undergone an incredibly strenuous process. If 

you could change one thing about the New Starts program, what 

would it be so that the next nationally significant project can complete the process in less than a decade, which is what this took? 

Mr. SARLES. If there was one thing I would do, it is to considerably improve the predictability of the process, the timing of it. As 

it is set up now, there really is no specific deadline to move on to 

the next phase of the evaluation. 

I had mentioned in my testimony to maybe have sort of like a 

procurement process, where every year, once a year, properties that 

are interested in applying for the New Starts program have to submit their proposal. The FTA could then spend 2 months evaluating 

them and scoring them and picking out the successful ones, and 

the ones that were unsuccessful will have an opportunity to come 

back, learning from the first round. 

Interestingly enough, yesterday, I was at the FRA’s workshop on 

implementing the $8 billion high-speed rail stimulus program and 

they talked about exactly that process, where they are going to 

submit, I think toward the end of this month, guidance. In 2 

months, organizations are to submit the applications, and they are 

going to have a first round of choices after evaluating the various 

proposals. Something like that moves things along, gets decisions 

made, and continues on. 

Chairman MENENDEZ. Mr. Thomas, you in your testimony, you 

mentioned that adding capacity in the core area of your central 

business district as the type of project that does not meet the current New Starts requirements. How do you think, and do you think 

we should make projects such as expanding station platforms or 
16 

similar efforts a part of the future New Starts program, or do you 

think core capacity should be its own program? 

Mr. THOMAS. You know, I think at every level, as you improve 

a system, I think those should be opportunities for Federal funding. 

Now, I also think that the level of review by the FTA should be 

commensurate with the size of the project. In other words, one of 

the challenges we have right now is that it doesn’t really matter 

what size the project is. You get the same approach and the same 

level of review. 

So if it is a station expansion that may be absolutely critical to 

the continued success of the system and to the folks that are riding 

the system, if you have to go through that same process, you are 

going to, as Mr. Sarles said, early on, you have got to make a decision. Am I going to follow the Federal process? Am I going to pursue Federal funds or am I not? And we as providers have to make 

that decision early on in the process because sometimes that can 

mean millions of dollars of additional cost and years of additional 

time, and so we have got to weigh those risks. But I think all 

projects certainly should have the opportunity. 

In our particular case, our system right now is a hub-and-spoke 

kind of system. We are early in our development of the second 

Downtown Dallas alignment. Although we will have almost 93 

miles on the ground by 2014, all of those lines come into downtown, 

and by adding that second alignment, the TSUB number really 

doesn’t work out. We don’t meet the criteria. But it is absolutely 

vital to the success of the system that we don’t bottleneck through 

that single alignment that we have right now. And so I think there 

is certainly a need to either change the criteria to allow those types 

of projects or to have more flexibility and demonstration projects on 

how we can do some things differently and what those options 

might be. 

Chairman MENENDEZ. Ms. Zimmerman, let me ask you, you 

mentioned in your oral testimony about the survey your organization has done with reference to how many more projects seeking 

New Starts funding there are than, in fact, funding that is available. Do you have an estimated amount of annual New Start funding that would address the need you anticipate in the next transportation bill so that we can seek to accomplish some of our economic recovery, energy savings, and land use costs? 

Ms. ZIMMERMAN. Sure. Thank you. Of the almost 400 projects 

that we have identified, a number of those for reasons cited are 

going outside of the New Starts project, and I think it is actually 

a fair expectation that the Federal Government does not need to 

pay for every single new transit project in the country. But we do 

feel that the Federal funding level should be significantly increased. It has been about one to one-and-a-half to now $1.9 billion 

for New Starts funding per year. We think that we should see at 

least $6 to $8 billion per year in the next bill or through bringing 

in other additional climate change monies or other revenues to help 

move this forward. We also believe that by tailoring the Federal financial contribution to the Federal risk, we could also unlock really 

a tremendous amount of local and private investment that actually 

would like to happen in transit. 
17 

But right now, you are actually penalized from bringing in more 

private or local revenue. There are a number of projects, for instance, where they have wanted to do a tunneling project or they 

wanted to do stationary improvements. Of course, that adds to the 

cost and they actually have local money or private entities who are 

willing to pay for that cost, but right now, you are penalized for 

anything that adds any cost to a project. And so both increasing 

the Federal New Starts funding levels, which we think could help 

get through the pipeline, but also really opening up to leverage the 

tremendous interest that is out there by the private sector right 

now. 

Chairman MENENDEZ. Great. One last question. Mr. Sarles, the 

agency, New Jersey Transit, is among others that has delivered, in 

your case, four New Starts projects. So it is a mature agency, and 

there are others, as well, that have succeeded in this regard. 

Should such agencies with a proven track record be able to forego 

the step of proving they are capable of delivering a New Starts 

project on time and on budget? If there is a case to be made for 

that—I am not advocating it, I am not sure whether that is—but 

it seems to me that if you have a historical pattern of engaging, 

succeeding, and meeting or in some cases being on time or early 

and under budget, that why do we have to go through the whole 

process in that particular context of the process. Would that help 

reduce project delivery time and costs and free FTA’s time to assist 

other projects that are new to the process? 

Mr. SARLES. A most emphatic yes to that. 

Chairman MENENDEZ. Could you use the microphone, for this 

gentleman down here? I heard you, but—— 

Mr. SARLES. I will get trained yet. A most emphatic yes. FTA 

should focus on where the risk areas are, and if we have in our 

case demonstrated time after time that we can deliver significant 

projects within the criteria, and we have already proven it, then we 

don’t have to make reams of paper submittals to prove that we 

have the competence to do it. 

Chairman MENENDEZ. Any other thoughts on that? 

Mr. THOMAS. I certainly agree, and I can appreciate both sides. 

As we went through this last and most recent FFGA process, we 

had gone through a couple of FFGAs prior to that, both at the very 

least on schedule and on budget. And as I said, the 2000–2001 

version was ahead of schedule and under budget, and right now, 

we are in that same process where we are ahead of schedule and 

under budget again. So I think that that track record certainly 

ought to count for something, because those processes transcend 

the people in the organization, basically showing that you have got 

the processes in place that allow that to happen, that force that to 

happen, that put the controls there to encourage those kinds of performances. So those things transcend the people, yes, sir. 

Chairman MENENDEZ. Yes, Ms. Zimmerman? 

Ms. ZIMMERMAN. I would add a slight addendum to that, however, in that I think what we have seen in our research is because 

particularly the cost effective index model and other things are so 

complex they require a tremendous amount of technical capacity. 

We are seeing most of the recent New Start projects that have received FFGAs are sponsored by larger agencies with more technical 
18 

capacity, and that have been through the ratings process before. So 

while I think we should be recognizing that, I think we also need 

to be aware there are a lot of new communities and medium-sized 

communities that are wanting to invest in transit, and right now, 

the current process is very hard for them, not having that capacity 

to do it. 

The Small Starts program, which was supposed to be a streamlined process, you know, we still don’t have the guidance that actually has a streamlined process. FTA came up with a very Small 

Starts process, but I think for those communities that are new to 

the process or smaller communities, I would say the current system 

really does unduly burden them in going through it. So I think it 

is balancing both those needs. 

Chairman MENENDEZ. Well, you can achieve both, though. 

Ms. ZIMMERMAN. Yes. 

Chairman MENENDEZ. You could achieve helping new entities be 

able to have a legitimate but fully vetted timeframe and having 

seasoned entities that have a proven track record not necessarily 

have to go through that element, right? 

Ms. ZIMMERMAN. 

[Nodding head.] 

Chairman MENENDEZ. I would be remiss after everything we 

went through in Congress in trying to get transit funding, how are 

you both doing in terms of deploying those funds, if you could give 

us a sense of it. 

Mr. SARLES. We received $424 million applying to 14 projects. 

Five of them are already underway. Jobs have been created and 

people are working. We have put shovels in the ground on a couple 

of new contracts already. We have others out to bid. We will have 

all the money obligated well within the timeframe. 

