An oft-repeated refrain during debates over the bill was the need to provide flexibility to states to fund their most critical needs. However, this did not happen. Many of the provisions that would have provided increased flexibility were eliminated, such as the ability of states to invest in freight rail or local street networks. Provisions that would have provided local communities with the flexibility to use federal dollars to avoid cutting transit service and keep buses running during tough economic times were also eliminated. The perverse result is that communities will have the funds to buy new buses, but won’t have the money to pay someone to drive it.
The bill mandates that states spend nearly 60 percent of all funds on the largest highways, those in the National Highway System, leaving a heavier burden for the states and localities that maintain other critical links in the system. The most flexible pot of money – the Surface Transportation Program (STP) – now is responsible for covering more projects, but without a commensurate increase in funding. So while states will be able to use $10 billion to address a broad range of activities, they actually had more money and more flexibility under the previous bill.
4. Less money, but more local control, to make streets safer for all users
The bill eliminates the popular Transportation Enhancements, Safe Routes to School, and Recreational Trails programs and creates a new set-aside called Transportation Alternatives. While those three earlier programs totaled roughly $1.2 billion per year, MAP-21 cuts funding for the consolidated Transportation Alternatives by a third, to $808 million. There is some good news: 50 percent of that sum is allocated directly to larger metropolitan areas and other areas of the state with the capacity to plan and implement projects.
However, under a change made in conference, states can now transfer the other half to any other program. Under the bipartisan Cardin-Cochran provision passed in the Senate, this money was intended to be made available to smaller local communities via a grant program. If no communities wanted the money for biking and walking projects, as some lawmakers have repeatedly claimed is the case, then the state could spend that money on any other state needs. The change made in conference takes away local control and their local voice, declaring that the state knows better than your local community.
5. Continued funding of transit “New Starts” projects
The New Starts program, which funds almost all new transit construction, is retained and funded at $1.9 billion. Unlike highway funding, New Starts is subject to annual appropriations, just as it is today, and so is not guaranteed. MAP-21 does make several positive changes to the program. It simplifies the approval process and eliminates duplicative requirements. It also allows for “core capacity” projects to receive funding. Those are projects that, rather than building a new line, improve an existing line to move more people. This is becoming increasingly important as many systems across the country have lines at or over capacity.
“Corridor-based bus rapid transit systems” are also now eligible for grants under $75M. These differ from conventional bus rapid transit projects in that they do not need to operate in a dedicated transit right-of-way. This is a mixed development because it introduces a new eligibility that will compete with rail and full-fledged bus rapid transit projects.
6. More capacity to borrow, but less to innovate
While the bill did not reauthorize the popular and over-subscribed TIGER grant program or establish a national infrastructure bank, it does include two expanded national infrastructure programs.
The TIFIA loan program provides low-cost loans – not grants — for highway, transit and intermodal projects that must be repaid. The program, which subsidizes low interest rates and provides federal guarantees, has been expanded from $122 million per year today to $1 billion in FY14, allowing U.S. DOT to support more than $10 billion in loans each year. (The program can support around $10 in loans for each dollar in funding.)