Asset Publisher

May 1, 2014
« Back

Obama Administration Releases Transportation Bill

On April 29, 2014, the U.S. Department of Transportation (U.S. DOT) released legislative language for the Generating Renewal, Opportunity, and Work with Accelerated Mobility, Efficiency, and Rebuilding of Infrastructure and Communities throughout America Act (GROW AMERICA Act).  The bill would provide $302 billion over four years for the federal government's surface transportation program, including highway, transit, rail, and safety programs. This release follows the Obama Administration's February 2014 announcement of the broad framework for a transportation reauthorization bill, which was subsequently included in its FY 2015 budget proposal.  Moving Ahead for Progress in the 21st Century (MAP-21), the current transportation authorization law, is set to expire on September 30, 2014.

The act includes a number of important themes:

  • Funding: The GROW AMERICA Act provides increased investment levels across the board, but it particularly increases funding for non-highway modes, renaming the "Highway Trust Fund" as the "Transportation Trust Fund" and folding various new programs into it.  GROW AMERICA relies on a one-time infusion of $150 billion in general revenues to both cover the anticipated shortfall in the Transportation Trust Fund and increase total funding by roughly $90 billion over four years.  Although the proposal offers few details, these transfers will be offset by new revenues raised from corporate tax reform.
  • "Fix-It First":  The act emphasizes maintenance of the existing transportation system and includes a new Critical Immediate Investments program to improve pavement conditions on both the National Highway System and the Interstate system's structurally deficient bridges.  The act also expands state-of-good-repair programs for transit.
  • Competitive programs: The act continues the recent interest in competitive programs.  It expands and provides dedicated funding to the Transportation Investments Generating Economic Recovery (TIGER) grant program and also establishes a new Fixing and Accelerating Surface Transportation (FAST) grant program.  FAST would encourage state and local governments to adopt innovative strategies to coordinate transportation, land use, and economic development policies.
  • Freight: For the first time, the act provides dedicated funding for freight improvements, split equally between competitive grants and incentive grants.  The incentive grants would be awarded to states that have established freight advisory councils and completed freight plans; additional incentives would be offered to states that coordinate their plans with neighboring states.
  • Metropolitan planning: The act supports "high-performance" metropolitan planning organizations (MPOs) by increasing the share of Surface Transportation Program (STP) and Transportation Alternatives Program (TAP) funds that they program.  It defines "high-performing" MPOs as those that the Secretary of Transportation determines to have equitable, performance-based decision-making, and to have coordinated planning activities with any other MPOs in its metropolitan statistical area.  The act also directs funding to high-performance MPOs through a new Metropolitan Mobility Program housed within the FAST grant program.  The act expands upon MAP-21's performance measurement requirements to move toward performance-based funding and further expands planning requirements to include new topic areas (e.g., reducing the risk from extreme weather events).  
  • Tolling: The act removes the current restriction barring states from tolling existing Interstate highways and allows states to apply to U.S. DOT for permission to toll after reconstructing an Interstate facility.  The act also allows congestion pricing on existing highways, bridges, and tunnels for traffic management purposes.  It permits the use of toll revenues for transit improvements in priced corridors, along with other strategies to mitigate the adverse impacts of tolling.  The act also requires future toll roads to use electronic toll collection.
  • "Ladders of Opportunity": The act provides $245 million in workforce development grants to support job training opportunities related to the transportation and construction industries.  It also establishes a pilot program to support MPOs in better connecting transportation planning with education and job opportunities.  
  • Innovative financing: GROW AMERICA maintains the MAP-21 emphasis on encouraging private investment in transportation.  The act continues to fund the Transportation Infrastructure Finance and Innovation Act (TIFIA) Program at $1 billion annually, expands the Railroad Rehabilitation and Improvement (RRIF) Program to be more accessible to smaller railroads, and increases the Private Activity Bond (PAB) cap to $19 billion from the current $15 billion.
  • Accelerated project delivery: The act continues MAP-21's emphasis on streamlining project delivery by promoting the concurrent review of transportation projects by federal agencies, increasing collaboration across agencies, and eliminating duplicative requirements. It also provides additional flexibility in the use of federal funds to support environmental reviews and increases the public transparency of the review process by requiring materials to be posted online.
For more information, the U.S. DOT website contains links to various fact sheets organized around 12 themes. The full text of the act is available on-line, as is a section-by-section summary.

Funding Levels 

The GROW AMERICA Act totals $302 billion between FY 2015-18, or about $75.5 billion each year.  This average annual total is a 37 percent increase over the enacted funding levels for FY 2014.  The proposal includes relatively modest increases in funding for highway and safety programs, along with substantial increases in funding for transit and rail programs.  The following table summarizes the broad funding levels to be allocated from the Transportation Trust Fund.

