In the Race for Vibrancy, Transit Investment is a Must

December 16, 2013

by Leslie Wollack

Cities are in a race for relevancy, a race for vibrancy, NLC President Chris Coleman, mayor, St. Paul, Minn., told a House of Representatives panel last week. In his testimony before the House Transportation and Infrastructure Services Subcommittee on Highways and Transit, Mayor Coleman stressed the need for comprehensive transportation networks in order for cities to attract a dynamic workforce and remain economically viable.

Citing the value of transit investment for long-term economic impact and the ability to generate future economic returns, Mayor Coleman urged Congress to continue funding the Federal Transit Administration’s New Starts and Small Starts transit programs. Mayor Coleman emphasized the importance of this local-federal partnership that allows cities to invest in transit and the intermodal transportation networks that link cities to each other and to regional hubs.  

“Few local communities have the capacity to bond or tax for the full cost of construction.  Through the New Starts program, the federal government has proven to be an effective partner in expanding transit services and underwriting economic growth,” noted Coleman. “While demand is growing nationally for New Starts funding, the program faces threats in Congress.   Unlike most other federal transportation programs that are funded by the gas tax, New Starts is paid for with general funds and is subject to sequestration and yearly budget cuts.”

Mayor Coleman highlighted the value of New Starts funding for the Central Corridor light rail transit project, which when complete will link downtown Saint Paul with the University of Minnesota and downtown Minneapolis.  With six months to go before the opening of the Central Corridor route, this project has already generated more than $1.2 billion in new housing investments and employment opportunities within the 18 station area along the 11-mile route. 

St. Paul is not alone in experiencing this kind of transit-anticipation investment. Salt Lake City, home to NLC 1st Vice President Mayor Ralph Becker, has a similar story with the city’s brand new streetcar, which generated $400 million in private investments before it opened last week.

What is New Starts?

The Federal Transit Administration’s (FTA) New Starts Program provides grants for large projects that cannot traditionally be funded from a transit agency’s annual formula funding. This program, which is among the oldest categories of federal capital transit grants, has facilitated the creation of dozens of new or extended public transportation systems across the country. These grants are generally eligible for a maximum 80 percent federal share of the net project cost, although most receive no more than 50 percent.   

While some view the New Starts and federal transit programs as an urban program, FTA Administrator Peter Rogoff noted that federal transit funds support suburban, exurban and rural systems as well.  Further budget cuts would hurt all these systems, he said.

Shortly after Congress returns in January, it will begin in earnest the debate on transportation funding, as the current program expires in September 2014.  Join your colleagues at NLC and be part of the discussion. Let your elected representatives know how crucial these federal investments are in your community.  

Video, testimony and other background materials from the hearing can be found here.  For more information on NLC’s transportation policy and transportation resources, click here.