Job Access and Reverse Commute Program: Progress Made in Using Funds and Stakeholder Views on Proposed Program Changes
Published: 2011-05-26T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Established in 1998, the Job Access and Reverse Commute program (JARC)--administered by the Federal Transit Administration (FTA)-- awards formula based grants to states and localities to provide transportation to help low-income individuals access jobs. In 2005, the Safe, Accountable, Flexible, Efficient Transportation Equity Act-A Legacy for Users (SAFETEA-LU) reauthorized this program and made changes, such as allocating funds by formula to subrecipients in three areas--large urban, small urban, and rural--through designated recipients (usually transit agencies and states). SAFETEA-LU required GAO to periodically review JARC. This third report under the mandate examines (1) the progress FTA and recipients have made in reducing the instances and amounts of funds they allowed to lapse without using them; (2) the challenges recipients have faced in implementing JARC; and (3) the tradeoffs, according to stakeholders, of proposals to revise JARC during the next surface reauthorization process. For this work, GAO reviewed FTA grant data; interviewed officials from FTA, 9 designated recipients, 10 subrecipients, and industry associations; and reviewed recent proposals to revise JARC. GAO is not making recommendations in this report. DOT officials reviewed a draft of this report and provided technical corrections, which were incorporated as appropriate.
section_title: What GAO Found
paragraphs: Since GAO's last report on JARC in 2009, the instances of recipients letting their funds lapse--allowing the funds to be reapportioned to all recipients-- have decreased. Recipients have 3 years from the time of apportionment to use the funding before it is reapportioned. In fiscal year 2008, 29 designated recipients, or 11.2 percent, let their entire fiscal year 2006 apportioned funds lapse. In fiscal year 2010, 11 designated recipients, or 4.3 percent, let their entire fiscal year 2008 apportioned funds lapse. In addition, the amount of funds lapsing has decreased. In fiscal year 2008, $16.7 million (12 percent) of apportioned funds lapsed, and fiscal year 2010, $10.2 million (6.5 percent) of apportioned funds lapsed. A few recipients have allowed a large amount of funds to lapse; however, others have made progress in using JARC funds, in part due to FTA's efforts. The designated recipients GAO interviewed reported that they have overcome many of the challenges identified in our 2009 report. This improvement was due in part to actions taken by FTA, such as issuing guidance on project eligibility and providing workshops to help officials in areas where a large portion of JARC funds had lapsed. However, three challenges remain. First, some JARC funds have been allowed to lapse because subrecipients have difficulty providing the local funding required to receive JARC funding. Second, three recipients we interviewed faced challenges coordinating with human service organizations, as required. Finally, officials from three of the five states we interviewed said that the funding classifications they receive either do not align with local demands for JARC services or create confusion among local area recipients. Stakeholders have proposed changing JARC. Officials GAO interviewed cited various tradeoffs to these proposals. Some proposals would combine JARC with other transit programs designed to help people who are elderly and/or have disabilities. Proponents of these proposals cited potential benefits such as increased flexibility to use funding to meet specific needs, while critics of these proposals were concerned that targeted populations will no longer receive the same amount of funding unless they are protected.

section_title: Letter
paragraphs: Access to transportation is critical for enabling low-income individuals to  find and retain employment. To help provide this access, Congress  established the Job Access and Reverse Commute program (JARC) in  1998. Administered by the U.S. Department of Transportation’s (DOT)  Federal Transit Administration (FTA), JARC provides grants to states and  localities to fill gaps in transportation services for low-income individuals  needing access to jobs and related services, such as child care and  training. JARC funds can also be used to fund public transportation  projects designed to transport residents of urbanized areas and other than  urbanized (rural) areas to suburban employment opportunities regardless  of income. In 2005, JARC was reauthorized through the Safe, Accountable,  Flexible, Efficient Transportation Equity Act–A Legacy for Users  (SAFETEA-LU), which authorized $602.5 million for the program for fiscal  years 2006 through 2009. In March 2011, JARC’s funding authorization was  extended through fiscal year 2011, with the Surface Transportation  Extension Act of 2011.
SAFETEA-LU required us to evaluate JARC 1 year after the legislation  took effect and every 2 years thereafter. We previously reported that JARC  provides an important benefit to low-income individuals, but also that  states and localities have not always submitted projects for FTA to  obligate JARC funds within the allowable time period. When these  unobligated funds lapse most of the funds are lost to the original states  and/or large urbanized areas when they are reapportioned to all recipients.  Thus, most of the benefit of those funds is lost to individuals in those areas  who might have benefited from JARC services. FTA reapportions lapsed  funds across all recipients in subsequent years, including those areas that  allowed funds to lapse. Our 2009 report identified challenges, such as  delays in issuing final program guidance and identifying designated  recipients, faced by designated recipients and subrecipients and we  recommended actions that FTA or Congress could take to address these  challenges. In response to our 2009 report, DOT indicated that FTA  continues to provide guidance and technical assistance to help recipients  address the challenges of JARC and continues to discuss opportunities to  simplify the program in the next reauthorization. In addition, DOT  indicated that a decrease in the percentage of funds recipients allowed to  lapse after fiscal year 2009, compared with the prior fiscal year, indicates  that recipients are improving their efforts to meet the challenges that had  caused funds to lapse. Anticipating the reauthorization of SAFETEA-LU  during 2009, several stakeholders—including legislators, DOT, and public  interest groups—proposed modifications to JARC. These proposed  changes include funding changes, revisions to specific program  requirements, and merging JARC with various other transit programs.