Mr. THOMAS. I am envious of Mr. Sarles, but certainly appreciative of the $62 million that we received. We applied that to the 

first phase of the Orange Line as well as some additional parking 

and radio communications systems. We have already received the 

first half of that $62 million, so it is putting quite a few people to 

work. 

We also received an advance on our Full Funding Grant Agreement, moving a 2014 payment up to this year, $78 million. And 

while we stress that is not new money, certainly the time value of 

money is new and that equates to $10 million. So it allows us to 

pursue additional projects, as I said earlier, as the region continues 

to ask, how can we get these other projects advanced? We have a 

2030 plan, Mr. Chairman, that people are already trying to figure 

out how we can advance projects by up to 15 years sooner in our 

financial plan, and so we are looking at every possible opportunity 

of project delivery as we go through that review, including the Buy 

America Bonds that are available now. 

We anticipate going to the bond market here in about a week 

and a half for about $1 billion of bonds, $750 million in Buy America Bonds and $250 million in the tax-exempt bonds. It is going to 

benefit our financial plan tremendously. We do a 20-year financial 

plan that identifies what we can spend and when we can spend it. 

But we have estimated—we have actually budgeted a 5.25 percent 

interest rate on that bond issuance, and if we were to do it last 
19 

week, the combined rate based on that issuance would be somewhere in the neighborhood of 4.3 percent, which all those things 

combined put us in a much better situation, certainly as we look 

at what the economy is doing throughout the country. It puts us 

in a good situation. 

Chairman MENENDEZ. So the aggressive timeframes that the 

Congress put in there are being met by both of you? 

Mr. THOMAS. Yes, sir. 

Mr. SARLES. 

[Nodding head.] 

Chairman MENENDEZ. Thank you very much. 

Let me thank all the witnesses for their testimony, seeing no 

other colleagues here at this point. Your entire, as I said, written 

statements will be entered into the record and the record will remain open for 1 week for Members’ questions, for their statements 

and other supporting documents. If, in fact, you do get questions 

from the Committee, we urge you to be as responsive as quickly as 

possible to them and we appreciate your collective appearance. 

With that, the Subcommittee is adjourned. 

[Whereupon, at 3 p.m., the hearing was adjourned.] 

[Prepared statements and responses to written questions supplied for the record follow:] 
20 

PREPARED STATEMENT OF A. NICOLE CLOWERS 

ACTING DIRECTOR, 

PHYSICAL INFRASTRUCTURE ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE

JUNE 3, 2009 
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PREPARED STATEMENT OF GARY C. THOMAS 

PRESIDENT/EXECUTIVE DIRECTOR, DALLAS AREA RAPID TRANSIT (DART), AND

VICE CHAIR—RAIL TRANSIT, AMERICAN PUBLIC TRANSPORTATION ASSOCIATION

(APTA) 

JUNE 3, 2009 

Introduction 

Mr. Chairman and Members of the Subcommittee, on behalf of Dallas Area Rapid 

Transit (DART) and the American Public Transportation Association (APTA), we 

thank you for the opportunity to testify before you today and to submit our written 

testimony on the Federal Transit Administration’s (FTA) New Starts program. The 

New Starts program, which provides essential funding to cities like Dallas, Salt 

Lake City, Charlotte, Phoenix, and Portland who seek to improve mobility and air 

quality by establishing new transit services needs a ‘‘fresh start.’’ Changes must be 

made to the program that will help streamline the Federal transit program, reduce 

administrative burdens on transit agencies and help speed project delivery. 

About APTA 

APTA is a nonprofit international association of nearly 1,500 public and private 

member organizations. This includes transit systems and high-speed, intercity and 

commuter rail operators; planning, design, construction, and finance firms; product 

and service providers; academic institutions; transit associations and State departments of transportation. APTA members serve the public interest by providing safe, 

efficient, and economical transit services and products. More than 90 percent of the 

people using public transportation in the United States and Canada are served by 

APTA member systems. I have the pleasure of serving as the Vice Chair—Rail 

Transit of this great organization. 

About DART 

Dallas Area Rapid Transit (DART) provides direct access throughout Dallas and 

12 surrounding cities with modern public transit services and customer facilities tailored to make each trip fast, comfortable and affordable. Our extensive network of 

bus and rail services moves more than 220,000 passengers per day across our 700- 

square-mile service area. 

To promote ridesharing, we also operate a system of high occupancy vehicle 

(HOV) lanes allowing carpoolers to bypass freeway traffic jams. More than 145,000 

commuters use our HOV lanes each weekday. 

Through 2013, the DART Rail System is slated to double in size to 90 miles. With 

$700 Million in assistance from the New Starts program, DART is currently constructing the Green Line from Southeast Dallas to the northwest through downtown 

Dallas, past the American Airlines Center, the Dallas Medical/Market Center, and 

Love Field Airport, to the cities of Farmers Branch and Carrollton. At 28 miles, this 

is the longest light rail construction project underway in North America. Revenue 

service on this corridor will begin September 14 of this year. We will add light rail 

service to Rowlett, Irving and DFW International Airport between 2011 and 2013. 

A second alignment in the Dallas central business district will begin in 2016. 

Current State of the New Starts Program 

I thank the Subcommittee for allowing me to share our views on the New Starts 

program as you begin efforts to write the transit title of the next surface transportation bill. As this Subcommittee is well aware, we face extraordinary challenges as 

we look for ways to finance our transportation needs. The mass transit account of 

the Federal Highway Trust Fund is on a path to insolvency. While the transit account is in less immediate danger than the larger highway account, the balances 

in both are falling at a rate that will undermine their ability to support current obligation levels. We support maintaining the current basic Federal transit funding 

structure: a separate Mass Transit Account (MTA) within the Highway Trust Fund, 

crediting the MTA with at least 20 percent of motor fuel taxes, and preserving the 

current 20 percent General Fund contribution to the transit program. 

Even with that funding structure in place, the New Starts program needs a fresh 

start. Changes must be made to the program that will help streamline the Federal 

transit program, reduce administrative burdens on transit agencies and help speed 

project delivery. Many of the agencies receiving these funds are in fast-growing regions. These agencies have to be creative, resourceful, and nimble to respond to increased congestion and decreased mobility. In our area of North Texas, for example, 

we are again this year the fastest growing region in the United States. Over the 

past decade we have added a million new residents—a trend that is continuing. This 
40 

year commuters in our region will spend 60 hours stuck in traffic. We simply must 

build more transit infrastructure, and we must do so today. 

With the assistance of both the FTA headquarters and regional office staff, DART 

successfully navigated the New Starts program for the Green Line receiving just 

under 50 percent of the Federal project cost. The New Starts program provided 

DART with an additional funding source that allowed for the use of local dollars 

on other expansion projects, benefiting our customers and sustaining our capital expansion program. 

As reported in the ‘‘New Starts Program Assessment’’ prepared by Deloitte Consulting in 2006 for FTA, the New Starts program submittal requirements or guidance changed several times during the development of the Green Line project. This 

led to $100 million dollars in additional finance charges and escalation costs as a 

result of continuing review, as well as 6–8 months of delay by FTA to review the 

regional travel demand model and user benefit calculation that did not significantly 

alter our findings. Nevertheless, the New Starts program is a valuable funding 

mechanism and should be continued, but with modifications. 

We began development of the Green Line in 1998 and received our Full Funding 

Grant Agreement (FFGA) in July 2006. We made our first New Starts submittal in 

2000 and made a subsequent submittal each year thereafter. We completed alternatives analysis in 13 months, preliminary engineering in 48 months and final design in 12 months. The additional time for preliminary engineering was directly related to resolving the alignment issue adjacent to Love Field Airport. All local parties wanted a direct connection via a tunnel and had identified the financial resources to pay for most of the cost that could have made for a better project. However, the additional capital cost had a substantial impact on our user benefit calculation that would have resulted in a ‘‘Not Recommended’’ rating. We strongly suggest that the cost calculation should only consider the Federal project cost—local 

sponsors should be able to add project features at their own expense without harming their cost-effectiveness rating. 