 

Overview of GROW AMERICA funding levels
  FY 2015-18 Total FY 2015-18 Annual Average

Annual Average Increase over FY 2014 levels

TIGER  $5.0  billion  $1.3 billion 108%
Federal Highway Administration (FHWA)  $199.2  billion  $49.8 billion 21%
Federal Transit Administration (FTA)  $72.3  billion  $18.1 billion 69%
Federal Motor Carrier Safety Administration (FMCSA)  $3.0 billion  $0.75 billion 32%
National Highway Traffic Safety Administration  $3.7 billion  $0.92 billion 12%
Federal Railroad Administration (FRA)  $19.1  billion  $4.8 billion 243%
Total  $302.3  billion  $75.6 billion 37%
Source: Transportation Weekly, April 29, 2014.

 

GROW AMERICA appears to provide only inflationary increases in funding for the core highway funding programs and stable funding for the TIFIA credit assistance program.  Rather, much of the 21 percent average annual increase in funding to FHWA programs is driven by a new Critical Immediate Investments Program at $3.4 billion annually, along with a new multimodal freight investment program at $2.5 billion annually.  The new freight program includes a total of $5 billion in discretionary grants over the four-year life of GROW AMERICA, along with a total of $5 billion for incentive grants earned by states.  

On the transit side, GROW AMERICA appears to also provide inflationary increases to three formula core programs (Urbanized Area, Rural Area, and High-Density and Fast-Growth State) and the discretionary transit-oriented development pilot program, but would more than double annual funding to the State of Good Repair and the Bus and Bus Facilities grant programs.  It also expands funding for the New Starts program by nearly 40 percent, from the $1.9 billion enacted in FY 2014 to an annual average of about $2.7 billion between FY 2015-18.  Further, GROW AMERICA provides a total of $2 billion for a new FAST Program.  The act also includes $2.18 billion for a new Rapid Growth Area Program, designed to provide multimodal solutions, including bus rapid transit, in fast-growing areas.  
 
On the rail side, the proposal provides a total of $9.5 billion in funding for passenger rail, a substantial increase over enacted funding levels for FY 2014.  Over half of this funding supports long-distance routes and the Northeast Corridor, and a total of $600 million would assist state corridors.  Metropolitan Chicago is a key hub for both long-distance and state-supported Amtrak routes.  The act also includes a total of $9.55 billion for a Rail Service Improvement Program that enhances existing passenger and freight rail corridors and facilitates the development of new passenger rail corridors.

Looking Forward

The GROW AMERICA Act includes a number of provisions that are broadly consistent with GO TO 2040.  The proposal provides a much-needed boost in funding, empowers regions and local decision-makers, supports congestion pricing, and moves toward more performance-based project selection.  It particularly increases resources for non-highway modes and freight, focuses on repairing existing infrastructure, expands competitive funding programs, better links transportation investments with other policy areas, and supports streamlined project delivery and innovative financing.
 
More specifically, the act's freight provisions are broadly consistent with recent policy efforts undertaken by CMAP.  In February 2014, CMAP and 12 other major MPOs co-signed a white paper that calls for a multimodal perspective on freight policy and at least $2 billion in annual funding for freight improvements. 
 
The act is also consistent with CMAP's efforts around congestion pricing. The draft GO TO 2040 plan update calls on the region to implement express toll lanes on new major capital projects and the existing expressway network.  Amending federal law as called for in GROW AMERICA is critical to the implementation of the latter.  Further, congestion pricing on existing facilities would provide significant traffic management benefits.  
 
Despite these positive reforms, the act's revenue sources are cause for concern.  The $302 billion price tag is far beyond what the Highway Trust Fund (renamed as the "Transportation Trust Fund" in the act) can support from existing user fees, so nearly half of the program's revenues come from General Fund transfers.  In turn, these transfers rely on the successful passage of corporate tax reform to generate new revenues.  GO TO 2040 strongly supports user fees, yet GROW AMERICA would take the federal program even farther from that principle.  
 
Transportation investments are vital to the nation's economy and quality of life, and they require dedicated, long-term funding sources to be successfully planned and completed.  A one-time infusion of $150 billion does nothing to resolve the structural issues facing the Highway/Transportation Trust Fund.  While GROW AMERICA includes many thoughtful and positive reforms, it does not meaningfully advance the vital conversation on adequately funding the nation's infrastructure.
 
CMAP will monitor the progress of the GROW AMERICA Act in Congress and will continue to advocate for the agency's adopted reauthorization principles and federal agenda.
 
 

Comment Permalink

Updates Rss

Loading more updates...