2007 APTA Annual Meeting Speech - Charlotte, NC


10-08-07


REMARKS

ADMINISTRATOR JAMES S. SIMPSON

APTA ANNUAL CONFERENCE

CHARLOTTE, N.C.

OCTOBER 8, 2007

Thank you Michael Townes for that kind introduction. I am pleased to be here with all of you… the leaders of the public transportation industry.

I am also proud to be here on behalf of President George W. Bush and U.S. Secretary of Transportation Mary Peters.

I would like to thank APTA, 

Charlotte Area Transit System (CATS)

City of Charlotte

Mayor Patrick McCory

Ron Tober 

BUSINESS NOT AS USUAL

I want to begin by sharing with you a brief story that sheds light, I think, on FTA’s effort this past year to think outside the box about transit -- how we’re tackling transit problems and working with communities to solve them as efficiently and economically as possible. Not long ago, John Inglish, the general manager of Utah Transit, and some other folks from Utah, paid FTA a visit to describe their proposal for a New Starts grant. Inglish and his staff expected an answer from us within six months or so. Instead, they got an answer in six hours. FTA and Utah have signed an historic Memorandum of Understanding covering UTA’s plans to build 70 miles of light and commuter rail by 2015. This program of projects will cost $2.85 billion, of which the FTA would provide $585 million. By looking at this as a program, rather than as individual projects, we can save taxpayers upwards of $1.4 billion. And the agreement allows the system to be built in seven years, not 30, as previously planned. Senator Bennett of Utah wrote to me in a letter that Utah Transit’s experience “is a wonderful example of how FTA and local agencies can cooperate to solve transit, community development, and mobility issues.”

Now, I tell you this because I think it signals a shift for FTA away from focusing just on public transportation facilities and services, to focusing on our customers like John Inglish and the UTA staff.  The lesson here: “Don’t think mode, think people.”  That’s become our motto.

And, it’s a motto that’s increasingly recognized by other notable transportation visionaries, like Gordon Bethune (former Continental CEO) and Robert Crandall (former American Airlines CEO).  Both were quoted in a recent Wall Street Journal article as supporting the idea that improving and expanding passenger rail in the Northeast Corridor may be the best way to reduce aviation gridlock. I believe that such mode-neutral thinking is central to a new paradigm in transportation.  I believe that we must stop thinking in terms of mode--no more highways versus transit or bus versus rail. Instead, we MUST think in terms of people and focus on our customers.

My friend, Joe Giglio hit the nail on the head in his book “Driving Questions.”  He recognized that the main goal of every enterprise must be to create a customer. Our first task among transportation providers is to establish an awareness of the customer as the number one focus of all activities.

Now I want to talk about what we’re doing at FTA, and why.  Last year, I stood before you and told you about the talented and energized staff at FTA. I stated that I wanted to leave FTA in better shape than when I arrived, and that I would look for new and innovative ways to improve an already great organization.  Our motto, ‘Don’t think mode, think people,’ works not only for our customers, but for FTA itself. 

 

To that end, we have made Continuous Improvement part of our culture at FTA and have boldly submitted an application for the Malcolm Baldridge National Quality Program. The application process included a comprehensive assessment utilizing proven business criteria, such as knowledge management, customer focus, and results, in measuring ourselves against “best-in-class” private sector companies.  Based on our analysis, we are an organization dedicated to the mission of providing excellent service to our stakeholders.

But we know we can do better.  You should have already seen improvements in little things, like how we answer the telephone, respond to inquiries, and set up meetings.  We are also tackling bigger issues like the time it takes to get an FFGA, the complexity of the New Starts process, and new ways to deliver projects.

New Starts-------PAUSE---------------

As you may know, since my arrival, FTA has executed 7 Full Funding Grant Agreements (all rail) with a Federal share of over $3.6 billion, and total project costs of approximately $10 billion.  Our most recent FFGA, the Norfolk Light Rail project was signed on October 1 and we expect to see the Northstar commuter rail project in Minneapolis submitted to Congress for review any day now.  We’ve also initiated the Small Starts program, proposing four Small Starts projects in the ‘08 Budget and have jump-started two of them in using discretionary ‘07 New Starts funds.  Next month, after 70 years of planning, we will sign the FFGA for Second Avenue Subway in New York—who says the New Starts Process is slow and bureaucratic?!

As far as the pipeline of projects is concerned, there are several that look particularly promising including the University extension of the Seattle light rail line and the New Jersey Access to the Region’s Core project.  That’s why for New Starts, we’re working to streamline the process so that decisions are made more quickly and projects are delivered sooner. 

ELEPHANTS IN THE ROOM – NPRM AND BUS NOFA

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Now I know we have a couple of elephants in the room.  As Woodrow Wilson said, “If you want to make enemies, try to change something.”  Now, I don’t believe we have made any enemies, but just in case……

Two weeks ago, I testified before Congress about the recent NPRM on FTA’s New Starts and Small Starts programs.  While I know there are some controversial features in the NPRM, like how we treat economic development benefits and the concept of Very Small Starts, I believe that the NPRM supports the continuous improvement of the New Starts program.