This report—our third in response to the SAFETEA-LU mandate— addresses FTA’s progress in implementing changes to JARC. Our specific  reporting objectives were to determine:  1.  the progress FTA and designated recipients have made in reducing the  instances and amounts of lapsed funds;  2.  the challenges designated recipients and subrecipients have faced in  3.  the tradeoffs, according to stakeholders, of proposals to revise JARC  in the surface transportation reauthorization process.
To address these objectives, we reviewed relevant laws and FTA guidance.  We also interviewed FTA officials, select JARC designated recipients and  subrecipients, and industry stakeholders. We obtained and analyzed data  from FTA’s Transportation Electronic Awards and Management system  and FTA’s Web site to determine the amount of FTA’s apportionments for  JARC and the extent to which JARC funds have been allowed to lapse. We  assessed the reliability of these data by comparing FTA’s data with data  from designated recipients and interviewing FTA officials about their  procedures. We determined that the data were sufficiently reliable for the  purposes of our report. To examine challenges recipients have  encountered in implementing the program, we interviewed 9 designated  recipients and 10 subrecipients in five states and compared the challenges  they reported to those we identified in our 2009 report. We selected the  designated recipients based on criteria that included jurisdictions where  funds had been allowed to lapse as well as states identified through  industry association contacts. We selected subrecipients that covered the  three areas that were apportioned JARC funding under SAFETEA-LU— large and small urbanized areas plus rural areas—as well as those that  designated recipients recommended. Since we used a nongeneralizable  sampling approach, the results of these interviews cannot be used to make  inferences about all designated recipients and subrecipients. We also  interviewed stakeholders and officials from industry associations,  including the American Association of State Highway and Transportation  Officials and the Community Transportation Association of America, to  obtain their broader views on challenges associated with implementing  JARC and potential program modifications. To determine the advantages  and disadvantages of JARC modification proposals, we reviewed  published proposals and discussed modification concepts with designated  recipients, subrecipients, and stakeholder organizations.
We conducted this performance audit from July 2010 through May 2011 in  accordance with generally accepted government auditing standards. Those  standards require that we plan and perform the audit to obtain sufficient,  appropriate evidence to provide a reasonable basis for our findings and  conclusions based on our audit objectives. We believe that the evidence  obtained provides a reasonable basis for our findings and conclusions  based on our audit objectives. See appendix I for more information about  our scope and methodology.
subsections: section_title: Background
paragraphs: Congress created JARC in the 1998 Transportation Equity Act for the 21st  Century to support the nation’s welfare-reform goals—including helping  adults meet new work requirements to receive federal assistance. A  purpose of JARC was to improve the mobility of low-income individuals  through grants that states and localities could use to provide additional or  expanded transportation services and thus provide more opportunities for  individuals to get to work. Accessing entry-level jobs can be challenging  for low-income individuals, many of whom do not own cars, have poorly  maintained cars that are not sufficient for daily commuting, or do not have  access to transit options that link them to jobs.
In 2005, SAFETEA-LU made several changes to JARC. Notably, SAFETEA- LU created a formula to distribute $602.5 million over 4 years beginning  with fiscal year 2006 and required that state or local recipients be  designated to competitively allocate JARC funds. These recipients are  responsible for distributing funds to other agencies. SAFETEA-LU  required that 40 percent of JARC funds be apportioned annually among  states for projects in small urbanized and rural areas (those with  populations of 50,000–199,999 and less than 50,000, respectively). It also  required that the remaining 60 percent be apportioned among large  urbanized areas (those with populations of 200,000 or more). In fiscal year  2010, a total of $175 million in JARC funds were apportioned to designated  recipients.
JARC funds must be obligated within a certain time period, can be used  for some administrative activities, and must be supplemented by local  funding. Funds must be obligated within 3 years from the time of  apportionment or they lapse. Lapsed funds are reapportioned among all  states and large urbanized areas in the following fiscal year. For example,  $18.6 million in JARC funds apportioned for fiscal year 2006 was allowed  to lapse, per FTA records, at the end of fiscal year 2008. Accordingly, FTA  increased the JARC apportionments for fiscal year 2009 by $18.6 million.  The reapportionment process allows lapsed JARC funds to be used in  other areas. SAFETEA-LU authorizes states and large urbanized areas to  use 10 percent of JARC funds for administrative activities, including  planning and coordination activities. Currently, the federal government’s  cost share for JARC projects is limited to no more than 80 percent for  capital costs and no more than 50 percent of operating costs. For example,  if a subrecipient purchases a bus with JARC funds, it is eligible for up to 80  percent federal funding; however if JARC funding is used for operating the  bus (bus drivers, fuel, etc.), it is eligible for up to 50 percent federal  funding.
