Congress DOT Finance

Considering the Economic Stimulus

House, Senate expected to vote on stimulus package over the next few days; Should we be content about transit’s share in the bill?

Yesterday, the Congress’ Conference Committee finally came forward with its compromise stimulus legislation, which we detailed in the previous post. The final bill came as a bit of a shocker, as it substantially increased the amount of funds to be dedicated to intercity rail, from $1.1 billion in the House bill and $3.1 billion in the Senate bill to $9.3 billion in the final bill, which will be considered today by the House and Monday by the Senate. More evident in the blogosphere, however, was the negative reaction over the bill’s reduction in aid to transit, from $12 billion in the House bill to only $8.4 billion in the compromise legislation for formula grants, the New Start and Small Start programs, and fixed guideways modernization.

As a big proponent of transit, I too was dismayed by the compromise, which drained public transportation of necessary funds. It was especially discouraging to see this compromise after the fight that led to Representative Jerrold Nadler (D-NY) successfully proposing a $3 billion transit amendment to the House bill. We need more funding for our transit systems so that they can stave off fare increases and service reductions, and so that they can keep their rolling stock and guideways in a state of good repair.

And yet, I can’t help but feel satisfied by this bill. While almost every other program in the stimulus package was being gutted by moderates on both sides of the aisle, transit retained its funding as compared to the Senate’s proposal and rail substantially increased its share over both the House and Senate versions. In the chart below, comparing the stimulus bill to fiscal year 2008 appropriations to transportation programs, it is evident that the big loser in the stimulus bill was the highway program, not transit. Though roads make up 60% of the stimulus’ land transportation component, they made up 78% of the 2008 budget. Rail programs zoomed up from 2% of that budget to 21% of the stimulus, and transit roughly maintained its relative importance in funding.

What we see in the stimulus bill, then, is a manifest change in funding priorities, increasing the share of sustainable transportation from 22% to 40%. This is a significant improvement.

It is also reasonable to see the stimulus bill as making up for years of neglect. After all, the Bush Administration has repeatedly threatened to cut off funding for Amtrak entirely and only in last year’s Congressional session did the agency finally get a strong and sustained funding guarantee on the order of $2.5 billion a year over the next ten years. On the other hand, the Bush Administration, though it hasn’t exactly been transit’s best friend, also hasn’t cut off funding for the Federal Transit Administration, which has maintained its relative share of federal transportation dollars since the Clinton Administration.

So the stimulus bill fills an important gap, funding rail to a degree that has never before been accomplished in the United States. It also does not sacrifice transit for the sake of rail, instead decreasing the funding share of highways, a good move. Though we should grieve the inability of transit advocates to secure more funds from the bill, we shouldn’t despair, because the roads lobby was hit directly here. More importantly, though, rail deserves this big infusion of money, as Amtrak and high-speed rail programs should play an important role in the future of mobility in our country. It looks like Congress and the Obama Administration are taking their first big steps towards making such surface transportation improvements a reality.

Comparing the stimulus bill with transportation appropriations in FY 2008
FY 2008 Stimulus Bill
Program Appropriation
% of total Appropriation % of total
Highways $37 b 78% $27.5 b 60%
Amtrak/Rail $1 b 2% $9.3 b 21%
Transit $9.5 b 20% $8.4 b 19%
Total Roads $37 b
78% $27.5 b
Total Rail/Transit $10.5 b
22% $17.7 b

The discretionary funds in the amount of $1.5 billion are not included in the table above (the stimulus component) because they may be directed to transit, rail, or highways.

12 replies on “Considering the Economic Stimulus”

I’m with you on this one. I wish transit got more. Sure I do.

But I am thrilled that rail is getting what it is and that the highway portion has finally started to level out. To me this is all good news.

Any word on how the HSR money will be spent? I imagine a good chunk will go to CA since their plan is furthest along, but beyond that will the money be allocated now or wait for the final proposals for Mica’s bill?

Avi –
I should have mentioned in the post – the HSR money doesn’t have to be spent until 2012. This means that it may not fulfill the instant economic stimulus idea behind the bill, but it also means that this money can be distributed for longer-term projects, even for some that aren’t shovel-in-the-ground ready yet. But I’ll be covering the money distribution as it occurs (most of it should be over the next 90 days).

I’m a transit superfreak, and I think this is a win. Considering we just got a major round of transportation funding done in the US and 40% is not highway-focused, this is a BIG win.

I’m hoping everybody who was active on this coalesces now to focus on the reauthorization bill, and sets an ambitious target, which should be something like this on the funding split:

50% transit/rail/bike ped expansion/modernization/development

40% road maintenance/ITS/no widening “improvements” unless for safety

10% roadway expansion

Look, road expansion is still getting more than transit, so we’re not quite where we want to be.

But, you know, baby steps. This is a considerable improvement over what would have been done with the last Congress and President.

Now, as Patrick M says above, it’s time for transit advocates across the country to get together and push a truly progressive transpo bill this fall.

It’s clear that we at least have a seat at the table here. That’s more than we’ve been able to say in…how long, exactly? Ever?

Think about the deep-set cultural and institutional biases working against us. I think sometimes transit advocates forget how truly backwards this country is in terms of transit and sustainability. In that context, I don’t see how anyone can look at this as anything but a win for transit and transit advocates.

Now, let’s keep our noses to the grindstone, their feet to the fire, and whatever other cliches you care to dredge up. :-)

-Chris, Baltimore

Hey, we’re not going to be up to the level of spending that China is unless there is a large national groundswell for rail. So in the meantime I’ll be happy with the incremental improvements. Just remember, there are many other chances in the near future to allocate more money to transit.