The role that the FTA regional office plays in the New Starts process needs to 

be better defined and strengthened. It is through these staff that transit properties 

work on a daily basis and who have a greater understanding of the local issues and 

the purpose and need of a project. The regional staff has traveled the local corridors 

and has been stuck in the same congestion problems we are trying to explain to 

Washington. Regional staff members have ridden DART and understand the need 

for change and the value of the improvement. During the Green Line project, DART 

requested headquarters staff to come visit Dallas and see what we were describing 

and experiencing, but they were unable to do so. The local staff, who had seen the 

DART project first hand had to defer to headquarters because that’s where the reviews took place. It is cases like this one that point out the need for the regional 

office to have a stronger role in project review. 

Recommendations for Improving the Programs Application and Evaluation 

Process 

The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for 

Users (SAFETEA–LU) expires at the end of the current fiscal year. 

As Congress considers a new authorization bill, APTA has developed a set of recommendations that calls for a significant increase in Federal transit investment and 

improvements within the New Starts program. 

Both DART and APTA urge Congress to provide FTA no less than $12.4 billion 

to fund public transportation programs, representing the first year’s installment of 

public transportation investment. This level is consistent with APTA’s recommendations for FY2010 under the next surface transportation authorization bill. APTA 

also recommends a significant increase in Federal public transportation investment, 

with no less than $123 billion provided over the six-year period. 

In addition to seeking an increase in funds, we recommend several key changes 

to the New Starts program structure. These changes will help streamline the Federal transit program, reduce administrative burdens on transit agencies and help 

speed project delivery. These include: 

• We encourage a simplified and streamlined review, rating and approval process 

for all New Starts projects. Projects are currently strangled in red tape, which 

unnecessarily delays project construction and increases project costs. 

• Strengthen the role and involvement of the FTA regional office in the New 

Starts process including both reviews and determinations. The local office has 

a clearer perspective of local issues and how the transit improvements will benefit that specific community. 
41 

• Re-establishment of an exempt category of New Starts projects that require 

small amounts of funding. 

• We support major reforms to the New Starts rating standard. The current 

standard, as implemented by FTA, does not adequately take into account the 

full range of benefits due to New Starts projects, especially land use, economic 

development and environmental benefits. In addition, the cost calculation 

should only consider the Federal project cost—local sponsors should be able to 

add project features at their own expense without harming their cost-effectiveness rating. 

• Re-establish the Program of Interrelated Projects provision of the Intermodal 

Surface Transportation Efficiency Act (ISTEA). Local sponsors should be able 

to advance multiple projects simultaneously in such a program in order to reduce costs. 

• Greater use of Pilot and Demonstration projects to acknowledge the fact that 

not all projects fit the requirements of the New Start programs. Our Central 

Business District Transit Study (D2) is an example. We need to provide for additional capacity in the core area, but do not currently meet the requirements 

of a New Start. We would like to work with FTA to develop and implement a 

Demonstration Project to develop new criteria for nontypical projects. 

• There should be an opportunity to explore new ways to be flexible and responsive to changing conditions such as increasing fuel costs. As you know, transit 

agencies around the Nation were challenged to respond to the dramatic ridership increases due to rising fuel prices. Perhaps a pool of emergency operating 

funds could be made available to support agencies as they deliver more service 

in response to an immediate need without extensive time lost in processing. 

Summary 

We face both remarkable opportunities and serious challenges in the days ahead. 

President Obama recognizes the central importance of our transit systems to our 

quality of life and the quality of our environment. He has spoken of the need to invest adequately and to invest efficiently. The President has stressed repeatedly the 

role that public transportation must play in reducing pollution, including greenhouse gas emissions, and moving towards energy independence by diminishing our 

reliance on foreign oil. 

We look forward to working with the Subcommittee to make the necessary 

changes and investments to grow the public transportation program. We urge the 

Subcommittee to invest in public transit by authorizing the funds necessary to sustain the growing interest and value that public transit provides in communities 

across the country through the New Starts program. Finally, we support the efforts 

of Congress thus far to invest in a sustainable high-speed rail system and encourage 

your Subcommittee to continue building upon the foundation established in the 

American Recovery and Reinvestment Act of 2009. It is an exciting time for public 

transportation and a critical time for our Nation to continue to invest in transit infrastructure that promotes economic growth, energy independence, and a better way 

of life for all Americans. 

Mr. Chairman, this concludes my presentation to the Subcommittee. I will be 

happy to answer any questions you have. Again, thank you for the opportunity to 

testify before you today. 

PREPARED STATEMENT OF RICHARD SARLES 

EXECUTIVE DIRECTOR, 

NEW JERSEY TRANSIT

JUNE 3, 2009 

Chairman Menendez, Ranking Member Vitter and distinguished Members of the 

Subcommittee—my name is Richard Sarles and I am the Executive Director of NJ 

TRANSIT. NJ TRANSIT is the Nation’s largest statewide public transportation system providing nearly 900,000 weekday trips on 2000 buses, 3 light rail lines, and 

11 commuter rail lines. 

Congress and the Obama Administration—through the American Recovery and 

Reinvestment Act (ARRA)—have sent a strong signal to the American public that 

improving and expanding public transportation is a priority. 

It is precisely because we stand at the gateway of a new era in transit investment 

that it is critical to ensure that, going forward, we have the most expeditious and 
42 

transparent process to deliver critically needed projects both at the agency and Federal levels. 

First, let me say that we are very, very pleased to be working with FTA Administrator Peter Rogoff. The Administrator is an extremely knowledgeable transportation expert with considerable experience with New Starts through his work on the 

Senate Appropriations Committee. He has been a friend to transit for many years 

and has already hit the ground running, working with us closely in New Jersey to 

advance New Starts projects. I look forward to his leadership and partnership at 

FTA. 

The FTA has an important, welcomed oversight role in the New Starts process 

that was designed to realize the benefits for money expended, and to ensure both 

the competitive nature of the program and the proper usage of Federal funds. 

What I hope to address today is the fact that the FTA, like NJ TRANSIT, has 

limited resources to devote to these valuable oversight responsibilities. FTA must 

focus its resources to assure that the costs and benefits of a project are fairly presented and that a grantee has in place the requisite organization, funding, processes, controls and personnel to advance and sustain a project. The FTA does not 

have nor should have the expertise to plan, engineer and construct major projects. 

Nor should it request or demand reams of documentation with multiple revisions 

from clearly experienced agencies to prove they know how to plan, engineer, and 

construct a new starts project. 

While we have worked through the years on multiple New Starts projects that 

have yielded tremendous benefits, our experience shows a more recent trend towards layers of oversight that can create risks to project schedules and budgets. 

Specifically, NJ TRANSIT has completed four New Starts projects since the program’s inception, including the Frank R. Lautenberg transfer station, the Hudson– 

Bergen Light Rail Segments 1 and 2, and the Newark Light Rail extension project. 

NJ TRANSIT also completed the Riverline Light Rail project with State funds only. 

The total value of these projects was $3.9 billion. 

Let me share NJ TRANSIT’s experience with the New Starts process on two 

major projects—one in operation, and one about to break ground this month. 

The first, the Hudson–Bergen Light Rail (HBLR) project, which is operational 

today, offers frequent and convenient service through seven cities along the Hudson 

River waterfront. 

And it is important to note that during the project’s early stages, that then-Mayor 

Menendez of Union City was not only an advocate of the project, but convinced NJ 

TRANSIT to add a station in Union City—which now has over 5,000 daily riders. 

HBLR has been a huge driver for economic development in Hudson County, in fact, 

in a region where cities are shrinking; Jersey City in the last quarter-century has 

gained about 30,000 residents, 27,000 jobs and 18 million square feet of prime office 

space. 

NJ TRANSIT’s experience with FTA in securing Full Funding Grant Agreements 

for the HBLR in the late 1990s was fairly straightforward. 

