The Federal Transit Administration’s New Starts and Small Starts programs support the engineering, design, and construction of rail and bus rapid transit projects around the country. Projects seeking funding from these programs must be evaluated according to a number of criteria specified in law. Over the years, applicants for funding as well as other stakeholders have expressed concern with the onerous nature of the current evaluation process. In response, the Federal Transit Administration recently issued a Notice of Proposed Rulemaking (NPRM) to make a number of changes in the evaluation process for New Starts and Small Starts projects. The FTA’s stated goal is to both streamline the process and to capture in the evaluation a broader set of the benefits which transit projects provide. Reconnecting America has prepared a table summarizing the major changes to the evaluation criteria that FTA is proposing in the NPRM. The NPRM is open for public comment until March 26, 2012.
New Starts NPRM – Project Justification Criteria
March 12, 2012
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Criterion
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Current Evaluation
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Current weight
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Proposed Evaluation
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Proposed weight
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Comments
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Mobility improvements
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Transportation system user benefits (TSUB) per passenger mile on the project, with additional credit for transit-dependent trips
TSUB = measurable change in travel time, compared to a baseline alternative, over a horizon of 20 years, generally referred to as “travel-time savings”
Baseline alternative = the best that can be done without a major capital investment in new infrastructure
Trips are estimated based on local or regional travel forecasting models
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20%
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Total trips on the project, with each trip by a transit-dependent individual counted twice.
No comparison to a baseline is required.
FTA will develop a national model for estimating project trips using census data and actual ridership experience. If a project sponsor chooses, they can estimate trips using local travel forecasting models instead of FTA’s model.
Project sponsors can estimate trips for only the current year, or for the current year and the horizon year (10 years out). If they choose to do both the current year and the horizon year, trips will be based on the weighted (proposed to be 50%/50%) average of current-year and horizon-year.
Travel-dependence will be determined either by household income or by household car ownership
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16.66%
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The current measure’s focus on travel-time savings benefits longer projects, which provide more of an opportunity to save time. The proposed change to number of trips on the project would treat longer and shorter projects equally.
The current requirement for comparison to a baseline alternative requires significant expenditures of time on reaching agreement with FTA on the appropriate baseline. The proposed elimination of the baseline alternative would reduce the amount of time project sponsors would need to spend on the application.
Using a national ridership model and only requiring current year ridership estimates should also reduce time needed in the application process, as FTA will no longer need to review local travel models.
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Environmental benefits
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Projects located in a non-attainment area for air quality receive a “high” rating; project located in an attainment area receive a “medium” rating
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10%
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Quantified by measuring dollar value of changes in:
(1) Air-pollutant emissions, estimated using changes in VMT
(2) Greenhouse gas emissions, estimated using changes in VMT
(3) Transportation energy use (only benefits of reduced reliance on fuel, not emissions-related benefits), estimated using changes in VMT
(4) Safety changes (transportation fatalities, injuries, and property damage) estimated using changes in VMT and transit-passenger miles
compared to the annualized capital and operating cost of the proposed project. Comparison would be to the existing environment in the current year, or at the option of the project sponsor, to the current year and the no-build environment in the horizon year.
FTA will develop a spreadsheet with standard conversion factors to calculate the dollar values of the elements above.
Benefits gained in a non-attainment area would be worth more than benefits gained in an attainment area.
Changes in public health would be considered once better methods for calculating those effects are developed.
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16.66%
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The key changes are to include multiple measures of environmental benefits and to compare them to the cost of the project. This is designed to capture more of the potential benefits of transit projects, and by comparing the benefits to the costs, to get a more useful measure for comparison across different projects.
The focus on VMT change would benefit projects that attract new riders or have longer routes. Projects in transit-dependent areas would likely have less VMT reduction (but could potentially fare better on mobility, cost-effectiveness, and economic development criteria).
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Operating efficiencies
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Change in operations and maintenance cost per passenger mile compared to the existing transit system in the current year, or the baseline transit system in the horizon year.
Passenger mile = number of passengers multiplied by annual revenue miles.
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10%
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Change in operations and maintenance cost per “place-mile” compared to the existing transit system in the current year, or at the sponsor’s option, to both the system in the current year and the no-build transit system (current system plus investments committed in the region’s TIP) in the horizon year.
Place-mile = seated plus standing capacity of vehicles multiplied by annual revenue miles.
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16.66%
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FTA explains this change as intended to focus only on changes in the cost to supply transit service. “Passenger miles” involves the demand side of the equation, and can be affected by deployment decisions and usage patterns.
