Mass Transit:

Needs Projections Could Better Reflect Future Costs

RCED-93-61: Published: Mar 9, 1993. Publicly Released: Mar 9, 1993.

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Pursuant to a legislative requirement, GAO reviewed transit needs projections by the Federal Transit Administration (FTA) and two transit associations, focusing on: (1) why their transit needs projections varied; (2) other factors affecting future projections' accuracy; and (3) opportunities for improving future transit needs projections.

GAO found that: (1) FTA and the two associations' use of different definitions of transit needs resulted in projections varying from $3 billion to nearly $32 billion annually; (2) unlike the associations, FTA did not include transit systems' largest expense category, operating costs, in its projections, resulting in its greatly underestimating future transit needs; (3) operations cost estimates ranged from $0 to $16.2 billion; (4) each organization included capital expansion in its projections, but each used different approaches to calculate the costs, resulting in estimates of $2 billion to over $5 billion annually for capital expansion costs; (5) all organizations calculated costs for maintaining existing equipment and facilities, but each used different methods to calculate the costs, with some methods underestimating replacement needs; (6) none of the organizations calculated the costs of all transit needs related to transit goals or legislative requirements, partly because some laws had not been enacted at the time the projections were issued; (7) future operation costs could increase for a variety of reasons, but service may be reduced due to a lack of operating funds; and (8) the Department of Transportation (DOT) may be able to collect improved data on future transit investments and system conditions due to legislative requirements that states prepare transportation plans and improvement programs, and the establishment of a Bureau of Transportation Statistics and state transportation management systems.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report, but did not incorporate this recommendation.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by ensuring that standard data requirements for transit needs projections, such as planned transit expansions and transit systems' condition and maintenance information, are included in the new Intermodal Surface Transportation Efficiency Act of 1991 transportation planning and management system regulations that are currently under development.

    Agency Affected: Department of Transportation

  2. Status: Closed - Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report. Specifically, FTA: (1) included in its calculation of replacement needs, the entire human service operator fleet and not just the vehicles DOT had funded; (2) included transit operators' cost estimates for ADA compliance throughout the report and also included the cost to address other federal mandates, such as the Clean Air Act and the Energy Policy Act of 1992; and (3) incorporated projects made at the local level which are more reflective of the potential costs of expanded ridership which would use rail instead of bus transportation. Based on these actions, the FTA's transit needs report reflects more reliable data on which to base major investment decisions.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by developing new needs projection methods that are more reflective of potential costs, such as estimating the proportion of expanded ridership that will use rail versus bus service and projecting costs accordingly, and including costs to address Clean Air Act Amendments of 1990 and the Energy Policy Act of 1992.

    Agency Affected: Department of Transportation

  3. Status: Closed - Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report. Specifically, FTA: (1) included in its calculation of replacement needs, the entire human service operator fleet and not just the vehicles DOT had funded; (2) included transit operators' cost estimates for ADA compliance throughout the report and also included the cost to address other federal mandates, such as the Clean Air Act and the Energy Policy Act of 1992; and (3) incorporated projects made at the local level which are more reflective of the potential costs of expanded ridership which would use rail instead of bus transportation. Based on these actions, the FTA's transit needs report reflects more reliable data on which to base major investment decisions.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by including transit operators' cost estimates for Americans with Disabilities Act compliance as reported to FTA under 49 C.F.R. parts 27, 37, and 38.

    Agency Affected: Department of Transportation

  4. Status: Closed - Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report. Specifically, FTA: (1) included in its calculation of replacement needs, the entire human service operator fleet and not just the vehicles DOT had funded; (2) included transit operators' cost estimates for ADA compliance throughout the report and also included the cost to address other federal mandates, such as the Clean Air Act and the Energy Policy Act of 1992; and (3) incorporated projects made at the local level which are more reflective of the potential costs of expanded ridership which would use rail instead of bus transportation. Based on these actions, the FTA's transit needs report reflects more reliable data on which to base major investment decisions.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by including vehicle replacement needs for the entire human service operator fleet, not just the vehicles DOT has funded.

    Agency Affected: Department of Transportation

  5. Status: Closed - Not Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report, but did not incorporate this recommendation.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by including operating needs (current as well as expanded system) for the nation's transit systems.

    Agency Affected: Department of Transportation

  6. Status: Closed - Not Implemented

    Comments: The joint FHwA/FTA report to Congress on "Highways and Transit Conditions, Needs, and Performance", was issued on October 27, 1995. It incorporated three of GAO's recommendations designed to enhance the needs projections addressed in the report, but did not incorporate this recommendation.

    Recommendation: To better assist Congress and others in the transportation community, the Secretary of Transportation should improve future FTA transit needs reports required by 49 U.S.C. section 308 by considering transit needs data requirements, such as variables that influence the selection of transit over other alternative modes, when determining the Bureau of Transportation Statistics' future activities.

    Agency Affected: Department of Transportation

 

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