SAFETEA-LU also required JARC recipients to fulfill specific requirements  and follow specific processes (see fig. 1).
In addition to the requirement that a recipient be designated to  competitively allocate JARC funds, SAFETEA-LU required that designated  recipients certify that JARC projects are derived from locally developed,  coordinated public transit-human service transportation plans. The  coordinated planning process must include representatives of public,  private, and nonprofit transportation and human services providers and  participation by the public. Furthermore, SAFETEA-LU required that  states and large urbanized areas develop and conduct a competitive  selection process for their projects. After projects are selected, states and  urbanized areas must apply to FTA to fund the projects.
Recipients have used JARC funds for a wide variety of projects to help  low-income workers get to jobs and related activities. Many projects  expand the service area or extend the hours of existing bus routes. For  example, in Danbury, Connecticut, JARC funds were used to add evening  and weekend hours to an existing bus route. Some projects fund van pools  that take groups of workers to work sites. For example, JARC funds were  used for both capital and operating expenses for a van pool to  employment centers from a rural area in Texas. Other projects pay for  vehicle loans or vehicle repairs. For example, a human service  organization in Dodgeville, Wisconsin—a rural area without transit—uses  JARC funds to provide low-interest car loans to low-income workers. As of  2009, the program helped 352 low-income individuals obtain loans to  purchase a car for work. See appendix II for more information on types of  projects supported by JARC funds.
In addition to JARC, other federal transit programs support transportation  for specific purposes and populations. For example, the New Freedom  program, created by SAFETEA-LU, supports new public transportation  services and public transportation alternatives beyond those required by  the Americans with Disabilities Act. In fiscal year 2010, $99 million was  apportioned for this program. The Elderly Individuals and Individuals with  Disabilities program (commonly referred to as the Section 5310 program),  has existed since 1975. The Section 5310 program originally provided  formula funding for capital projects to help meet the transportation needs  of elderly individuals and persons with disabilities. In 1991, Congress  expanded the Section 5310 program to allow funds to be used to acquire  services to promote the use of private-sector providers and to coordinate  with other human service agencies and public transit providers. In fiscal  year 2010, $134 million was apportioned to state agencies for Section 5310.  SAFETEA-LU requires that both of these programs, as with JARC, certify  that projects be derived from a locally developed, coordinated public  transit-human services transportation plan. FTA’s Urbanized Area Formula  Grant Program (Section 5307) and Other Than Urbanized (Rural) Area  Grant Program (Section 5311) also provide formula funds for general  public transit programs. The Section 5307 program provides transit  funding for large and small urbanized areas, while the Section 5311  program provides transit funding for rural areas. In fiscal year 2010, $4.6  billion was apportioned for these programs: $4.1 billion for the Section  5307 program and $438 million for the Section 5311 program.
In our 2009 report on JARC, we found that about 14 percent of the fiscal  year 2006 JARC funds lapsed, in part due to the fact that some applicants  did not meet administrative requirements, such as developing a  coordinated public transit-human service transportation plan, in time to  apply for funds. We also found that recipients faced several challenges in  implementing JARC, including the inability to provide the required local  match, and that overall, the effort required to obtain JARC funds was  disproportionate to the relatively small amount of funding available.
section_title: Recipients—with FTA Help—Have Made Progress Using Apportioned Funds, but a Few Areas Continue to Let Funds Lapse
subsections: section_title: Recipients Have Made Progress Using JARC Funds
paragraphs: JARC funds have been apportioned to 258 geographic areas and each year  since SAFETEA-LU was enacted the number of designated recipients  allowing JARC funds to lapse has decreased. Where JARC funds lapsed,  the designated recipients lost the funds and those funds were FTA  reapportioned to all designated recipients. For fiscal year 2006  apportionments, at least some of the JARC funds were allowed to lapse in  49 areas at the end of fiscal year 2008. The number of areas where funds  lapsed dropped to 45 at the end of fiscal year 2009 and then to 37 at the  end of fiscal year 2010.
Further, the number of recipients allowing all their JARC funds to lapse  decreased steadily from the end of fiscal year 2008 through 2010. In fiscal  year 2008, 29 designated recipients (or 11.2 percent of all designated  recipients) let all funds apportioned in fiscal year 2006 lapse. By the end of  fiscal year 2010, 11 designated recipients (or 4.3 percent of all designated  recipients) allowed all the JARC funds to lapse that were apportioned to  them for fiscal year 2008. (See fig. 2.)