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Economic development effects
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Qualitative assessment of the transit-supportive plans and policies in place and demonstrated performance and impact of those policies.
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20%
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Qualitative assessment with an optional quantitative measure of likely future development outcomes resulting from the project
Qualitative assessment includes the current factors (existing or anticipated plans and policies to support economic development near the project) and adds consideration of the social equity impacts of projects by examining plans and policies in place to maintain or increase affordable housing in the corridor.
Quantitative measure (at the project sponsor’s option) includes indirect changes in VMT resulting from changes in land use (improved accessibility), with the resulting environmental benefits calculated, monetized, and compared to the annualized capital and operating cost of the project. Quantification would involve examining the economic conditions in the corridor, mechanisms by which the project would improve those conditions, availability of land in station areas for development and redevelopment, and a pro forma assessment of the feasibility of specific development scenarios.
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16.66%
(33.33% for small starts)
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FTA focuses this measure on the likelihood of the project fostering development, rather than attempting to forecast how much development will occur.
FTA staff indicated that they based the quantitative measure of economic development effects on monetized environmental benefits due to the lack of available tools to predict future economic impact in quantifiable terms. They are open to adding measures, e.g., a measure of agglomeration benefits, once such measures are developed.
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Cost effectiveness
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Measured by changes in annualized capital and operating cost of the project per hour of travel time savings, compared to a baseline alternative
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20%
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Incremental cost per trip on the project. Trips would be calculated under mobility benefits. Costs include:
(1) Annualized capital cost of the project, including changes in capital, operating, and maintenance costs compared to the existing system, or at the project sponsor’s option, to the existing system in the current year and the no-build system in the horizon year
Minus the costs of “betterments”
“Betterments” are costs for elements that are not required for mobility but rather foster economic development or environmental benefits, such as the incremental cost of obtaining LEED certifications, station-access improvements beyond what the ADA requires, or station-design and station-access elements that would enhance development impacts.
No comparison to a baseline is needed.
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16.66%
(33.33% for small starts)
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By subtracting “betterments” from the cost side of the equation, FTA proposes to remove a disincentive to include these project elements, which can have a direct effect on the success of the project as a catalyst for economic development. FTA is seeking comments on what types of project elements should be considered betterments.
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Land use
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Existing population and employment density, parking supply, and facilities for pedestrians
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20%
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Similar to current measure, with the addition of the amount of publicly supported housing currently in the corridor
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16.66%
(33.33% for small starts)
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Other factors
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Any factors likely to be relevant to the success of the project
May include multimodal connectivity
Environmental justice considerations and equity issues
Livable Communities initiatives and local economic activities
Policies to locate federal and other major public facilities in proximity to the project
Innovative procurement and construction techniques, including design-build turnkey applications
Additional factors relevant to local and national priorities and to the success of the project
(Small starts also has “opportunities for increased access to employment for low-income persons” as an example)
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Additional points from the NPRM:
- FTA identifies two goals for the NPRM: to measure a wider range of benefits from transit projects and to streamline the New Starts application process
- Streamlining is accomplished by:
- Reducing the need for baseline comparisons
- Allowing the use of warrants (prequalification on specific evaluation criteria based on the characteristics of the project or the project corridor)
- Using national FTA-developed models for ridership and environmental benefits
- FTA has not identified the breakpoints (the score at which a project gets a particular rating) in the NPRM, or the relative weights for
- multiple factors within a single criterion; that will be done in future policy guidance
- For criteria in which benefits are measured on their own (i.e., not compared to cost) a small amount of benefits could still get a
- “medium” rating; only adverse effects would get a lower rating than medium
- Local financial commitment evaluation is modified by combining capital and operating condition into a single factor (currently they are
- considered separately). Overmatch (above 50% local share) raises the rating one level, but sponsors are not penalized for providing
- less than 50% local share.
- Small Starts evaluations differ from New Starts evaluations as follows:
- By statute, project justification is based only on cost effectiveness (at initiation of revenue service), economic development, and transit supportive land use patterns and policies
- Local financial commitment is evaluated at opening year, not on a 20-year horizon
- Expedited financial review is possible for projects where costs are below a certain percentage of the sponsor’s annual budget
- Only 1 phase (project development) before federal funding commitment, rather than 2 for New Starts (preliminary engineering and final design)
- FTA requires project sponsors to report the number of domestic jobs related to design, construction, and operation of the project.
- The NPRM includes the existing requirement for a before and after study. FTA seeks comments on whether two years after opening
- is sufficient time for the “after” study to be meaningful.
