Administrator Rogoff Remarks at APTA Rail Conference, Vancouver, Canada


06-07-10

When I first started—I’ve now been on the job for a year, and in fact the APTA Rail Conference was one of my first public engagements, right after my confirmation last year.

When I first came on, we faced the great challenge of obligating all of our Recovery Act resources in time for the statutory deadline. We succeeded in doing that, and we did it ahead of time, and we did it really through the hard working folks in this room—the transit agencies across America and the hard working FTA staff and in our regions across the country and in our headquarters that stood up to a challenge of obligating an 80 percent spike in federal funding in a single year. We’ve now obligated 100 percent of all of our formula funds.

One out of every three dollars has actually been outlaid from the Treasury.  But even the other two-thirds of the money is already being awarded into contracts, is being used to manufacture vehicles, and is creating and saving jobs throughout the transit industry and our manufacturers, which is the core purpose of the Recovery Act.

I said in my speech last year that how we performed in executing the Recovery Act will be an important precursor and an important statement leading into reauthorization and I have to say I can’t imagine us putting a better foot forward that we have as an industry and an agency in showing that we can get the job done as we have with the Recovery Act. 

FTA as you know saw an 80% spike in funding in a single year—the only other federal agency to see under President Obama’s leadership the kind of funding increase of a percentage that high was our sister agency the Federal Railroad Administration and their high speed rail initiative, another public transportation investment.

So we’ve got a lot to be proud of but we’re not sitting idly by.  We all understand, and please know the FTA understands, that you are facing very difficult and tough economic times. Even with an historic federal funding boost provided through the Recovery Act, these additional federal dollars have not been enough to fully offset the challenge presented by reduced sales and property tax revenues, cuts in municipal support, fare box reductions brought about by unemployment; and rising fuel prices. FTA is mindful of the struggles that you are going through.

And as I’ve told my staff a number of times, we’re going to look at this situation, we’re going to be a player in this situation and we’re going to do it with our eyes open. 

I have to admit one of the things that I’m working on internally is to get FTA’s research function to focus on questions that are more relevant to the here and now—more relevant to the challenges that you all face every day. 

I discovered to my dismay that we actually collect as an agency quite a lot of information about operating expenses, operating challenges and we put it together in a very voluminous report; however, by the time we report the data it’s already over two years old.

I can assure you that President Obama, Ray LaHood and I are much more interested in what’s going on in the here and now and what we are facing in our future than knowing what happened two or three years ago.

I’ve now served with Secretary LaHood for over a year. It’s been a great pleasure, and I can tell you he is the type of Transportation Secretary who wants to deal with facts and not fluff. He wants to deal with the realities of the here and now.  

Just a few weeks ago, Secretary LaHood issued a draft strategic plan for the entire Department of Transportation.  That plan has five clear and explicit strategic goals for the Department. 

In my discussion this morning, I want to focus on just two of them, namely the overarching importance of safety, and our quite related strategic focus on the State of Good Repair.

The State of Good Repair goal in the Secretary’s plan is not just related to transit.  It also applies to highway bridges, to runways, to freight connections, and even to our air traffic control system. 

But in some important respects, I think this State of Good Repair goal calls out to us in a way that must be louder, more urgent, and more compelling than it does to our modal partners.

As many of you know, last year we conducted a study at the request of a number of legislators who asked us to look specifically at the conditions and maintenance backlog of our largest rail operators.  One of the legislators who requested that study was the then-Junior Senator from Illinois, Barack Obama.  So we focused on it. (Laughter.)

The initial report took a look at the seven largest transit systems and concluded that they were facing a staggering state-of-good-repair shortfall of at least $50 billion.  

When I briefed Secretary LaHood on those results, he insisted that we expand the report beyond the seven largest rail operators to the entire national transit network -- fully 690 separate rail and bus systems. 

Well, obviously we weren’t able to survey each and every one of them, but we’ve done some modeling based on a sampling of data, and or study indicates now that the wider universe of transit providers is facing an estimated funding shortfall of $78 billion. 