section_title: The Amount of Funding Allowed to Lapse Decreased
paragraphs: In addition, the amount of funding allowed to lapse also steadily declined  from the end of fiscal year 2008 through 2010. In fiscal year 2008,  approximately $16.7 million, or 12 percent of all apportioned funds, were  allowed to lapse. By the end of fiscal year 2010, the amount of lapsed  funds had dropped to about $10.2 million, or 6.5 percent of all funds  apportioned for fiscal year 2008. (See fig. 3)
section_title: A Few Jurisdictions Allowed Large Amounts of Funds to Lapse
paragraphs: Recipients allowing JARC funds to lapse were concentrated in three  southeastern states—Florida, Mississippi, and North Carolina—plus the  Commonwealth of Puerto Rico. Recipients in those jurisdictions  accounted for 77.4 percent of the $39.5 million that was allowed to lapse  from the $436.6 million apportioned to JARC recipients for fiscal years  2006, 2007, and 2008. Puerto Rico alone accounted for $18.9 million, or 48  percent, of funds allowed to lapse during this period. Florida’s large  urbanized area recipients allowed $4.8 million in JARC funds to lapse.  Recipients in Mississippi and North Carolina accounted for more than $3  million in lapsed funds for each state. According to designated recipients  and FTA officials, recipients allowed funds to lapse for reasons that  included lack of proposals from potential project sponsors and a lack of  matching funds. We discuss these reasons in more depth later in the  report.
Recipients in 30 other states allowed $8.9 million of JARC funds to lapse;  in no case did the amount of funds allowed to lapse in any of these  jurisdictions exceed $1 million (see fig. 4). Some of these lapses were not  due to lack of interest in taking advantage of the JARC program or other  program-related barriers, according to DOT officials. Rather, in some  cases, funds lapsed because the grant recipients’ budgets for JARC  projects totaled less than the entire amount of JARC funds available. The  remaining unobligated funds could range from several hundred dollars to  several thousand dollars. Designated recipients—state agencies and large  urbanized areas—in 21 states and the District of Columbia allowed none of  the $65.5 million in JARC funds apportioned to them to lapse for fiscal  years 2006 through 2008.
section_title: Recently These Areas Have Made Progress in Using JARC Funds
paragraphs: Recipients in Puerto Rico, Florida, North Carolina, and Mississippi have  shown progress recently toward reducing the amount of funds allowed to  lapse.
Puerto Rico allowed $13.6 million to lapse for fiscal years 2006 and 2007— all its JARC funds apportioned for those years—but was able to use $2.2  million of its fiscal year 2008 funds for San Juan, a large urbanized area,  plus $72,000 of its small urbanized area fiscal year 2008 funds.
Florida’s lapsed funds were limited to its large urbanized areas. For fiscal  year 2006, among Florida’s 12 large urbanized areas, 8 areas used all their  JARC funds, while 4 areas allowed $3.2 million, their entire  apportionments, to lapse. For fiscal year 2007, three large urbanized  areas allowed apportionments to lapse—Daytona Beach-Port Orange  allowed all of its apportionments to lapse, while Miami and Tallahassee  allowed part of their JARC apportionments to lapse. By the end of fiscal  year 2010, Florida’s recipients no longer allowed funds to lapse.
North Carolina allowed 62.8 percent of its fiscal year 2006 apportionments  for small urbanized areas and rural areas to lapse. In contrast, the  percentage of funds lapsed for those areas was 40.1 percent for 2007  apportionments and 25.3 percent for 2008 apportionments.
One of Mississippi’s two large urbanized areas, Gulfport-Biloxi, allowed all  its funds to lapse in fiscal year 2006, but all of that area’s JARC funds were  obligated for fiscal years 2007 and 2008. However, recipients continue to  allow much of Mississippi’s rural and small urban areas funds to lapse.
section_title: FTA Staff Have Worked With Officials to Reduce Instances of Lapsed Funds
paragraphs: Lapsed funds remained a significant issue at the end of fiscal year 2010 for  Puerto Rico, Mississippi, and, to a lesser extent, North Carolina. To  address lapsed funds, FTA’s Region IV staff reported working extensively  with officials in these three jurisdictions to help local officials more  effectively use JARC funds.
FTA staff began working with Puerto Rico in December 2007 and through  most of 2010 conducted a series of workshops and quarterly meetings with  the local officials to help Puerto Rico use its JARC apportionments. The  first eligible project application for Puerto Rico was submitted in August  2010, but it still allowed more than $5 million to lapse at the end of fiscal  year 2010, or 70 percent of the $7.6 million apportioned to Puerto Rico for  fiscal year 2008.
FTA staff reported working with Mississippi officials at annual Mississippi  transit conferences and also having the United We Ride Ambassador  facilitate workshops in Mississippi to raise interest in the program.  Furthermore, FTA regional staff reported providing technical assistance  for officials in Jackson, the large urbanized area in Mississippi that has  allowed all its JARC funds to lapse. The United We Ride Ambassador  conducted regional coordinated planning workshops in Mississippi to help  local officials develop their regional coordination plans and identify  sources of matching funds. After the end of fiscal 2010, Mississippi  recipients let $1.5 million lapse, or 92 percent of the funds apportioned for  Mississippi for fiscal year 2008. According to the Ambassador, as of  February 2011, Mississippi officials were making progress at identifying  sources of matching funds needed to use available JARC funds.