One part of improving the process is to listen to our customers.  That’s why we have had extensive outreach on the NPRM we have just issued and held four outreach sessions (in Los Angeles, Denver, Chicago and D.C.) The final session is tomorrow afternoon, scheduled in coordination with this conference.  I’d like to encourage you to attend and, more importantly, to comment to the docket.  We need your input to make the New Starts process better. We expect that the Final Rule will be issued some time in 2008.

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The other issue that I’m sure is controversial …. is the recent announcement of the allocation of FY 2007 Bus funds.  I’m sure some of you share the sentiment expressed in an email I received from Ron Baumgart, from River Cities Transit in South Dakota, who said “I was certainly disappointed to read FTA’s Announcements of Project Selections for FY 2007.  It alarms me to see all $438 million going to Urban Transit Projects, and not a single dollar to rural projects.”  I called Ron to talk to him and explain why we did what we did.  I hope once I give you some of our reasoning you, like Ron, will come to see our point of view.

We believe that The Department’s Congestion Initiative provides a unique opportunity to supply substantial amounts of funding to jump start innovative and comprehensive approaches to congestion reduction.  These funds will be strategically invested in our nation’s most congested areas.  However, the impact of these investments will be felt across the country.  Our commitment was to allocate the Federal contribution in a lump sum, not in bits and pieces over several years – an approach meant to get these projects off the drawing board and into action.  This strategic investment approach will increase mobility, provide critical congestion relief and showcase new solutions to combat the congestion that is choking our nation’s highways.   I am pleased to say that the Department was able to select five extremely strong Urban Partners (Miami, Minneapolis/St. Paul, New York City, San Francisco, and Seattle) who will be undertaking some fairly bold, comprehensive steps to address this issue. 

Transit plays a central role in each of the Urban Partnership programs.  In fact, transit ridership is expected to grow as congestion pricing provides incentives for transportation system users to seek alternative travel options.  In addition, these arrangements also can provide for significant new ongoing streams of revenue to support transit, well in excess of the amounts being invested. 

CHALLENGES/MEGA-TRENDS

Living the motto “Don’t Think Mode, Think People” means recognizing and acknowledging the challenges transit agencies face today and those that lie ahead. We believe there are three megatrends on which we should focus: 1) congestion, 2) energy and the environment, and 3) human service transportation needs.  Let me describe each of these challenges, and how I believe we should respond.

The first megatrend is Congestion.  The Texas Transportation Institute’s recent report on congestion found that urban surface transportation congestion cost over $78 billion in 2005, and without transit’s congestion management services, the lost productivity would be $10 billion greater.  This benefit alone can justify our transit investments. 

Our second megatrend is energy independence and improving the environment—and our congestion initiative will also go a long way toward addressing this.  It is no secret that our nation has serious concerns about the amount of energy that we consume and the amount of foreign oil that we import to meet our needs. A strong energy independence policy, like the one the President outlined in his “20 in 10” plan, which challenges Federal agencies to institute policies to reduce our dependence on foreign oil by 20 percent over the next ten years, will also have a significant environmental impact.  As Secretary Condoleeza Rice recently said: “…climate change is a real problem -- and human beings are contributing to it.  The best science tells us exactly this.  Now, it is our responsibility as global leaders to forge a new international consensus on how to address climate change.”

Transit serves our national interests in this regard. Transit systems have the ability to move people with greater efficiency, and transit can play a leading role in reducing our dependence on foreign oil, and on reducing greenhouse gas emissions and other pollutants. 

By incorporating the latest designs in vehicles that make use alternative fuels, such as biodiesel, Fuel Cell, or hybrid, transit’s share of energy consumption can be further reduced. 

For rail systems, hydroelectric and wind energy can be used to power transit vehicles with zero emissions from fossil fuels.  And it doesn’t stop with just the vehicles, but can include transit stations and buildings as well.  New building technologies to save energy, coupled with environmental technologies, can be incorporated into the design and operation of high performance and environmentally green buildings.  And transit supportive land use is becoming increasingly important as a way of reducing environmental damage.

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Being energy efficient and environmentally proactive, however, means nothing if the people who need transit most don’t have access to transit.  And this brings us again to our theme of focusing on people, not modes. The third megatrend I see is the growing need of people who depend on transit.  More and more Americans with disabilities are entering the workforce, approximately 37 million people live below the poverty line, and older Americans – Baby Boomers – are the new market for transportation.  We must ensure that these groups, who often need transit options the most, have the chance to stay active and engaged in the community through real transit options.

We’ve laid a great foundation for mobility, through our services and the implementation of the Americans with Disabilities Act, but we still have work to do. We can’t talk about bus and paratransit service without talking about coordination of service.   Coordination and mobility go hand in hand, particularly in rural and smaller urbanized areas.  Through United We Ride, we are working to meet this challenge.  In addition, we are working with APTA on a Mobility Managers Initiative to provide you with additional tools to meet this challenge. 

