Federal transit chief gives criteria for urban rail-project funding
As the Sunbelt cities of Miami, Tampa, Houston, and Los Angeles compete with frost belt cities for mass-transit money, the head of the federal agency that funds rail and bus systems says the cities that can prove they need the systems to solve traffic problems will be first in line to get the money.
And, said Ralph L. Stanley, administrator of the Urban Mass Transit Administration (UMTA), federal money more likely will go to cities that can prove they will be able to pay their mass-transit operating deficits once those systems are built.
''Competition now is steep for federal mass-transit money,'' says Mr. Stanley. ''Literally dozens of cities are looking at mass-transit funds just because the money is there. All too often, cities decide to launch a mass-transit project because they need to provide more jobs. They come to Washington first to see if they can get the money, and then they go back to the voters to see if they want it. That's not the way it should be done.''
A city seeking some of the $400 million generated annually by the 1 -cent-a-gallon federal gasoline tax that is now set aside for mass transit should first prove that it has a need for a system to help relieve traffic problems, he said.
Then, it must show how it will raise the money to pay for the inevitable operating deficit.
He called the Washington, D.C., Metro ''an example of how not to do it'' (get money to operate a rail system). The Washington metropolitan area will face a $ 500 million annual operating deficit when the Metro system is completed, he said , and the governments that make up the area don't know how they are going to pay it.
''They (the governments) should have set up operating funding sources first before they started construction,'' he says. ''They should have charged franchise fees to developers who will be making money because their developments are served by Metro.''
The Washington Metro has created $2 billion in local development, he said, but it has gotten very little back from the people making the money on that development.
''If they (the governments responsible for Washington's Metro) had known beforehand that they were going to have a $500 million operating deficit,'' Stanley says, ''some of these funding sources would have been in place.''
Miami, which opened the first leg of its Metrorail service last May, will be receiving fees from developers who are building along the rail route, he said, but the amount won't be enough.
Miami also decided to build the system first and then go to the voters to ask for the money to make up the deficit, he said, and that's not the way it should be done.
Now that the Metrorail is attracting far fewer riders than had been anticipated, he says, the government may have trouble convincing taxpayers to pick up the system's deficit.
''Local governments should be up front with the voters and the taxpayers about what the costs of a rail system are going to be,'' he says.
He adds that Houston is moving in the right direction because the city initiated a sales tax, with revenues dedicated to mass transit.
Houston already has raised a couple of hundred million dollars through the tax.
Too many local governments are looking for mass-transit money in Washington because they need a way to generate more jobs, Stanley says.
But the federal government should not be paying for mass transit for downtown redevelopment or for creating jobs, he says - that money should be just for relieving transportation problems.
''Detroit has a plan to revitalize its downtown with a mass-transit system,'' Stanley says, ''but we're skeptical of that.''
Governments should look more toward other sources than the federal government for mass-transit construction, he says.
He points to San Diego as an example, saying that it was able to build a rail system without federal money which was cheaper per mile than a system in Portland, Ore., which was built with federal money.
Cooperation between private companies and local governments could be more effective in getting a rail system built than total dependence on federal money, he says.
Congress is pushing his agency to provide down payments for 10 to 12 new commuter rail systems nationwide, Stanley says. But if UMTA did that, he adds, it would not have enough money to complete all those systems.
''The great irony is that Congress accepted the need for criteria in deciding who would get this money,'' he says. ''But when that criteria stopped some of the proposed projects, Congress called for hearings on the criteria.''