By the end of fiscal year 2010, more than $3 million was being used by  North Carolina, but more than $650,000 was allowed to lapse for small  urbanized areas and rural areas, plus $174,000 (or all funds) for  Fayetteville for fiscal year 2008. FTA Region IV officials reported providing  technical assistance and holding a workshop for Fayetteville. To help  North Carolina’s small urbanized areas better use their JARC  apportionments, FTA staff reported assisting with coordinated plan  development in 2008 and working with North Carolina officials at  workshops, state conferences, and quarterly meetings with state officials.  The United We Ride Ambassador conducted coordinated planning  workshops in North Carolina to help local officials understand the  coordinated planning process and identify sources of matching funds.
section_title: FTA Addressed a Number of Challenges Recipients Had Identified Implementing JARC, but Three Challenges Remain
paragraphs: Our 2009 report on JARC indicated that recipients had specific challenges  implementing the program. Challenges were primarily related to  administratively setting up and implementing the program given changes  in SAFETEA-LU. Designated recipients we spoke with more recently  indicated that the types of challenges they faced in 2009 had generally  been addressed. However, three challenges remain:    Limited funding available to provide the local match.
Coordination with human services organizations can be difficult.
Formula funding not aligned with local demands.
subsections: section_title: FTA Has Taken Steps to Address Difficulties Recipients Faced
paragraphs: The designated recipients and subrecipients we interviewed reported that  they have overcome many of the challenges we identified in our 2009  report. Specifically, most of the designated recipients that we interviewed  had (1) instituted procedures to solicit grant applications and select  projects competitively; (2) created locally developed, coordinated public  transit-human services transportation plans; and (3) designated recipients  identified for all areas. Among the nine designated recipients that we  interviewed, four said that the program is less challenging to implement  than it was in the past and four said the challenges have not changed or  new challenges have replaced older ones, while one said the program is  more challenging because of increased applications, among other things.
Some designated recipients attribute the improvement to actions taken by  FTA to help recipients overcome barriers to using JARC funds. First, in  May 2007, FTA finalized implementing guidance to help recipients better  understand the change to the “new” formula program. Second, FTA  officials answered many questions that designated recipients had raised  about running competitions and determining project eligibility. FTA  regional offices, and in some cases FTA headquarters, have worked to  respond to recipient questions about project eligibility. For example, a  recipient indicated that when they had questions their regional office  worked closely with them to resolve their questions. Finally, FTA has  provided outreach to specific jurisdictions that were slower to use JARC  funds.
section_title: Increased Difficulty in Providing Required Local Match Has Resulted in Lapsed Funds
paragraphs: According to most of the recipients and subrecipients we spoke with,  providing a local match has increasingly become a challenge, particularly  with current economic conditions, and in some locations recipients  allowed JARC funds to lapse because local officials are unable to provide  matching funds. JARC requires that recipients supply a local match to  receive funding. The program requires at least a 20 percent local match for  capital expenses and a 50 percent match for operating expenses. The  recipients we interviewed indicated that they use several different sources  of matching funds, including local taxes, toll credits, and in-kind services.  In addition, as permitted by statute, some recipients have used other  sources of federal funds such as Temporary Assistance for Needy Families  (TANF).
Officials in some FTA regional offices and states reported that recipients  allowed funds to lapse in some areas because they were not able to match  federal funds. FTA officials in one region said that it is difficult for  grantees to justify using funding for JARC projects that would establish  new routes while simultaneously cutting existing services due to  constrained budgets. In the two jurisdictions—Mississippi and Puerto  Rico—in which nearly all funding lapsed, a Mississippi Department of  Transportation official and FTA officials partially attributed the lapses to  the inability to provide matching funds. Some FTA officials and designated  recipients that we interviewed said that, in some cases, JARC funds were  allowed to lapse because they chose to use their local funds for other  programs that are less burdensome and provide more funding.
section_title: JARC Recipients in Three Areas Reported that Coordination with Human Services Organizations Can Be Difficult
paragraphs: While not a challenge in all jurisdictions, recipients in three areas  indicated that coordination with other human service organizations that  provide transportation services was difficult. JARC recipients are required  to participate in a local coordinated transportation planning process at  least every 4 to 5 years to receive funding. As previously mentioned,  human service funding, for example TANF funding, can be a potential  match to federal JARC funds. According to data from the Department of  Health and Human Services, among the 60 percent of states that used  TANF funding for transportation, about $270 million was used for  transportation assistance in fiscal year 2009. However, according to the  three designated recipients that we interviewed, human service  organizations’ funding sources generally don’t have the same requirement  to coordinate in order to receive funding and therefore they may be less  inclined to participate in the process. Officials from one state told us that  involving the human service community in a coordinated plan can  sometimes be difficult, but some activities, such as providing funding for  local mobility managers, have made this easier.