NJ TRANSIT, in partnership with the Port Authority of New York and New Jersey, is also in Final Design and will soon break ground on the Access to the Region’s 

Core (ARC) project—the first new rail tunnel to be built under the Hudson River 

in 100 years. This $8.7 billion project will generate some $45 billion in new regional 

economic activity while providing riders with more frequent, direct and reliable 

service. The Tunnel will accommodate a 50 percent increase in the number of daily 

passenger trips beneath the river, taking 22,000 cars a day off area highways and 

reducing greenhouse gases and other pollution by more than 66,000 tons per year. 

The New Starts process in 2005, when we began submitting information for ARC, 

had changed substantially from the days of the HBLR. Some changes were positive. 

For instance, FTA required a fleet management plan for all transit modes operated 

by NJT, a financial plan, a 2030 rail operating plan, and a land use and economic 

development analysis. The process enforces a discipline on the logic used to develop 

and analyze a plan, which is useful so that comparisons can be made between different proposed transit projects and also so that the proposing agencies have the resources and skills they need to implement the project. I welcome the discipline. 

However, in an environment where investments need to be accelerated to boost 

the economy and protect the environment, review timetables need to be balanced 

against the need to progress through the process with a focus on completion. 

For example, the current New Starts process has evolved to include many more 

layers of review, and re-review which are sometimes onerous and can unnecessarily 

slow an agency’s ability to advance on a reasonable schedule. Even modest changes 

to a project now result in more process—in fact, I can say with some certainty that 

if a Mayor requested an additional station for a New Starts project today—a request 
43 

that would improve the project through increased ridership and economic development—the result would be project delay and cost increases. 

With these experiences in mind, I recommend the Committee consider the following steps with respect to reforming the New Starts process. In order to meet the 

Administration’s objectives while providing appropriate oversight, the program 

should embody five fundamental principles: 

1. Establish a true partnership between the Federal Government and State and 

local governments seeking to improve public transit bound together by mutual 

respect rather than red tape. 

2. Streamline the New Starts process so that predictability of the process is a priority. One way to accomplish this is to make it more of a ‘‘procurement’’ type 

process. 

3. Realign the review process to account for the experience of more established 

transit agencies. 

4. Acknowledge the fact that the FTA has become the minority funding partner 

and further recognize that a Full Funding Grant Agreement limits the exposure of the FTA to fund more than a specified amount of the proposed project’s 

total cost. At the same time the local agencies bear the risk of cost increases, 

including those due to delay in decision making. 

5. Encourage the expansion of public transit consistent with concerns about production of green house gases and energy consumption. The weight given to 

evaluation criteria categories should be revisited. 

True Partnership 

Transit agencies need to renew partnerships with FTA that are bound together 

by mutual respect and trust, not one bound together by red tape. Over the years, 

additional requirements, many to do with the level of detail for reporting information and how different sets of analytic results need to link together, have been 

added to the New Starts process. The FTA should be aggressive in reviving the spirit of partnership that should exist between transit agencies and the Federal Government and permit more flexibility in project development. 

Streamlined Process 

One option worth considering is streamlining New Starts into more of a ‘‘procurement’’ type process. Rather than continuous reviews of projects, reorganize the new 

starts process as though FTA is ‘‘procuring’’ transit expansion projects. All proposals 

would be due on a specific date each year and would be evaluated in a process similar to evaluating a design build proposal—a value based proposal. Projects would 

be scored and the value put against their respective costs. After reviewing proposals 

from various transit agencies, FTA would execute FFGAs for the best projects that 

year. 

Again, many components of the New Starts process are helpful and necessary— 

what is needed is predictability. I can’t emphasize this enough—the timetable for 

the New Starts process, including receiving approvals, should be known and certain. 

Today the length of time to go through the process is difficult to predict, so the 

projects become even more difficult to schedule. In the early 1980s, New York City 

made similar improvements to its land use review process. Today there is a ‘‘clock’’ 

that moves project review from start to finish in a specified amount of time. 

Established and Experienced Public Transit Agencies 

While the FTA is seeking to employ a process it intends to be fair and complete, 

it should also acknowledge that there is less need to probe the management and 

operations of more established and experienced transit agencies that have demonstrated the ability to build and operate public transit systems and receive triennial reviews by the FTA. Staff and funding resources are too limited at all transit 

agencies and the FTA, to spend time on multiple, sometimes unnecessary reports. 

Federal Funding Participation 

Project reporting and oversight by the FTA should reflect its relative commitment 

of capital funding to the total project cost. Oversight responsibility should reflect the 

fact that a Full Funding Grant Agreement provides a cap on the Federal funding 

responsibility and the fact that the FTA is the minority funding contributor. 

Accounting for New Concerns 

Our Nation’s appropriate new focus on reducing green house gas emissions and 

the use of petroleum based fuels requires that the criteria used in deciding which 

projects should receive Federal funding should be changed. There is also a need to 

recognize the positive value of transit investment in stimulating economic develop-
44 

1 ‘‘Jumpstarting the Transit Space Race: How the New Administration Could Make America 

Energy-Independent, Create Jobs and Keep the Economy Strong.’’ Reconnecting America, 2008. 2 American Public Transportation Association, 2009. 

3 ‘‘Hidden in Plain Sight: Capturing the Demand for Housing Near Transit.’’ Reconnecting 

America, 2005. 

ment consistent with the aforementioned concerns. The strong emphasis now given 

to the Cost Effectiveness Index and how the mathematics behind the Index is organized should be revised to encourage construction of more transit lines as a means 

of achieving a reduction in green house gas emissions and energy use rather than 

limiting them. 

I deeply appreciate the Committee’s leadership on this matter. It is absolutely 

critical that if we are to achieve the ambitious agenda of building and expanding 

transit infrastructure across the country, we need to streamline the Federal process 

and work more urgently together as partners at the Federal, State, and local level. 

I am grateful for the opportunity to offer our thoughts today on how we can work 

together to build a better transportation network. 

I would be glad to take your questions. 

PREPARED STATEMENT OF MARIIA ZIMMERMAN 

POLICY DIRECTOR, 

RECONNECTING AMERICA

JUNE 3, 2009 

Chairman Menendez, Ranking Member Vitter, and distinguished Members of the 

Subcommittee, thank you for the opportunity to appear before you today. I am 

Mariia Zimmerman, Policy Director for Reconnecting America, a national nonprofit 

dedicated to using transit investments to spur a new wave of development that improves housing affordability and choice, revitalizes downtowns and urban and suburban neighborhoods, and creates lasting value for our communities. Reconnecting 

America is a cofounder of the Transportation for America campaign, and we also 

host the national Center for Transit-Oriented Development (CTOD), a partnership 

with two other groups: the Center for Neighborhood Technology and Strategic Economics. 

CTOD is federally funded to provide standards, guidance, and research on transitoriented development (TOD), including a web-based resource of best practices and 

cutting edge research, and the National TOD Database, the only database of every 

existing and planned fixed transit station in America. We provide technical assistance to the 40 regions that either have transit or are planning to build new transit 

lines. 

Today I would like to share with you some of the larger trends that are reshaping 

consumer preferences, business trends and the real estate market, creating an unprecedented opportunity for transit in defining the future sustainability of our communities. The way the Federal Transit Administration evaluates proposed transit 

investments has a direct bearing on whether or not regions are able to fully realize 

the potential of these trends. 

In a 2008 study by Reconnecting America, we found that the demand for transit 

is soaring across the country, with 400 new rail, streetcar and bus rapid transit 

projects proposed in almost 80 communities across the country at a proposed worth 

of $248 billion—far more than can be funded through the Federal transit program 

alone. 1 Transit ridership is at a 52-year high; since 1995, ridership has increased 

38 percent; nearly triple the rate of population growth. 2 There are a host of reasons 

for this boom in demand for transit. Mayors value transit in helping to spur urban 

regeneration and reduce traffic congestion. Businesses value transit because employees can get to work on time and transit is viewed as a key amenity in attracting 

the highly desirable ‘‘creative class’’ to local economies. Developers see an untapped 

market for housing near transit and are designing new products and new neighborhoods to meet this demand. And, communities recognize that when all the pieces 

come together, transit can be a powerful tool to improve quality of life and help 

lower costs of living. 

