Drew Kerr of Finance and Commerce describes the new changes that are occurring in the Federal Transit Funding process in his article Funding changes may speed transit projects, which is found, unfortunately, behind a paywall. I get quoted:
David Levinson, a transportation engineer with the University of Minnesota’s Center for Transportation Studies, said studying alternatives is valuable but that preferred outcomes aren’t typically impacted by such studies.
“If you already know what you’re going to do, than the analysis is needless and there really is no point in doing it,” he said.
I am not integrally involved this process (fortunately), I only know what I read in the papers (and on blogs)). A key point to me seemed to be that they made it optional to consider alternative modes (e.g. LRT vs. BRT). Benefit/Cost Analysis is not required (nor was it before).
Travel time improvements would still be considered in that time savings would drive the number of passengers using the line. Similarly for quality improvements in principle.
Some debate on this is at the Wall Street Journal and Reconnecting America.
The rule itself is quite long, the press release is readable. The key points below, my comments in italics.
- FTA is adopting a simpler, more straightforward approach for measuring a proposed project’s cost-effectiveness. FTA will no longer require communities to compare a proposed project’s travel time savings against a hypothetical alternative project. Instead, FTA will look at the estimated cost to construct the project communities intend to build compared against a rigorously analyzed estimate for the number of passengers the project will serve.
It looks like they are using cost-per-trip as their metric, but of course, not all trips are equal, and this new rule would seem to favor projects serving more short trips rather than fewer long trips (not necessarily a bad thing, but a thing).
- FTA is expanding the range of environmental benefits used to evaluate proposed projects. In addition to taking into account the Environmental Protection Agency’s regional air quality designations, FTA will also look at the dollar value of the anticipated benefits to human health, energy use, air quality (such as changes in total greenhouse gas emissions and other pollutants) and safety (such as reductions in accidents and fatalities).
This seems a good thing
- FTA is adding new economic development factors to its ratings process. FTA currently looks at local plans and policies already in place to encourage economic development and how well they’re working in a given area. Going forward, a broader set of economic impacts will be included, such as whether local plans and policies maintain or increase affordable housing.
I am in general skeptical of our ability to accurately measure, much less forecast, economic development benefits . I do not understand why the decisions of non-transportation agencies (like affordable housing programs) have any bearing on whether to construct a mobility improvement whose main effect if any will be to locally increase the price of land (as accessibility benefits are captured by real estate). I am sure this has to do with the administration’s Livability Initiative. However the point should be riders.
- FTA is streamlining the project evaluation process by reducing regulations and red tape. FTA will allow project sponsors to forgo a detailed analysis of benefits that are unnecessary to justify a project. For example, projects that receive a sufficient rating on benefits calculations will not be required to do an analysis to forecast benefits out to some future year. Similarly, FTA is developing methods that can be used to estimate benefits using simple approaches.
Reducing regulations that were designed to mimic an idealized rational planning process but in the end were just make-work for agency staff and consultants in politically driven processes will save money, but is a defeat for rationalism.
The rule appears to weight all objectives equally, so cost-effectiveness is only one of several criteria here. Another point, assuming FTA objectively applies its rules (i.e. there is no political interference), then this ranking may produce different outcomes than the old ranking system. Projects “on the bubble” before, might not make it here, and near misses before might make it with this system.
Nevertheless, the whole system is still affected by federal subsidies for capital (not operating) costs, pushing local governments to capital intensive projects. See Chen, Wenling (2007) Analysis of Rail Transit Project Selection Bias With an Incentive Approach Planning Theory March 2007 vol. 6 no. 1 69-94.
There is also not a good rationale for federal funding in the first place, since the projects are each individually locally geared (there won’t be much interstate travel on the Central Corridor LRT, e.g.), but federalism is a much larger topic, and given the game, the policy change is probably an improvement.