State requirements can help subrecipients fulfill the coordinated planning  requirement. Officials from one state we spoke to indicated that their state  had a state requirement for a coordinated plan prior to the JARC  requirement, and another state’s officials indicated that their coordinated  transportation planning process began 15 years ago. For example,  Connecticut had a collaborative and jointly planned and funded access to  jobs program prior to JARC because Connecticut’s welfare reform  mandates predated federal welfare reform and JARC. Thus, meeting the  JARC requirement that the projects come from the plan is relatively easy  to meet as they already know and have relationships with the right people.  On the other hand, officials from three states indicated that the  coordinated plan was difficult to do.
section_title: In Some Areas, Officials Reported that Area and Program Funding Classifications Create Challenges
paragraphs: In some locations, state transportation officials indicated that JARC  funding apportionments created confusion and did not align with needs.  SAFETEA-LU’s formula apportions funds by large and small urbanized  area and rural area classifications. While these classifications allow  designated recipients to transfer funds among small urban and rural areas,  the funds can not be distributed away from large urban areas. As we  reported in our 2009 report, some state transportation department officials  indicated that eliminating the urbanized area limits would give designated  recipients funds where they see the most need, such as rural areas with  fewer resources than large urbanized areas. Officials from three states that  we interviewed suggested that it would be beneficial to remove these  classifications and give designated recipients, usually states, discretion to  allocate funds as they see fit across rural areas and small and large  urbanized areas because local area recipients find the process confusing.  Furthermore, officials from one state said that they could better address  state needs if they had more flexibility about where to allocate funds.  Officials from two states indicated that they had a good state process and  would be willing to conduct such project competitions in large urban areas  as well. Finally, two states already do that for all areas—rural, small urban,  and large urban.
Some officials we spoke to also mentioned that the needs for other  programs outweighed the needs for JARC. For example, officials from one  FTA regional office indicated they see a bigger demand for New Freedom  program funds than JARC. In addition, one designated recipient indicated  that its New Freedom funds are smaller than JARC funds, but the response  to calls for projects is greater under the New Freedom program. An official  at a state department of transportation reported that the biggest need is  for elderly and disabled programs like Section 5310.
section_title: Proposals to Revise JARC Engender Tradeoffs
paragraphs: Transportation interest groups, legislators, and DOT have issued proposals  to revise JARC since 2008. These proposals generally were offered to help  Congress consider JARC provisions in the next surface transportation  reauthorization. The proposals advance three broad concepts for  reauthorizing JARC: (1) streamline JARC by merging it with other related  programs, (2) revise JARC funding amounts or matching requirements,  and (3) revise transportation coordination provisions. See the sources and  topics addressed by these proposals in table 1. See appendix III for further  information on these proposals.
subsections: section_title: Proposals to Consolidate JARC with Other Transportation Programs May Improve Efficiency and Flexibility but Might Disadvantage Some Stakeholders
paragraphs: Eight of the 10 proposals we examined would consolidate JARC with other  related programs, generally to improve program efficiency and/or  flexibility. Four proposals recommended combining JARC with FTA’s  other specialized programs for transportation-disadvantaged  populations—the New Freedom program for people with disabilities and  the program for Elderly Individuals and Individuals with Disabilities  (Section 5310). The President’s Budget Request for Fiscal Year 2012  proposes combining JARC with the New Freedom and the Section 5310  programs. The combined program would continue goals of the current  programs. However, other proposals suggested merging JARC with other  programs. As noted in our 2009 JARC report, the American Association of  State Highway and Transportation Officials proposed consolidating JARC  with FTA’s Urbanized Area Formula Grant Program (Section 5307) and  Other Than Urbanized (Rural) Area Grant Program (Section 5311). The  Community Transportation Association of America proposed new urban  and rural transit programs that would each include JARC elements. The  National Transportation Policy Project proposed combining JARC in an  essential access program that would include the Safe Routes to School  program, the Over the Road Bus Accessibility program, as well as New  Freedom and Section 5310 programs.
In general, consolidating JARC with other programs could offer greater  program efficiency and flexibility:    The U.S. House of Representatives Committee on Transportation and  Infrastructure reported that its proposal would reduce the administrative  burden on both the grantees and FTA by creating a unified program  application to achieve a variety of mobility and access goals.
Combining JARC with the New Freedom and Section 5310 programs  would, as noted in support for two plans, maintain the importance of  coordination already implied by the locally developed, coordinated public  transit-human services transportation plan already required by SAFETEA- LU.
Four recipients we talked with would like to see a combination of  programs as it could give them more flexibility in terms of how they  allocate the grants to meet the transportation gaps specific to their area.  For example, one state said it has more demand for services to help people  who are elderly and/or have disabilities than for JARC grants and could  better respond to state priorities by shifting its JARC funds to New  Freedom or Section 5310 programs.
Combining JARC and related programs may have disadvantages for some  stakeholders:    As we noted in our 2009 JARC report, associations representing people  who are elderly and those with disabilities expressed concern that  consolidating these programs with JARC would jeopardize transportation  to these populations. Without a set-aside for various populations, some  may not be assured that the funding levels would remain steady for their  population group. The consolidation proposal by the U.S. House of  Representatives Committee on Transportation and Infrastructure provided  minimum funding targets to protect funds for specific populations during  the first year of the consolidated program and other protections in later  years. However, officials in one state that we interviewed were concerned  that while it would increase flexibility, it would not simplify reporting.