CTOD has estimated the demand for housing near transit to increase to almost 

15 million U.S. households by the year 2030, roughly a quarter of all renters and 

buyers, and a more than doubling of demand from the 6 million households that live 

near transit today. 3 This is a tremendous potential increase. If we are to come even 

close to achieving it, we need more transit investment and we need to reduce regu-
45 

4 ‘‘Planning for the Future: New Starts Projects Must Address Next Generation of Transit 

Projects.’’ APTA, October 2006. 

latory barriers that still make mixed-use, more compact development illegal in many 

communities. In addition, we need to maximize opportunities to leverage public resources and reduce the funding and bureaucratic silos between housing, transportation, and economic development. 

Regions are aggressively seeking to use transit investments to help focus growth, 

create a sustainable foundation for economic development and provide mobility options for residents. Take into consideration Denver. In 2004, residents of the region 

voted to tax themselves to build five new transit lines in 15 years. They’re making 

a $6.4 billion investment in their future and focusing a significant percentage of regional growth into neighborhoods around each station. Virtually every major job 

center will now be connected by transit and the remaining 50 stations will accept 

about a quarter of the region’s housing. In Orlando, the Central Florida commuter 

line will not only provide much needed congestion relief, but will provide the impetus for community revitalization in those towns with transit stops. The proposed 

Gold Line in Los Angeles is seen as a central strategy to curb sprawl in the Inland 

Empire and focus growth around the Claremont Colleges and a thriving medical 

complex. We’re seeing similar investments in the Twin Cities, Houston, Dallas-Fort 

Worth, Salt Lake City, Atlanta, Sacramento, Norfolk and Charlotte, North Carolina—regions that even a few years ago wouldn’t immediately come to mind as transit-based places. 

Given the tremendous demand for new transit service, many communities are 

seeking new ways to fund and expedite project development. Federal funding for 

new transit lines has remained relatively stable, between $1.5 billion and $1.9 billion annually, while the time to successfully navigate the Federal New Starts process has increased from 5 years in 1991 to 10 years in 2004. 4 To cite one example, 

both the Seattle, Washington, streetcar, which did not go through the New Starts 

process and Charlotte, North Carolina, South Corridor light rail line, which did, 

opened at the end of 2007. But the Seattle streetcar was proposed 5 years after the 

Charlotte project. 

The relatively low level of transit investment in the United States stands in stark 

contrast to funding in other parts of the world. China, for example is dedicating $88 

billion for construction of 1,062 miles of rail over the next 6 years. India has announced it will spend $56 billion to expand its rail system over the next 5 years. 

In London, the United Kingdom is spending $32 billion on just one subway project— 

the 74-mile Crossrail subway in London. 

It is clear from the growing domestic demand for transit, and the need to address 

our global competitiveness and reduce our dependence on foreign oil that more transit investment is warranted. My organization joins a growing chorus of voices that 

asks Congress to significantly increase funding for public transportation in the next 

surface transportation reauthorization, and as part of overall energy and climate 

legislation that may also be before the Senate this Congress. 

Increased investment in public transportation should be viewed as part of a larger 

national goal to build and maintain a national transportation system that includes 

a well connected and integrated highway, transit, and rail network. Last month, 

Senators Rockefeller and Lautenberg introduced S. 1036, ‘‘The Federal Transportation Policy and Planning Act of 2009.’’ This legislation sets a bold new vision for 

Federal transportation policy in order to address the current and future needs of 

our economy, energy, environment and health. The measure establishes a unifying 

mission for the Federal surface transportation program and sets needed and achievable performance targets, including goals to increase system safety, to repair and 

maintain existing assets, and to reduce congestion and carbon emissions through increased use of transit, rail, marine, and nonmotorized transportation. The Transportation for America campaign supports this legislation and hopes that these performance targets will be effectively integrated into the Federal transportation planning 

process as part of the next transportation bill. 

As Congress works to reform Federal transportation policy, it will be important 

to ensure that it benefits those communities that have been historically disadvantaged by how our Nation has chosen to invest. This Subcommittee may wish to see 

included performance targets which speak to the critical need to better coordinate 

transportation with housing, land use and social equity goals—all objectives which 

fall within your Subcommittee’s jurisdiction. Towards this aim, T4America recommends the following additional national transportation performance targets: 

• Achieve zero percentage population exposure to at risk levels of air pollution; 
46 

5 ‘‘Destinations Matter: Building Transit Success.’’ Reconnecting America, May 2009. 

• Reduce average household combined housing + transportation costs 25 percent; 

and, 

• Increase by 50 percent essential destinations accessible within 30 minutes by 

public transit, or 15-minute walk for low-income, senior, and disabled populations. 

In addition to providing more Federal resources for transit and clearly articulate 

a set of national transportation objectives, the Federal partnership can also be improved through major reform of the Federal New Starts process. I commend the 

Subcommittee for beginning to address this important issue through today’s hearing. There appears to be general agreement that the current program has lost its 

way and become overburdened by existing statutory and regulatory requirements. 

My organization supports a rigorous review process to ensure that Federal investments are being wisely made and to ensure transparency and oversight. However, 

the unlevel playing field between the current process for planning, designing, and 

constructing a new transit project versus a new highway project severely handicaps 

transit projects from moving forward and unduly burden transit projects with increased project costs. 

We recognize the challenge the administration has in developing a fair and rigorous review process. We are encouraged by some of the proposed changes in the 

May 2009 Proposed Guidance on New Starts/Small Starts Policies and Procedures, 

particularly reinstating a multi-measure evaluation rating system. I’d like to use my 

testimony to highlight two measures particularly important to my organization: land 

use and economic development. 

There is a growing concern among local project proponents, whether real or perceived, that including a full range of amenities, streetscape improvements, and pedestrian safety enhancements in a proposed transit project will jeopardize Federal 

funding. Yet these are the very features that help maximize walking trips to transit 

and create high value urbanism. Local concern over meeting the Federal Cost Effectiveness Index has lead some communities to shortchange the number of transit stations, rail cars, or corridor enhancements that would help meet or even exceed 20- 

year ridership projections. 

Our research shows that actual ridership on many recently built transit lines is 

higher than predicted by the FTA’s Transit System User Benefit or ‘‘TSUB’’ model. 5

This raises significant concerns about the substantial weight placed on these model 

results, and we believe validates the need to maintain a multi-measure approach 

to evaluating projects, including qualitative and quantitative measures. 

The overall data show that the majority of recent rail lines built with Federal 

funding through the New Starts program are performing at least as well as pre-construction projections. Some lines, such as Minnesota’s Hiawatha Light Rail and the 

Metro Red Line in Houston are outperforming their ridership estimates 15 years 

ahead of projections. It is interesting to note that some of these lines would not have 

been funded if rated solely on their Cost-Effectiveness rating. For example, the Hiawatha Line received only a low-medium Cost Effectiveness rating. This presents 

both good and bad news. 

The good news is that over performing lines give transit agencies and communities the momentum and political capital to expand their transit systems to benefit 

more of the region. The bad news is that these over performing lines indicate that 

cost reductions in the planning stage are resulting in a shortage of transit vehicles, 

parking spaces, inadequate tracking or maintenance facilities or may have contributed to a downgrading of technology. 

Reconnecting America continues to support changes made in SAFETEA to raise 

the significance of land use, and to add economic development to the list of project 

justification criteria. These are not insignificant changes. They recognize what we 

know about the potential power of transit investments to generate a host of benefits, 

beyond cost and travel time savings. 