There are some formidable challenges to be faced along with these megatrends.  For example, once we’ve taken those cars off of the road through measures like road pricing, how will your system handle a five, 10 or 15 percent increase in ridership?   In the short term you may be able to add service or redeploy your existing assets.  In the long run, though, we will need more fixed guideway service—light rail or fixed guideway bus service, which will require new investment. 

Another challenge: SAFETEA-LU provided record levels of Federal assistance for surface transportation, but it did so by spending down the balances in the Highway Trust Fund.  The Highway Account is likely to go negative sometime in FY 2009, with a cash shortfall of nearly $4 billion.   While the Transit Account will still have a positive balance in FY 2009, it too will go negative, most likely in FY 2011, at present rates of spending.  Clearly, the current structure IS NOT SUSTAINABLE.

In facing these challenges, the Federal Transit Administration refuses to accept a lack of accessible transportation options, traffic congestion, excessive energy consumption, and pollution as facts of life.

MEGA-SOLUTIONS

So, we’ve identified some of today’s transit challenges. And we’re proud of the solutions and programs we’ve come up with so far to combat these challenges.

BUT these aren’t everyday problems! These are megatrends, and for megatrends we need mega-solutions! We must make sure that every decision we make is consistent with our motto: “Don’t Think Mode, Think People.”

Some have suggested that raising the gas tax will address the spend-down problem.  But it won’t!  Raising the gas tax does not address a fundamental flaw in our transportation policy: we fail to look closely at where we are spending these gas tax resources.  Special projects—earmarks—for the most part, don’t take into account national needs.  Without addressing this fundamental issue, adding more money to the gas tax pot simply makes more money available for those special projects.  And, it will not address the need to develop mechanisms to efficiently manage existing capacity and expand capacity in locations where the benefits are greatest.

Recognizing that a fundamental rethinking of the program was needed, Congress, in SAFETEA-LU, established two commissions to address the upcoming shortfall in transportation funding.

One of the key issues that these commissions must address is “What is the proper Federal role in surface transportation?”  An answer to this fundamental question will help inform the policy recommendations made by the commissions.  And, I would challenge all of you to consider how you would answer that question as you develop your positions on the future of Federal programs.

There are a number of possible answers to such a question. On one hand are those who might say that the Federal role should be limited to enhancing interstate commerce.  This school of thought would limit Federal funding only to Interstate highways and corridors and perhaps ports and border crossings.  In this model, State and local governments would be responsible for the remainder to the highway and transit network.

On the other hand, some will cite the importance of vital and efficient urban areas to a strong national economy.  In this model, Federal funding would be provided to improvements in urban highway and transit networks which minimize urban congestion.

Yet another answer would stress reduction in the environmental footprint of transportation by focusing on improved efficiency to reduce emissions and use of fossil fuels. 

Others would stress personal mobility, especially for those with lower incomes, age, or disabilities that would otherwise inhibit accessibility.

No matter how you answer the question, constrained resources require us to make new or different choices among them.  Fortunately, FTA is ready, willing, and able to make these decisions. There are many fresh approaches and opportunities for new funding if we branch out and look beyond the usual resources.

CONCLUSION: UNITE BY THINKING PEOPLE, NOT MODE

In conclusion, as I said before, the focal point of our business can no longer be mass transit versus highways or rural versus urban.  It is disturbing that that this thinking is still alive and well.  For example, following on the heels of the tragic I-35W Bridge collapse in Minneapolis, a Wall Street Journal editorial bemoaned SAFETEA-LU saying that the bill “diverted billions of dollars of gas tax money away from urgent road and bridge projects toward…inefficient urban transit systems.”  Even a front page story in the New York Times echoed the same sentiments, almost word for word.  But where will that rhetoric get us? That sort of thinking is counter-productive and does little to solve problems. 

AASHTO in their recent report “Transportation: Invest in Our Future,” thinks otherwise, calling for a doubling of transit ridership by 2030, together with significant investment in highways and bridges.

The solution is NOT to divide, but to UNITE. To paraphrase Tom Donohue, President of the U.S. Chamber of Commerce, we must put an end to intermodal squabbles.  He calls on us to rally and unite around an urgent and compelling mission—to rebuild America. 

So why do we want to rebuild America?  Because we believe that a seamless transportation network will focus on moving people.  People like MY grandmother who was unable to drive and had no way to get into town.  People like the single parent who cannot afford an automobile but needs to get to work to pay their bills, or people like the driver stuck in traffic trying to pick up their child at day care. Our programs, our issues, our goals, should be built around helping the American people. As leaders in the transportation industry, we must be up to this challenge.  Working together, not Thinking Mode but Thinking People, I believe we can move America forward so that all Americans have the mobility they deserve.

 

Thank You.