Public Transportation:

Future Demand Is Likely for New Starts and Small Starts Programs, but Improvements Needed to the Small Starts Application Process

GAO-07-917: Published: Jul 27, 2007. Publicly Released: Jul 27, 2007.

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Through the New Starts program, the Federal Transit Administration (FTA) identifies and recommends new fixed-guideway transit projects for funding. The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) created a separate program, commonly called Small Starts, which is intended to offer a streamlined evaluation and rating process for smaller-scale transit projects. FTA subsequently introduced a separate eligibility category within the Small Starts program for "Very Small Starts" projects. These are simple, low-risk projects that qualify for a simplified evaluation and rating process. SAFETEA-LU requires GAO to annually review FTA's New Starts process. This report presents information on (1) FTA's fiscal year 2008 funding recommendations, (2) the extent to which the New Starts pipeline has changed over time, and (3) future projected trends for the New Starts and Small Starts pipelines. To address these objectives, GAO surveyed 215 project sponsors--78 percent of which responded--and interviewed FTA officials, 15 project sponsors, and 3 industry groups.

For the fiscal year 2008 evaluation cycle, FTA recommended to Congress 10 New Starts and 4 Small Starts projects for funding. The administration's budget request of $1.40 billion is primarily allocated to New Starts projects with existing and pending full funding grant agreements. SAFETEA-LU made several changes to the New Starts evaluation and rating process, which FTA is implementing. Since the fiscal year 2001 evaluation and rating cycle, the New Starts pipeline--that is, projects in the preliminary engineering and final design phases--has changed in size and composition, responding to a variety of factors. The number of projects in the New Starts pipeline has decreased by more than one-half, and the types of projects in the pipeline have changed, with bus rapid transit replacing commuter or light rail as the most common type of project. FTA officials attributed the decrease in the number of projects to FTA's increased scrutiny of applications to help ensure that only the strongest projects enter the pipeline, and to FTA's efforts to remove projects from the pipeline that were not advancing or did not adequately address identified problems. Project sponsors that GAO interviewed cited other reasons for the pipeline's decrease, including the complexity, lengthiness, and cost of the New Starts process. The lengthy nature of the New Starts process is due, in part, to the rigorous and systematic evaluation and rating process established by law--which GAO has previously noted could serve as a model for other programs. Other reasons cited by project sponsors for the decrease in the pipeline include finding alternative sources of funding or opting not to apply because they realize their projects are unlikely to receive funding. FTA is considering different ideas on how to improve the New Starts process, some of which may address the concerns identified by project sponsors. Despite these concerns, GAO's survey of project sponsors indicated future demand for New Starts funding. Project sponsors reported having 141 planned New Starts, Small Starts, and Very Small Starts projects and will likely seek New Starts funding for almost three-fourths of these projects. Of these planned projects, project sponsors indicated that they intend to seek New Starts funding for 57 New Starts projects, 30 Small Starts projects, and 14 Very Small Starts projects. Project sponsors GAO surveyed also reported considering a range of alternative project types in their planning. Although project sponsors expressed appreciation for the creation of the Small Starts program, noting it filled a funding gap, they said the Small Starts application process is not tailored to the Small Starts program and is time-consuming, costly, and duplicative. GAO also found that the application is not always tailored for Small Starts applicants and, in several instances, requests duplicative information. FTA officials acknowledged that the Small Starts application process could be further streamlined, and they are working to decrease the burden.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In response to our recommendation, FTA held two sessions on the Small Starts program this year, including one in Pittsburgh on April 22 and one in Phoenix one May 12, which were attended by a total of 120 individuals. As a result, project sponsors are better informed about the requirements for applying to both programs, potentially resulting in more complete applications and a more efficient evaluation process.

    Recommendation: To increase awareness and information sharing about the Small Starts, including Very Small Starts, application process, FTA should conduct training (in-person, Web-based, or both) for potential applicants and facilitate the development of a working group or community of practice.

    Agency Affected: Department of Transportation: Federal Transit Administration

  2. Status: Closed - Implemented

    Comments: In response to our recommendation, FTA clarified Small Starts eligibility requirements in its 2007 Reporting Guidance. In addition, FTA proposed making the eligibility requirements for Small Starts projects more flexible in this year's Reporting Guidance, which was issued in April 2008.

    Recommendation: To ensure that project sponsors better understand the types of corridor bus projects that are eligible for Small Starts funding, FTA should clarify in its Small Starts program guidance that bus rapid transit projects cannot already include any of the required elements for eligibility, or if they do, must demonstrate the cost-effectiveness of the preexisting elements.

    Agency Affected: Department of Transportation: Federal Transit Administration

  3. Status: Closed - Implemented

    Comments: In response to our recommendation, FTA reduced duplicative reporting requirements in the 2007 Reporting Instructions and Templates. Furthermore, some reporting templates were reduced, shortened, or simplified. In addition, FTA identified a simplified alternatives analysis process for Small Starts and Very Small Starts projects in the 2007 Interim Small Starts Guidance.

    Recommendation: To ensure that the Small Starts program provides a streamlined application process as envisioned by SAFETEA-LU, FTA should continue to refine this process as outlined in the Small Starts program guidance. Examples of refinements include collapsing the project finance or cost worksheets to minimize the duplication of data to be submitted and providing specific guidance on how, when applicable, Small Starts applicants can conduct a simplified alternatives analysis.

    Agency Affected: Department of Transportation: Federal Transit Administration

 

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