FAST Act Makes Slow Progress

The sausage has been made and the federal transportation bill has emerged from the conference committee with a treacly new name: Fixing America’s Surface Transportation Act (“FAST”). “Fixing” is much too ambitious of a word for a 5-year, $305 billion bill. Maybe “hot-gluing”, but fixing America’s rickety infrastructure in five years with so little money? I think not. The vast majority of the bill is business as usual, continuing the quixotic quest to build enough highway lane miles to somehow keep America’s gigantic fleet of cars in constant motion — all without raising the fuel tax from its 1993 level. That said, the sausage was sprinkled with a few nutritious nuggets.

• Transit funding got a 18 percent boost (compared to 15 percent boost for highway spending). There was some fear Republicans would use their muscle in each chamber to shrink transit’s share from of funding from one-fifth, at which it has generally stood since the 1980s, but the share actually increase ever so slightly.
• The New Starts program survives for funding transit projects, although at a 60 percent federal match, down from 80 percent.
• The Small Starts program remains intact. Mostly used for bus projects, the program maintained a 80 percent federal match.
• TIFIA financing program was made more available to smaller cities by lowering the threshold from $50 million to $10 million. The program, which offers loans to local governments at favorable rates, should help small cities expand their transit networks and perhaps improve their public realm. However, overall TIFIA funding took a big hit shrinking from $1 billion to about $250 million. And big cities still have an advantage because their larger staffs can process applications faster, Eric Jaffe argues.
• Bicycle and pedestrian infrastructure funding was preserved and will actually increase slightly from $834 million per year to $850 million per year by 2019. Not bad considering legislators had to beat back three amendments attempting strip bicycle funding from the bill.
• Local governments were given more autonomy from their state departments of transportation (DOTs). In metros with more than than 200,000 residents, local leaders get to control a portion of their federal money rather than having to go through the car-happy need-for-speed crowd at the state DOT to get it. It should be noted, though, that the federal money doesn’t amount to much in the annual budgets of most metropolitan transit agencies.
• Liberates cities from imbecilic highway design manuals incompatible with good pedestrian design. Ironically, pedestrian advocates hope to use the FAST act to slow motorists down to increase pedestrian safety and comfort. In his write-up of the bill, Eric Jaffe laid out how FAST will allow cities to build narrower, safer streets without interference from the state: “Moving forward, for federally funded projects where city officials are taking the lead, planners will be able to use a street manual that differs from the state’s official road design publication, provided that manual is approved by the Federal Highway Administration.” He further writes, “This theoretically frees cities from the conventions of car-first street standards and lets them design streets more friendly to bikes, pedestrians, and transit users—such as the celebrated Urban Street Design Guide put out by the National Association of City Transportation Officials.”
• Strangely, the transportation bill also includes provisions for affordable housing and promoting energy efficient buildings. Deron Lovaas spotted this tasty but unexpected morsel “Tucked waaay back at the end of the bill, remarkably, in a tribute to affordable housing lobbyists there are several non-transportation sections covering low-income housing, including apartment buildings which receive assistance from the Department of Housing and Urban Development (HUD).” Lovaas also highlighted a pilot program for a public-private partnership funding more energy efficient housing.
• A small opening for an enterprising state to toll existing interstate lanes. Despite continuing the tolling prohibitions on existing interstate lanes, the FAST Act preserved a little known pilot program dating back to 1998 that grants an exemption to three states allowing them to toll their interstates. It’s not well known because the three states occupying the program’s slots — Virginia, North Carolina, and Missouri — have neglected to implement it. The new language would kick those states out of the slots in three years if they fail to actually start tolling. Another state could then slide into an open slot. If Washington state was feeling adventurous, it could seek a slot and set up congestion pricing in the Seattle metro to reduce congestion at rush hour, to discourage people from driving to work downtown, and to raise revenue it a way that discourages greenhouse emissions.
• Finally, the cowardice of legislators in using general taxpayer funds rather than increasing user fees strengthens the case for transit funding. Motorists frequently complain that the gas tax is used to fund transit instead of highways. However, the gas tax was not sufficient to pay for the $305 billion bill. The FAST act has a $70 billion funding hole that will be filled in a variety of other ways: $53.3 billion from a Federal Reserve bank surplus, nearly $7 billion from reduced bank dividends, $6.2 billion from the sale of oil reserves, $5.2 billion or so from customs fees, and $2.4 billion from a new tax collection scheme, according to The Hill. Congress has come to rely on general funds to finance the transportation bill, empowering transit, bicycle and bicycle advocates to come for their rightful share. So get ready for that argument in five years time when we hot glue this thing all over again.
• Amtrak’s Northeast Corridor finds firmer financial footing. The bill gives heavily traveled Northeast Corridor $2.6 billion over the five year bill while National Network gets $5.5 billion. “The new arrangement should make it easier for Amtrak to focus investments on the heavily traveled Washington-to-Boston-via-New York corridor instead of using that profitable region to subsidize money-losing (but Congressionally mandated) routes in other parts of the country. Passengers at Union Station in D.C. and Penn Station in New York might especially benefit, as the FAST act calls for Amtrak to consider revising its inefficient boarding procedure, whereby passengers crowd at the gates instead of spreading out along an entire platform,” Jaffe explained.

There was also some not so nutritious additions to the sausage:

• TIGER grants got axed, eliminating a valuable funding source for transit projects including projects too big for the Small Starts program.
• Lots of carbon from trucking. The bill’s focus on freight trucking rather than freight rail ignores trucking’s big carbon problem. “In the U.S., the big concern may be freight; indeed, trucks alone account for 12.5 percent of total U.S. carbon emissions,” Yonah Freemark writes. “Though mechanisms to reduce freight emissions exist—shifting shipping to rail, for example, would significantly limit the rise in pollution—FAST will dig the hole deeper. The legislation includes a massive new freight program that is almost exclusively dedicated to the movement of traditional, highway-based, diesel-polluting trucks.”
• Lots of carbon from continued highway expansion. The fact that highway spending went up 15 percent makes it easier for state DOTs to continue their never-ending asphalt ecological death march into exurbia. Some fiscal conservatives, sprawl opponents, and environmental advocates pushed a”fix it first” maintenance-focused policy. That did not happen. Highway construction emits a massive amount of carbon; the new highways then induces even more driving, spewing even more carbon. We failed to break out of this toxic cycle.
• Big commercial banks succeeded in buying Congress on yet another bill. Banks totally lobbied their way out of taking a $17 billion hit to their bottom line via lower dividends from the Federal Reserve Bank, which the Senate version had proposed. The House version raided the Fed’s rainy day surplus instead. In conference committee, the House mostly got its way. Just $7 billion will come from lower bank dividends. Definitely worth those lobbyist checks!