Not every designated recipient may want the flexibility to determine  funding allocations between the populations now served by the current  programs because creating more discretion for designated recipients will  also bring more political pressure to their role, according to a state  program director.
Two recipients indicated that FTA’s implementation of a consolidated  program would impact the extent to which they would benefit from this  flexibility. In other words, if FTA were to still treat these as separate  programs in terms of reporting, it may not decrease the administrative  burden.
An official from a small urbanized area transit system said that the current  programs are easy to explain to local officials as separate programs and  the reporting requirements are straight-forward. Combining programs  might result in a more complex program that could be more difficult to  explain and could involve complicated reporting to track benefits provided  to different population groups.
section_title: Proposals to Alter JARC Funding Could Improve Program Effectiveness and Help Prevent Funds from Lapsing, but Might Reduce Overall Scope of JARC
paragraphs: The JARC proposals we examined addressed two types of funding  changes—increasing the federal funds directed to the program and  changing the match ratios that JARC subrecipients have to meet in their  project proposals. Two proposals we examined suggested increasing the  amount of funding for JARC or its successor program.
Transportation for America’s proposal would increase funding by an  unspecified amount for a new program that consolidates the JARC, New  Freedom, and Section 5310 programs. According to the proposal, the  advantage of this change would be to help low-income and other  populations that are inadequately served by existing transit programs.
The 2008 Obama-Biden Plan proposed doubling JARC funding in order to  ensure that additional federal public transportation dollars flow to the  highest-need communities.
In addition, three proposals we reviewed would adjust match  requirements:    The Community Transportation Association of America’s proposal would  reduce local operating match requirements from 50 percent to 20 percent.
The 2008 DOT proposal—Refocus. Reform. Renew. A New Transportation  Approach for America—would reduce the local match requirement for  both capital and operating expenses to 10 percent.
S. 176, 111th Cong. (2009) would reduce the local match requirement for  operating expenses of a JARC project as an incentive for projects that  coordinate with programs serving other transportation-disadvantaged  populations.
Reducing the local matching requirement could reduce the incidence of  lapsed JARC funds. As previously discussed, some recipients told us that  lack of match was a reason that their apportioned funds were allowed to  lapse. Other recipients said that their current matching funds are just  enough to support their current grants and they expect that it will be more  difficult for those match sources to sustain their JARC support in the  future. Lower match rates could have the disadvantage of reducing the  overall spending for JARC. For example, we earlier reported that matching  funds are important to maintaining recipients’ level of spending for a  program. Thus, if project sponsors rely more heavily on federal funds  then fewer local funds will likely be used to support programs, and total  program expenditures may decline.
section_title: Proposals Suggest Improving JARC’s Coordination with Other Transportation Programs for the Transportation- Disadvantaged
paragraphs: SAFETEA-LU required recipients of FTA’s three grant programs for the  transportation-disadvantaged to develop a coordinated plan. We  previously noted that JARC recipients in three areas we spoke to still  indicated that coordination with human service organizations was  difficult. We reported in 2009 that some recipients had suggested that  federal agencies that provide and allow funds to be used for transportation  services should require grantees to participate in coordinated  transportation planning efforts.
A reauthorization proposal, as previously noted, would provide an  incentive for projects that coordinate at least two of the three FTA grant  programs for the transportation-disadvantaged. Coordination among all  federal transportation programs for the transportation-disadvantaged has  been a concern noted in our prior reports. Our reports in 2003 and 2004  analyzed federal spending aimed at transportation-disadvantaged  populations. While the full extent of such spending could not be  determined, available data showed federal expenditures of $2.4 billion, of  which just $317 million, or 13 percent, was by DOT programs.  Furthermore, we reported in 2011 that, to assure coordination benefits are  realized, Congress may want to consider requiring key programs to  participate in coordinated planning. The American Public Transportation  Association’s 2008 proposal would require changes in authorizing laws for  transportation, health, and human services to assure coordination and  cost-sharing between agencies for human services transportation. The  Community Transportation Association of America’s 2009 proposal for  streamlined urban, rural, and intercity programs would, according to the  proposal, end the proliferation of stand-alone transportation programs,  each with its own guidance, regulations and purposes. The Community  Transportation Association of America also proposed that these new  programs would be funded partly by $3 billion in transfers from other  federal programs.
section_title: Agency Comment
paragraphs: DOT reviewed a draft of this report and provided technical corrections,  which were incorporated as appropriate.
We are sending copies of this report to congressional committees with  responsibility for transit issues, the Secretary of Transportation, and the  Administrator of the Federal Transit Administration. In addition, the  report will be available at no charge on the GAO Web site at  http://www.gao.gov.
If you have any questions regarding this report, please contact me at   (202) 512-2834 or at wised@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. GAO staff who made major contributions to this report are  listed in appendix IV.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: The Safe, Accountable, Flexible, Efficient Transportation Equity Act–A  Legacy for Users (SAFETEA-LU) requires that we evaluate the Job Access  and Reverse Commute program (JARC) every 2 years. This report  addresses (1) the progress the Federal Transit Administration (FTA) and  recipients have made in reducing the instances and amounts of lapsed  funds; (2) the challenges recipients have faced in implementing JARC; and  (3) the tradeoffs of proposals to revise JARC, according to stakeholders,  during the upcoming surface transportation reauthorization process.