Such an approach is similar to that taken by Canada and the United Kingdom 

in allocating their national transportation funding. Those two countries give much 

stronger consideration in their analysis to a full range of benefits including environmental impacts, specifically the reduction of greenhouse gas emissions, and for Canada, consideration of economic development benefits as measured by public/private 

rates of return. I find it curious that other countries, and indeed American developers, companies and even local economic development agencies can separate and 

evaluate land use and economic development, yet our Federal Government continues 

to find this a challenge. 
47 

6 ‘‘Preserving Opportunities: Saving Affordable Homes Near Transit.’’ National Housing Trust 

and Reconnecting America, 2007. 7 ‘‘Preserving and Promoting Diverse Transit-Oriented Neighborhoods.’’ Center for TransitOriented Development for the Ford Foundation, 2006. 8 ‘‘The Affordability Index: A New Tool for Measuring the True Affordability of Housing 

Choice.’’ Center for Transit-Oriented Development and the Center for Neighborhood Technology 

for the Brookings Institution’s Urban Markets Initiative, 2006. 

Strictly defined from a traditional economist’s perspective, economic development 

is the measure of productivity derived from a specific investment—a difficult and 

abstract concept. The practitioners’ definition for economic development encompass 

the much easier to measure realm of real estate development, employment gains, 

access to jobs, concentration of economic activity and return-on-investment. This approach can include the capitalization of user benefits (e.g., users expending less on 

transportation costs and travel time which can be spent on other goods and services), redistributive economic development benefits represented through revenue 

generation from increased property values and ridership, and the benefits of agglomeration, or the potential for increased business transactions due to densification 

and proximity of uses. There are a number of proxies that could be used to evaluate 

potential economic development impacts of transit investments, ranging from housing, employment and population projections to developer agreements, local financial 

contributions to the corridor and targeted public finance tools such as Business Improvement Districts and tax increment financing. In short, we believe that there are 

a number of commonly used indicators of economic development that could be incorporated into the transit project evaluation process. 

We do not agree with the argument that economic development and land use are 

too difficult to measure separately, but we do feel that given the confusion over 

these terms it may be useful to better define each in the next transportation bill 

or to develop a fresh New Starts process that incorporates more of a ‘‘warrants’’ approach in the evaluation process to help to expedite project delivery. The basic concept is that a set of corridor and project characteristics and conditions (referred to 

as warrants) would be established. These could include factors related to employment and population density, or threshold ridership levels, for example. FTA would 

determine that projects meeting these pre-defined warrants have met the statutory 

criteria and would be advanced into New Starts or Small Starts project development, and could be recommended for funding. 

Additional suggestions to improve the project delivery process for New Starts that 

warrant more consideration by Congress include: 

• Development of a metropolitan mobility program that could allocate formula 

funding for small start capital transit investments, thereby avoiding the Federal 

review process but still ensuring these projects are evaluated through existing 

Federal environmental and planning requirements. 

• Advancement of a set of interrelated expansion projects, similar to the approach 

taken by Salt Lake City, Utah, and Houston, Texas. 

• Reconciliation of the major capital investment alternatives analysis with the Alternatives Analysis requirement in NEPA, to create one integrated comprehensive analysis instead of a time-consuming and confusing two-step process. 

I’d also like to highlight some of the social equity needs of transit-supportive land 

use policies. Over the past 5 years, CTOD has worked with the Federal Transit Administration, HUD, AARP, and affordable housing advocates on a series of reports 

highlighting the importance of transit to racially and economically diverse neighborhoods. Neighborhoods within a half-mile of a fixed transit station are home to a 

greater share of a region’s lower-income households, and also contain a high number 

of federally assisted housing stock. 6 The data also shows that in three-quarters of 

these ‘‘transit zones’’—defined as the half-mile radius around stations—households 

have one car or no cars. 7 This low-rate of auto ownership indicates that residents 

do realize the cost-savings that comes from lower auto ownership. Our work, sponsored by the Brooking Institution, found that while the average American family 

spends roughly 19 percent of its household budget on transportation, households 

with good access to transit spend just 9 percent. 8

But as the demand increases and the market heats up for land and housing in 

these neighborhoods, the threat of displacement will force households to lose potential affordable transportation and affordable housing options if they are pushed out 

of transit accessible neighborhoods. The affordable housing opportunities that are 

lost cannot be regained without an enormous public expenditure. 

One way to ensure the market provides housing opportunities for families of all 

income levels is through well-designed policies that ensure that housing near public 
48 

transit is permanently affordable to families at a mix of incomes—both on the rental 

side and on the ownership side. The New Starts program and transportation reauthorization provide Congress an opportunity to encourage localities to make investments and adopt land use policies to support both proposed transit investments and 

address long-term affordability. Reconnecting America, together with the National 

Housing Conference, has convened a group of national housing and transportation 

organizations to help identify ways that our Federal housing and transportation programs could be better coordinated. 

We commend the recently announced HUD–DOT interagency sustainability partnership and look forward to working with both agencies to identify and implement 

strategies that make it easier for communities to successfully integrate housing and 

transportation investments. In regards to the New Starts process, we feel that more 

can be done to simultaneously improve project delivery and reward affordable housing preservation. One idea we are vetting is to allow communities to count investments in housing affordable to families with a mix of incomes within a half-mile 

of a proposed transit station as a match against requested Federal dollars. Another 

option may be to reward communities that implement mixed-income housing preservation and creation policies in the land use evaluation measure; thus moving beyond 

just reporting on the number of low-income households currently residing in a proposed corridor, to actually rewarding those communities that take steps to ensure 

long-term affordability to households at a mix of income levels. For example, a growing number of States including New Jersey, North Carolina, Illinois, and California 

already give higher credit in the allocation of State low-income housing tax credits 

to areas well served by transit. 

The Federal New Starts and Small Starts program sets the rules for engagement 

in how communities coordinate proposed transit investments with larger regional 

decisions about population growth and economic development. Our Nation is facing 

significant challenges to maintain our economic competitiveness, address energy security, meet the demands of projected population growth, and preserve our quality 

of life. Expanding the number of regions with high quality transit, and growing existing transit systems is critical to achieving these goals. 

Thank you very much for this opportunity to appear before the Committee today, 

and my organization looks forward to working with you on giving the New Starts 

and Small Starts program a fresh start in the next surface transportation bill. 
49 

RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ 

FROM A. NICOLE CLOWERS 

Q.1. Some have said that the FTA may be using the approval process to slow down some projects to fit the amount of commitment 

authority they have available. Do you think that is true? If so, 

should there be a mechanism for FTA to use so that it can 

prioritize projects rather than just slowing some down with red 

tape? 

A.1. According to FTA officials, the number of projects recommended for funding each year reflects the project’s readiness for 

a full funding grant agreement, not the amount of commitment authority available. Specifically, to be eligible for an FTA funding recommendation, proposed New Starts and Small Starts projects must 

complete the appropriate steps in the planning and project development process and, per SAFETEA–LU, receive an overall project 

rating of medium or higher. Furthermore, FTA officials told us that 

not all project delays can be attributed to FTA or the New Starts 

process. FTA officials cited a number of reasons that a project could 

be delayed during preliminary engineering or final design that are 

outside FTA’s control, such as changes to a project’s scope, changes 

in local political leadership, or the loss of local financial commitment. 

In contrast, many within the transit industry point to the New 

Starts process as being the cause for delays in project development, 

arguing that the process has become too time consuming, costly, 

and complex. To expedite project development within the New 

Starts program, industry stakeholders and consultants, and transportation experts we interviewed identified the following options. 

While each option could help expedite project development, each 

option has advantages and disadvantages to consider. In addition, 

each option would likely require certain trade-offs, namely reducing 

the level of rigor in the evaluation process in exchange for a more 

streamlined process. 

• Tailor the New Starts evaluation process to risks posed by the 

projects. FTA could adopt a more risk-based evaluation process 

for New Starts projects based on the project’s cost or complexity, the Federal share of the project’s costs, or the project 

sponsor’s New Start experience. By adopting a more risk-based 

approach, FTA could allow select projects to move more quickly 

through the New Starts process and more efficiently use its 

scarce resources. 

• Consider greater use of letters of intent and early systems 

work agreements. The linear, phased evaluation process of the 

New Starts program hampers project sponsors’ ability to utilize 

alternative project delivery methods, such as design-build, according to project sponsors. These alternative project delivery 

methods have the potential to develop a project cheaper and 

quicker than traditional project delivery methods can. However, project sponsors told us it is difficult to attract private 

sector interest early enough in the process to use alternative 

project delivery methods because there is no guarantee that 

the project will ultimately receive Federal funding through the 

New Starts program. To encourage the private sector involve-
50 

ment needed, project sponsors, consultants, and experts we 

interviewed suggested that FTA use letters of intent or early 

systems work agreements. 