Please keep in mind that that estimate is not about bringing the assets in the transit industry to a new, pristine condition. For the purposes of this study, assets that are defined as being in a state of good repair are those that are brought to what we called a "marginal" range.  They were brought to a score of 2.5, with a score of 1 reflecting assets in poor condition and a score of 5 reflecting assets that are in excellent condition. 

Indeed, the study revealed that fully 29 percent of all transit asset—almost a third—of rail, bus and paratransit assets—are in poor or marginal condition.

I first revealed these figures publicly during a speech I gave on the State of Good Repair at the Federal Reserve Bank in Boston a few weeks ago. I discuss them today, just as I discussed them in Boston, not to draw some hysterical conclusion that the sky is falling.  The sky is not falling.

Thanks to your skill and professionalism and that of your employees, our rail transit systems continue to provide the safest form of surface transportation available for millions of citizens each and every day. 

In fact, as I said during my speech in Boston, the general managers of our transit systems are truly the unsung miracle workers in the enterprise.  So are their employees.

You’re engaged in a daily, monthly and yearly balancing act.  You’re balancing the service needs of the riding public, the maintenance and capital needs of existing infrastructure, the political enthusiasm for further expansion and the legitimate rights of your workers to earn a decent wage. 

You’re balancing how you use federal capital dollars, whether they’re for true capital investments or whether they’re needed more immediately for preventive maintenance. You perform this balancing act in an economic environment that is truly uncertain.  And you, along with your dedicated employees, still turn out service for millions of citizens each and every morning, evening, and afternoon, and through the night.

It’s precisely because of the challenges presented by this balancing act that you do every day that we all must keep our eyes constantly focused on the state of good repair of our systems.

You know when I gave this speech in Boston, Focusing on the State of Good Repair,” I was critiqued by some out in the blogosphere. It raised a lot of questions. For one thing, I learned not everyone in the blogosphere reads an entire speech. (Laughter.)

But importantly, part of that critique stemmed from the fact that focusing on the state-of-good-repair backlog numbers that some of our communities that consider rail systems might more readily and more effectively consider bus rapid transit systems. I was looking not just at the cost differential of deploying those systems now, but the repair, restoration and eventual capital replacement costs of restoring those systems during the next generation. I was accused of being anti-rail, and that FTA was turning its back on rail investment.   It was interesting to read, given the fact that I’d spent most of that week trying to move a $5.5 billion rail project forward in Honolulu and a $9 billion to $10 billion rail tunnel under the Hudson River forward between New Jersey and New York.  A critical part of the President’s agenda for high-speed rail includes the rail links that will feed that system, as well as bus links. 

As we’ve said repeatedly, the President’s vision for high speed rail does not include 50 decks of parking at each rail stop.

So please know that we are not abandoning new investment, and to be concerned about the state of good repair must not mean a choice between state of good repair and investment. The fact, is we need both.

As I’ve said many times, growing the universe of transit riders is at the very center of President Obama’s goals to reduce our dependence on oil and make meaningful cuts in greenhouse gas emissions.  But we run the very real risk of slowing our progress, if we stay focused just on expanding service to new communities.  One simple truth that we all know and we all must face:  if we ignore deteriorating conditions in our existing transit systems, we run the very real risk of losing riders. Discomfort, inefficiency, unreliability and worries about safety drive people away.

Ironically, every study ever conducted will show that from a safety perspective, passengers are far safer riding our most fragile systems than driving the highway.  But that doesn't necessarily influence the choices that commuters make.

And then, there is the fact that some riders don't have a choice.  They don't own a car—most can't afford one—and they are completely dependent on the transit system to get to work, to shopping, to school, to day care.

What does deteriorating transit conditions mean to them? It means risking the loss of a job because they can't get to work on time. 

It means risking their spot at the day care center because they can't pick their kid up on time.

For some parents, reliable transit service is the difference between seeing their kids awake—or not.

It’s the difference between the ability to supervise homework—or not.

For some people, reliable transit is what makes it possible to work a full day and then go to school at night.

Who are these transit dependent riders?  

Well, every one of you knows who they are in your own systems, but it is worth looking at nationally.

Nationally about 40 percent of transit riders have incomes of less than $25,000 a year. But in some areas like Indianapolis, that number is in upwards of 70 percent.