To determine the extent to which FTA and recipients have made progress  in reducing the instances and amounts of lapsed funds, we obtained and  analyzed data from FTA’s Transportation Electronic and Awards  Management system and apportionment data from FTA’s Web site. We  used these data to determine the amount of FTA’s apportionments for  JARC and the extent to which JARC funds lapsed. We did not include  restored funding of $1.9 million for California and almost $1 million for  Washington, D.C., in our analysis of funds allowed to lapse because these  designated recipients had access to the funds in subsequent fiscal years.  Although these funds show up as lapsed in FTA’s Transportation  Electronic and Awards Management system data, they were restored for  specific reasons such as initial coding errors. In addition, we assessed the  reliability of these data by (1) obtaining information from the system  manager on FTA’s data reliability procedures and (2) comparing FTA’s  data with data from designated recipients. We discussed discrepancies  with FTA officials. We determined that the data were sufficiently reliable  for the purposes of our report.
To examine challenges recipients have encountered in implementing the  program, we interviewed 9 designated recipients and 10 subrecipients in  five states and compared the challenges to those we identified in our 2009  report. We selected the nine designated recipients based on criteria to  achieve a mix of the following criteria:    some were located in areas that have allowed funds to lapse;    some had been previously interviewed for our May 2009 report;    all were chosen to provide diversity across geographic locations; and    some were identified through an industry association contact.
We selected subrecipients that covered the three areas that were  apportioned JARC funding under SAFETEA-LU—large and small  urbanized areas plus rural areas—as well as those that designated  recipients recommended. Since we used a nongeneralizable sampling  approach, the results of these interviews cannot be used to make  inferences about all designated recipients and subrecipients. In addition,  we interviewed FTA regional officials for each of these selected areas.  Table 2 lists the 9 designated recipients and 10 subrecipients that we  interviewed.
We also interviewed FTA regional and state officials in areas that allowed  the greatest amount of funds to lapse including Mississippi, North  Carolina, and Puerto Rico. In addition, we interviewed the United We Ride  Ambassador responsible for these areas. We interviewed stakeholders and  officials from industry associations, including the American Association of  State Highway and Transportation Officials and the Community  Transportation Association of America, to obtain their views on challenges  associated with implementing JARC and potential program modifications.
To identify proposals to modify JARC issued since 2008 we conducted a  literature search and interviewed FTA officials. To determine the  advantages and disadvantages of these proposals, we reviewed published  proposals; identified common features of these proposals; and discussed  modification concepts with designated recipients, subrecipients, and  interested stakeholder organizations.
We conducted this performance audit from July 2010 through May 2011 in  accordance with generally accepted government auditing standards. Those  standards require that we plan and perform the audit to obtain sufficient,  appropriate evidence to provide a reasonable basis for our findings and  conclusions based on our audit objectives. We believe that the evidence  obtained provides a reasonable basis for our findings and conclusions  based on our audit objectives.
section_title: Appendix II: JARC Activities
paragraphs: JARC funds are available for operating expenses and capital expenses that  support services to transport low-income individuals to and from jobs and  activities related to their employment. Eligible projects may include, but  are not limited to, activities such as:  late-night and weekend service,   guaranteed ride home service,    expanding fixed-route public transit routes,  ridesharing and carpooling activities, transit-related aspects of bicycling, local car loan programs that assist individuals in purchasing and  maintaining vehicles for shared rides, and   promoting the use of transit by workers with nontraditional work  schedules.
An FTA report, dated October 2010, showed the specific types of JARC  services being offered during fiscal year 2009. The report was based on  data from 171 JARC grant recipients who reported on 910 services.  According to that report:  trip services—transportation provided directly to individuals—accounted  for 81 percent of the service types reported;  information services—for example, mobility managers—accounted for 10  percent of the service types reported; and   capital investment projects—for example, vehicle loans, purchases, and  technology investments—accounted for 9 percent of the service types  reported.
Within the trip services category, the top four service categories reported  were “fixed route,” “demand response,” “flexible route,” and  “shuttle/feeder.” Within the capital investment projects category, the top  three services were “vehicle for agency,” “vehicle for individual,” and  “Intelligent Transportation Systems investments.” Agencies used JARC  funds to acquire more than 80 vehicles and provided about 870 automobile  loans to individuals. Figure 5 lists the number of each type of JARC service  in fiscal year 2009.
section_title: Appendix III: Proposed Changes to JARC
paragraphs: In 2005, JARC was reauthorized through SAFETEA-LU, which authorized  $727 million for the program for fiscal years 2005 through 2009. Sponsors  listed in table 3 developed proposals in anticipation of reauthorization of  this legislation.
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Catherine Colwell (Assistant  Director), Richard Calhoon, Colin Fallon, Kathleen Gilhooly, Sara Ann  Moessbauer, and Stephanie Purcell made important contributions to this  report.