Agreeing with Patrick M and Chris above; this is a definite win, and the next effort is pushing for transit-heavy budget & appropriation bills.

My personal preference is to pick up on the Midwest HSR Initiative, the Richmond-Charlotte route, and the Keystone Corridor, as these all start building and tying together an east-of-the-Mississippi HSR grid.

Which is not to say that the CA initiative should be set aside; just that the bond issue there has already been passed, which starts putting that a bit ahead of the others in terms of progress.

Its always the “next” bill when we are going to straighten out the failure to adequately fund transit. And when the time for the next bill arrives we are stuck not with “deep-set cultural and institutional biases” but with the political math of Federalism. Transit is a locally based political-economy and our national and state political structures take political power from the localities to the exurbs and frontier. That is where the sprawl comes from as much as anything else. There is a deep transit budget crisis throughout this country and this bill avoided the opportunity of addressing part of it.

The theory here is that the voters will so love the HSR projects that they will jump on the bandwagon for their local commuter rail, trolley or bus initiative. All of these systems need funds to operate. The consistent avoidance for the last fifteen years of Federal Operating funding of existing systems with existing riders (mostly poor people) and in this case the willingness to invest in a new speculative system (mostly for the wealthy) is what the big take-away is from this bill.

Norman you state:
“The theory here is that the voters will so love the HSR projects that they will jump on the bandwagon for their local commuter rail, trolley or bus initiative.”

Well yes, and the history of every High Speed Rail line in the world, in over ten countries, is that happens. The lines always make money operationally (sometimes, not always, they even pay off construction cost) and have inspired many cities/regions to install trams, light rail, even metros/subways to access the downtown stations.

How is this a bad thing? Your comments here imply that actually building HSR is a waste of money or a distraction.

Should Transit only be crappy buses reserved for the poor?

Nathan – we’ve got the stimulus bill we’ve got, and there’s nothing we can really do to change that. Again, there’s the DoT budget and appropriations coming up later in the year, and another chance to achieve what we want to.

And, given what we’ve seen in the 111th Congress and out of the current Administration, I’m cautiously optimistic that we’ll see something of worth. The important thing to do is to pressure your representatives in Congress to do more, after welcoming what they’ve done already (killing with kindness is appropriate here).

Draw whatever implication you want from what I say. I’m not trying to imply anything I’m trying to state reasons and facts. Perhaps I’m not being clear enough.

What you state to be the universal worldwide historical experience is not determinative in our specific context. Particularly, the near total absence of fuel taxes in the US both to fund rail systems and to create a competitive market vis a vis automobiles is absent. And, in our particular transportation market, since the land use and population density structure badly disadvantages mass transit in general and rail in particular, our transit market is in need of even greater operating funds and cost equalization with the private automobile travel market.

All of the systems you cite are typified by enormous fuel taxes by our standards, in some cases higher than the total we pay for fuel. Those taxes are used to capitalize and operate transit, trolleys, buses and high speed intercity rail. Complementing the funding of the mass transit system is a competitive advantage against private automobiles (and airlines) simply because fuel prices are so high.

Don’t get me wrong, I favor high speed rail and want it to succeed but do not feel it is given sufficient breathing space here to do so. In the end I view the interface and intermodality character of the system to be one critical leg on a three legged stool needed for success. Only one leg though. And in this case that leg is weak, fractured really, because of the present transit funding crisis. That crisis dooms the new start high speed rail system to failure.

There are still two other legs though that also radically distinguish our environment from the European examples. First is political. These are for the most part Parliamentary Democracies that do not devalue urban density politically in the way that our Federalist system does. The only way to establish the political center of gravity to push high speed rail (and AMTRAK) through the Congress is to make it run in enough locations that the legislation will pass through the House and Senate.

Parliamentary systems with independent regional centers built according to the dictates of thousand year old cities create the political force to, nearly universally, deny the establishment of politically autonomous suburban cities surrounding them. That is not the case here. In the US, the opposite is true. Just as nearly universally our metropolitan areas are distinguished by politically castrated urban center entirely ringed by property value harvesting suburban political machines.

Finally, there is the utter auto-dependency of our culture and economy, a hegemony that has been diminished incrementally though slowly. There is a substantial class divide in this auto-dependent culture with many poor people, in locations with no mass transit, spending more on their cars than they do on their homes, cars they need to get to their jobs.

Mass transit systems have been fighting the battle to establish the third and fourth legs to varying degrees of success. What was a battle last summer is now more like a suicide mission since the economic meltdown.

These are my views, not my implications. Correct me if I’m wrong, and I’m hope you will, but your view is that our citizens just haven’t seen what good high speed rail is and that after they do they will climb aboard despite living in exurban one acre lots with three car garages and consistently vote for politicians that pledge our economic resources to high speed rail. Apparently then this model of modern transportation will be so attractive that the high speed rail passengers, so invigorated, will be willing to share their economic and political resources with our starved transit systems and AMTRAK and we will all be saved.

By then with the present vector of events there will be no bus systems, and only very debilitated transit and commuter rail systems. This will have the effect though of erasing the welfare character of mass transit, getting the poor people off the system and into the used cars.

Apparently, this is really an $8 Billion marketing test, sort of a focus group writ large. In the meantime, our functioning, over-burdened existing systems will have the tin-cup out. Please give generously.

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