More than 50 percent of IndyGo riders in Indianapolis are transit-dependent.  Of those riders, 78 percent do not have a vehicle available to them.  60 percent of IndyGO riders don’t even have a driver’s license.

The RTD’s ridership in Denver is 49 percent transit dependent.  In Atlanta, it’s 46 percent.

These are the passengers that have absolutely no choice but to endure whatever service we serve up, clean or dirty, convenient or inconvenient, reliable or unreliable.   

This is just one of many reasons why Secretary LaHood’s strategic goal to address the state of good repair of our transportation system must have special resonance with us and our transit mission.

The prevalence of transit-dependent riders in our urban centers was a central rationale behind the initiation of federal subsidies during the birthing days of UMTA.  It remains to this day a critical reason to adequately fund our enterprise.  This Administration will continue to make that point.

Put simply, when it comes to transit-dependent populations, the reliability of our transit systems is a central measure of whether our society truly respects and honors the contributions of all citizens. 

It goes to the center of what President Obama talks about when calling for a society based on fairness and respect.

As part of my confirmation hearing a little bit more than a year ago, I expressed the concern that deferred maintenance, if deferred long enough, can become a critical safety issue.

Safety is the number one strategic goal for the entire DOT as reiterated by Secretary LaHood recently, and obviously is the top priority for the FTA as well.

In December 2009, Secretary LaHood transmitted a comprehensive transit safety bill to the House and Senate on behalf of the President. It was the first time in the history of UMTA or the FTA that any President has formally transmitted a bill to Congress solely about public transportation.

While the Administration’s Safety bill is principally about rail transit safety, the bill highlights important issues that pertain to all transit operators; the need for good asset management, the need to stay on top of the state of good repair.

And we are concerned not just about passenger safety, but the safety of all transit workers as well—the operators, the mechanics, the folks who are the backbone behind the delivery of service each day. 

There is no question that the tragic deadly rail accident on Washington, DC’s Red Line was an important catalyst that prompted us to transmit our safety bill back in December.  But at the time we were also focused on other accidents—at the MBTA in Boston, the CTA in Chicago, MUNI in San Francisco, and elsewhere. 

We forwarded a very thoughtful and measured safety bill that took into consideration the outreach that Secretary LaHood had done with the entire transit community including APTA. 

It is a bill that is focused on better deploying safety management systems so that each rail operator can be informed and focused on their own unique safety challenges. 

Earlier I talked about the balancing act that each general manager must manage each day.  Our safety bill wants to promote safety management systems and asset management practices precisely so that general managers can balance those priorities in the best informed and safest way possible.

This bill is not about substituting FTA’s judgment for the judgment of the transit professionals on the ground.  It’s about giving those professionals the best information to make the best safety decisions, especially when money is tight.

It is not a bill designed to impose the one-size-fits-all FRA regime across all rail transit operators. 

It’s a bill focused on establishing reasonable minimum safety standards based on the guidance of a Transit Rail Safety Advisory Committee that will have robust representation from rail operators like those in this room.

Secretary LaHood transmitted our bill to Congress in December of last year.  The ball has been in their court since then.  The Congress is holding the pen. 

We are now two weeks and a day away from the anniversary of the tragic Washington Metro crash.  And next month, we expect to receive the final NTSB findings on that tragedy.  It is time for Congress to pick up that pen and move a safety bill forward.  

Every professional in this room knows that safety and the state of good repair are inextricably linked.  So, with Safety as our highest priority, what is FTA doing to address the state of good repair? 

Well, first and foremost, we’re continuing to invest. Our 2011 budget, currently pending before Congress only increases spending by one percent over the prior’s year’s bill. That’s not counting the Recovery Act.  But importantly even in that environment of one percent growth, we have found a way to leverage eight percent growth in our funding of our new formula state-of-good-repair initiative for both rail and bus operators. 

This new initiative combines both the “rail mod” and the discretionary bus program. We are also continuing to invest through our discretionary grants, and we’re going to do it in record time!

We recently announced our competition for over $750 million in SOGR discretionary bus grants.  Now most of the rail operators in this room also operate bus systems.

These funds are limited to state of good repair for bus systems because they come from the bus discretionary program.  But a great many of you should be participating in this competition and please know that applications are due June 18th.