• Consistently use road maps or similar project schedules. 

Project sponsors said that FTA should more consistently use 

road maps or similar tools to define the project sponsor’s and 

FTA’s expectations and responsibilities for moving the project 

forward. Without establishing these expectations, project sponsors have little information about how long it will take FTA to 

review its request to move from alternatives analysis to preliminary engineering, for example. This lack of information 

makes it difficult for the project sponsor to effectively manage 

the project. 

• Combine two or more project development phases. Project 

sponsors and consultants told us that waiting for FTA’s approval to enter preliminary engineering, final design, and construction can cause delays. While FTA determines whether a 

project can advance to the next project development phase, 

work on the project essentially stops. To reduce the ‘‘start/stop’’ 

phenomena project sponsors described, FTA could seek a legislative change to combine two or more of the statutorily required project development phases. 

• Apply changes only to future projects: Project sponsors told us 

that the frequent changes to the New Starts program can result in additional costs and delays as project sponsors are required to redo analyses to reflect the changes. To avoid this rework, some project sponsors, consultants, and experts we interviewed suggested that FTA apply changes only to future 

projects, not projects currently in preliminary engineering. 

RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ 

FROM GARY C. THOMAS 

Q.1. How do you envision a program to help transit agencies create 

additional core capacity in their city centers? Do we alter New 

Starts criteria or do we create a new program? If possible I would 

appreciate hearing specific suggestions on how the next bill could 

address this urgent need. 

A.1. A core capacity constraint is defined as a limitation on transit 

system capacity that prevents service expansion, without significant capital investment, to meet growing ridership demand. Ridership has or can be expected to exceed the system’s design capacity. 

In many of the largest urban regions in the Nation, transit plays 

a key role in the regional transportation system and ‘‘transit bottlenecks’’ have the potential to contribute to travel delays and decreased mobility. The issue is most pronounced on commuter rail, 

heavy rail and light rail systems in large metropolitan areas that 

have faced rapid increases in ridership over a number of years. As 

transit ridership continues to rebound, a number of the Nation’s 

largest cities like New York, Chicago, Washington, DC, and Dallas 

are facing this issue and may need to make significant capital investments. The demographics of increasing urbanization and limited options for roadway expansion means that the issue of core ca-
51 

pacity is likely to become more significant and affect an increasing 

number of urban systems. The issue has potential regional and 

even national significance for the Nation’s transportation system. 

Some of the most important considerations in developing a national 

approach to the issue include: 

• The lack of an industry definition for a transit bottleneck does 

not readily allow for an assessment of the national need for 

capital investments to address current bottlenecks—though a 

recent survey by APTA suggests the identified need approaches 

$25 billion; 

• Potential short-term effects of not addressing transit bottlenecks include an increase in transit operating cost, reduced reliability, and an inability to meet regional travel demand; 

• The negative effect of transit bottlenecks on transit service has 

the potential to shift travel from transit to the automobile in 

major urban centers and increase regional highway congestion, 

potentially reducing regional air quality; 

• Potential long-term effects include a dispersal of residential 

and job growth away from existing transit lines to areas not 

as readily served by transit; and 

• FTA’s current funding structure does not specifically target 

core capacity constraints with a designated funding source and 

large capital projects intended to address core capacity compete 

with an already highly competitive underfunded New Starts 

Program. 

Transit Bottlenecks at DART 

DART light rail ridership has increased significantly over the 

past several years. On average, more than 65,000 people a day are 

riding light rail during the week, compared with 63,000 riders during the same period last year. This increase in ridership is occurring while unemployment rates are up and regular gas is selling 

for about $2.40 on average as opposed to the $4 a gallon rate last 

summer. As a result of this increased ridership and anticipated future demands for service, DART is advancing a major construction 

program to double the size of the system to meet the anticipated 

additional demand. Without significant capital investment to expand the core capacity of the system, it is likely that DART will 

be unable to address growing demands. As ridership continues to 

grow, we will be operating near or in excess of our physical capacity. 

No single source of information exists that effectively frames the 

magnitude of the core capacity issue nationally. A more specific 

definition of a bottleneck or core capacity constraint is necessary 

for transit agencies to consistently identify these constraints and 

provide a national picture of need. Some agencies have identified 

specific projects that very likely fall into the definition. DART is 

conducting a Dallas Central Business District Transit Study to address the issues of regional transit capacity, service reliability, providing operational flexibility through downtown Dallas for all transit services, and improving access and circulation. A recent survey 

conducted by APTA estimated the cost of addressing existing core 

capacity issues at almost $25 billion, although the variation in cost 
52 

across agencies suggests that a consistent definition is not being 

applied. Continued increases in ridership—expected by a number of 

large urban transit systems—are likely to increase the number of 

systems facing core capacity constraints. 

How Can Bottlenecks Be Fixed? 

The relative challenge of solving bottlenecks varies. Bottlenecks 

might be addressed through minor capital improvements or relatively inexpensive operations strategies, or they can be very hard 

to resolve, such as where there are limits on the line-haul capacity 

of rail lines into the cores of major metropolitan areas such as New 

York or Washington, DC. Specific strategies to address transit bottlenecks will vary depending on the identified constraint. Specific 

‘‘point’’ improvements can be made, but the nature of the problem 

may require more systemic approaches—fixing one point may just 

transfer the problem to a different point on the same line. 

Potential strategies to address core capacity or ‘‘bottlenecks’’ include: 

• Changes in transit operations; 

• Managing peak demand through fare policies or other targeted 

efforts to spread the peak demand; 

• Upgrading existing equipment to allow for increased operations 

(e.g., switching or electrical); 

• Expanding capacity on existing lines (e.g., addition of a passing 

tracks or additional track); 

• Expansion of station facilities (e.g., platform expansion, station 

egress expansion); and 

• Construction of parallel facilities on a new alignment. 

Proposal: National Transit Bottleneck Mitigation and Core 

Capacity Program 

Core capacity constraints are currently addressed through a variety of funding sources through FTA, though no targeted program 

is in place and the source of funds varies. 

1. The New Starts program is the first option and the major 

funding source for the three New York MTA projects, East 

Side Access, the Second Avenue Subway, and the ARC. 

2. Rail modernization is an option for needed investments to upgrade existing rail systems that result in an enhanced system 

capacity. 

3. Formula funds are an option, though the total dollars available are limited. Finally, some flexible funds under the Federal Highway Administration programs may also be used for 

transit purposes, at the direction of the State, such as the 

Congestion Mitigation and Air Quality (CMAQ) in nonattainment areas and the Surface Transportation Program (STP). 

There are several options available to develop a more systematic, 

national approach to target core capacity constraints. The first is 

to use the existing New Starts Program with an expansion of funding and the second is to establish an independent program specifically targeted at core capacity on existing systems. 
53 

Expansion of the New Starts Program 

A number of existing projects in the New Starts Program, as discussed in this paper, are using the New Starts Program to fund 

projects that are attempting to relieve core capacity constraints. 

The current funding stream for New Starts does not provide sufficient funding for the multitude of projects that have been justified 

with less than $1.5 billion in funding proposed for the program in 

Fiscal Year 2007. The actual Federal share of funding for projects 

is now at 50 percent or less (even though the projects remain eligible for funding at the 80 percent level) and projects still face delays 

due to a lack of funding. By effectively rationing New Starts dollars 

with this lower Federal match, compared to the 80 percent Federal 

match for new capacity highway projects, the inadvertent result is 

that a transit investment may become less competitive in regional 

prioritization plans, particularly when leveraging of Federal funds 

is considered. 

