Highway Demonstration Projects:

Improved Selection and Funding Controls Are Needed

RCED-91-146: Published: May 28, 1991. Publicly Released: Jun 27, 1991.

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Pursuant to a congressional request, GAO evaluated 66 Surface Transportation and Uniform Relocation and Assistance Act of 1987 (STURRA) demonstration projects in 8 states, focusing on: (1) their relationship to state and regional transportation plans; (2) progress and problems encountered in implementing such projects; (3) their estimated costs and impact on other highway project funding; and (4) options for consideration if Congress includes demonstration projects in the 1991 federal-aid highway program reauthorization.

GAO found that: (1) the demonstration projects generally did not respond to states' and regions' most critical federal-aid highway needs and were generally not included in state or regional transportation plans; (2) although $549 million were authorized for the 66 projects, only $198 million were obligated by 1991; (3) some of the unobligated funds may never be used due to the need for preliminary project development work, and provisions for recapturing or redirecting the funds; (4) funds needed to complete the 66 projects exceeded the federal authorized funds and the anticipated state matching funds; (5) reasons for funding shortfall included unreliable cost estimates, inflation, and the fact that federal funds were never intended to cover the complete cost for 23 projects; and (6) if states had received 1987 demonstration project funds on the basis of their percentage share of federal aid highway program allocations, 35 states would have received an equal or greater share of highway funds.

Matters for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: When Congress reauthorized surface transportation programs, it provided for highway demonstration projects, but did not adopt any requirements to improve and control selection of such projects.

    Matter: In the future, if Congress funds highway demonstration projects, it may wish to consider adopting certain requirements, or a combination of requirements, to improve and control selection, such as: (1) limiting project selection to projects already incorporated into transportation plans; (2) restricting demonstration project selection to projects on a federal-aid highway system; (3) eliminating the authorization of specific funds for demonstration projects but permitting specific projects to be funded from federal-aid highway programs; (4) imposing an overall funding cap for such projects; (5) allocating demonstration funds in line with a state's share of total federal-aid highway funds in line with a state's share of total federal-aid highway funds, and (6) reducing the federal share for demonstration projects.

  2. Status: Closed - Not Implemented

    Comments: When surface transportation programs were reauthorized in 1991, Congress did not cancel or redirect federal funds for demonstration projects that have remained inactive 4 years after their authorization.

    Matter: Congress should provide for the cancellation or redirection of federal funds for any existing or future demonstration projects that remain inactive 4 years after their authorization.


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