Importantly, with our focus on the state of good repair, eligible projects will include acquisition of asset management systems—tools you can use to improve the management of your own capital stock.

We have other competitions going on. I’m not going to go into them in great detail, but the bottom line is FTA is putting a billion dollars in discretionary dollars on the street. That will also include a small five million dollar initiative on asset management plans that Congress specifically fenced off last year out of our research budget, because they too want us to make advances on asset management and the SOGR.  We’re going to put that money to work in record time.

We are doing it in part, frankly because we know the financial conditions you are setting.  We did heroic work as did you in getting a record amount of money on the street through the Recovery Act—80-percent increase in a single year.

We will also set records for how quickly we will get this discretionary money on the street precisely because you need it, and need it now.

Over and above what we’re doing in the FTA, we also have the Secretary’s TIGER program. The DOT—this is run out of the Secretary’s Office—issued a request for proposals for TIGER II.  We want strong transit applications to compete for that $600 million.

We’re very pleased with the winners of the first round of TIGER grant that Secretary LaHood announced.  FTA and the Secretary together were able to leverage nearly a third of that $1.5 billion directly for transit projects.  And here again, we are seeing the fruits of the confidence that Ray LaHood is showing the transit industry and the FTA.

I’d like to talk about one other issue not necessarily specific to recovery and that is the issue of FTA’s obligation to deal with our grantees with clarity. 

As I end my first year on this job, one thing I intend to focus on more is the overarching need to provide our grantees with clarity and consistency on what we expect.

This Administration and I personally, take these laws very seriously. We want and expect you to do the same.

An important part of our job is to communicate clearly.  An important part of our job is to attend to these issues.

I appreciate fully that the FTA has ten regional offices. We are trying to work assiduously to not have ten different answers as to what these laws mean. Ten different interpretations on what our regulations mean. I will say that on the grant making function we have made progress in trying to establish standard operating procedures.  In the future we will be working on that also for our civil rights compliance issues so that there is standardization. I should also mention that a lot of the brain power and elbow grease that went into developing the standard operating procedures so that we get consistency between our regions was brought on by Susan Schruth.

Unfortunately for us, Susan announced that she intends to retire at the end of next month, so I do want to take a moment to just thank her for her many years of service, as I will many times between now and the end of July. (Applause).

One other issue that sort of flies in the face of this notion that we are abandoning the New Starts program or giving up rail transportation: a few months ago, FTA rescinded the practice established by the former Administration that restricted funding recommendations to the President’s Budget for New Starts and Small Starts projects to only those projects that received a medium or better cost-effectiveness rating.

We stated at the time that we wanted to develop a more holistic view of a prospective project’s total benefits. While maintaining the importance of cost and travel times, we want to examine the environmental, economic development and other benefits of a project the very benefits that under the old regime frankly were ignored. 

This past Thursday, June 3rd, FTA published in the Federal Register an ANPRM on Major Capital Investment Projects.  The whole purpose of doing this as an announced proposed rulemaking was to ensure that your voices and those of all interested stakeholders are heard as we develop our new policies.

At this APTA conference, we are embarking on an intensive ANPRM outreach effort that will include about ten outreach meetings and webinars around the country. If your schedule permits it, please make sure to attend the first of these sessions tomorrow afternoon. That session will be at 1:30 tomorrow afternoon in the Georgia Room, right here in this hotel. If you can’t make that session, I would encourage you to attend one of the later sessions.  We will announce those on our website and in the Federal Register.

So in summary, I want to thank all of you for the service to the public that you do every day. Thanks for showing the public that the President’s historic Recovery Act investment in transit has been money well spent.

In my first series of speeches when I took this job, I made the point that this President has expectation and aspirations for public transportation that his predecessor did not.

Whether it’s the President’s goal to reduce Greenhouse Gases, reduce our dependence on oil, make our communities more livable and improve the quality of life for the elderly so they can age at home, public transportation is at the middle of his vision.

It requires us to step up our game, it requires FTA to step up its game and it requires all of us transit providers to step up their game, even when financial times are hard.  We need to do things harder and smarter. We at the FTA are determined to do so. And we look forward to partnering with you as you do the same.

So thanks for having me here today.