The advantage to expanding the existing New Starts Program is 

that it has developed a detailed process to evaluate the user benefits of projects that can be applied to core capacity projects. However, there are two important issues to consider with the current 

process. First is the possibility that a core capacity project may not 

be deemed eligible under New Starts definitions, which require the 

inclusion of certain fixed guideway infrastructure elements. Second 

is how such projects might rate according to the established New 

Starts criteria measures. Because some core capacity projects are 

likely to involve upgrades to existing transit elements that improve 

operations and reliability but do not result in major changes to 

travel time—the key measure used by FTA to rate New Starts 

projects—the projects may not be deemed ‘‘meritorious.’’ 

A further disadvantage is the sheer magnitude of cost of these 

projects and the political implications of projects that benefit only 

a single metropolitan area. A single core capacity project, like the 

East Side Access project at $7.8. billion, with more than $2.6 billion 

proposed from the New Starts Program, is almost twice the annual 

funding for New Starts. This project would consume a large share 

of the New Starts Program funding and potentially delay a number 

of other projects across the country. This has political implications 

and sets up direct competition between large urban centers with 

older transit systems and many smaller to mid-size urban regions 

attempting to introduce rail into their regional transportation systems. Projects at the scale of those attempting to address core capacity issues often face funding delays and are under pressure to 

increase the share of local funding. In the case of East Side Access, 

Federal funding is proposed at just 34 percent of the project. 

Distinct Core Capacity Program 

An alternative, given the potential benefits of some of these investments, is consideration of a targeted program to address transit core capacity constraints. Similar to the New Starts Program, 

any targeted program should establish a mechanism to assess the 

relative value of projects based on specific criteria and user benefits. The program should provide the flexibility to fund a range of 

potential strategies. The challenge is to establish a new program, 

with sufficient funding, without taking away funding from existing 
54 

capital programs. If insufficient funding is provided to a targeted 

program, projects with significant funding requirements would likely face delays due to insufficient funding. Further, the targeting of 

funding to what may be a small number of existing systems may 

create equity issues for other urbanized areas that have adopted 

their own strategies and supplied their own funds to provide adequate transit capacity. 

Demonstration Project 

DART is proposing that the new Transportation Authorization 

Bill or under FTA’s research activities authorized by 49 USC 5312, 

Research, Development, Demonstration, and Deployment Projects 

include new demonstration projects that would look at the current 

capacity and ridership of a select number of transit systems to determine how close they are to capacity and project when they will 

reach capacity. The study would also look at the cost and effectiveness of various infrastructure investments (automated operation, 

additional vehicles, substations, energy storage technologies, track 

structure improvements, etc.) to increase capacity and how long it 

would take to put them into place. Ultimately, the study will provide sufficient information for the issue to be thoroughly addressed 

by the FTA and the Congress. 

RESPONSE TO WRITTEN QUESTIONS OF SENATOR MENENDEZ 

FROM MARIIA ZIMMERMAN 

Q.1. You indicated in your testimony that your organization has 

suggestions on how to institute an economic development measure 

for the New Starts program. Should the measure be qualitative 

such as zoning laws and land use planning, or should it be based 

on some sort of economic modeling? 

A.1. In our work on economic development impacts of transit investments, Reconnecting America has identified both a set of localized economic impacts being pursued by localities and regions as 

part of the reason behind their support for fixed-guideway investment. This includes not only the job creation in building a new 

transit line and in operating it, but the desired increase in property 

values, economic activity and long-term community benefits associated with the investment. These types of benefits are not well captured by current economic models that predict economic development. Such models tend to be used for evaluating regional economic development impacts associated with redistributive growth. 

Both have merit, but also trade-offs in terms of their ability to ensure that a project’s economic development benefits are evaluated 

in a reliable, predictable and easy to use process that ensures that 

they are distinguishable from other criteria. 

Reconnecting America has recommended to FTA that it pursue 

a mix of quantitative and qualitative measures of economic development. We recommend that FTA require project sponsors to provide benchmarks on a set of qualitative measures backed by quantitative data and applicable across project types to describe the anticipated economic development impacts and identify the commit-
55 

1The term corridor refers to the geographic area/alignment of the transit investment, be it 

a traditional light rail corridor, a fixed-guideway route for bus rapid transit (BRT), or a streetcar 

alignment. Similarly, the term stations includes both rail stations and fixed streetcar or BRT 

stops. 2For streetcar projects which typically include a larger number of stops in close proximity, 

this could be measured as the amount of housing and commercial space to be developed within 

half-mile buffer of the alignment. 3 Ibid. 

ment of public and private revenue towards development and infrastructure improvements within the transit corridor. 1

Potential metrics that could be implemented today include : 

A. Determination of the Economic Development Environment for 

the Proposed Project 

• Existence of development agreements and other private sector financial contributions towards proposed transit project 

or ancillary infrastructure improvements (i.e., sidewalk, 

sewer, station area improvements) and tied to focusing new 

development and/or serving existing development around the 

transit stations. 

• Existence and extent of Urban Renewal Districts, LIDs, 

BIDs and Tax Increment Financing with funding allocated to 

the transit corridor (not representative of new private revenue, but rather reflect a commitment of public revenue 

within transit corridor towards necessary infrastructure improvements that can generate further economic development). 

• Projections regarding affect of proposed project on the number or proportion of properties with an improvement-to-land 

value ratio of greater than one in the project area. 

• Describe the project’s proximity and relationship to: (1) other 

primary transit lines and/or facilities; (2) employment centers; (3) activity centers; (4) economic development zones; (5) 

central business districts, (6) other. 

• Existence and extent of TOD-supportive comprehensive plan 

amendments and transit overlay districts—this should be 

given greater weight in the Transit-Supportive Land Use review, not included as an economic development measure. 

B. Anticipated Economic Development Impacts of Proposed 

Project 

• Projections of new and existing housing and commercial 

space to be developed within half-mile radius of proposed 

station locations. 2

• Projections of population/household growth within half-mile 

of proposed station locations. 3

• Projection of new and existing employment and diversity of 

job types within one-mile buffer of the proposed corridor. 

• Projected tax receipts from increased values and economic 

activity occurring within the proposed corridor as a result of 

the transit investment. 

• Projected transportation efficiencies (e.g., cost per trip and 

estimated transportation cost savings to households within 

the corridor). 
56 

• Describe any past experience with similar existing projects 

that have had effects similar to those anticipated by the 

project and describe how past development experience within 

the proposed project area has differed from that of the existing projects. Use quantitative and qualitative descriptions, 

with documentation when available. 

Q.2. FTA says that it is difficult to distinguish environmental benefits of one project from another, but from what we hear from transit agencies they believe they have to buy the cheapest and most 

inefficient equipment available in order to keep the project with a 

good cost benefit rating. Is there a way to reward projects that attempt to maximize environmental benefits of their projects without 

jeopardizing the cost/benefit analysis process? 

A.2. There is currently no incentive in FTA’s cost-effectiveness 

index to acquire additional property, incorporate sustainable design 

in facilities or to add any additional costs to the project. If we want 

to shape land use and development, there needs to be land use policies and station area plans, but also some incentive to acquire 

property or engage in value capture to shape economic development. Data from the green buildings community has documented 

higher upfront costs for sustainable building design and materials, 

many of which are recaptured within several years. However, incorporating such design technologies is not encouraged under current policy. 

Finally, there are diminutive environmental benefits when comparing one transit project to another or even one transit project to 

the overall region. Moreover, the environmental impacts of the 

project over the forecast period are enhanced to the extent there is 

a greater emphasis on development since we have enough data on 

the relationship of transit and land use on reducing VMT. However, those benefits are reduced when measured at a project level 

as opposed to regionally until the system is built out. In order to 

address these challenges, the following policy changes may be warranted: 

• Allow project sponsors to remove or apply a weight to project 

costs associated with improved environmental and energy efficiency so that these are not penalized in the project development process and cost effectiveness index. 

• Amend Title 49, Section 5309 funds for land acquisition to specifically allow land acquisition for transit-oriented development 

as part of development of corridors under subsections (d) and 

(e). 

• Require environmental analysis to consider regional benefits 

that capture corridor and network environmental benefits.