Administrator Rogoff Remarks: "Next Stop: A National Summit on the Future of Transit" at the Federal Reserve Bank of Boston (as prepared for delivery)
Administrator Peter M. Rogoff
Next Stop: A National Summit on the Future of Transit
The Federal Reserve Bank of Boston
Thank you for that kind introduction.
And special thanks to:
- The MBTA Advisory Board,
- MassINC, Harvard's Rappaport Institute,
- and the 128 Business Council
for hosting and sponsoring this national summit.
You have done Boston and America a great service.
By calling us together, you are highlighting one of our most important national challenges, one that needs a lot more attention by
- the public,
- the press, and
- government officials at all levels.
It's also extremely encouraging to see so many representatives of the business community here today.
The Hub's corporate executives can be very proud of the leadership you have shown:
You have long recognized that public transit can't be taken for granted.
You have recognized that transit is not just a way to get your employees to work; it is a vital part of the economic progress of Greater Boston.
I'd like to see business communities in every city in America stepping up to the plate the way you have. So thank you for leading the way.
We are all here to talk about the future of public transit. When I speak about the future, I like to start with the most fundamental question: Why is public transit important?
President Obama has given his answer.
He's made clear that public transit systems are critical to the nation's ability to
- lower greenhouse gas emissions,
- reduce our dependence on foreign oil,
- and put America back on the path to sustained economic growth.
As he said last year,
"Global climate change and our reliance on foreign oil have also created tremendous national security challenges. To solve these problems and create new economic opportunities, we must make our transportation system cleaner and more efficient."
As President Obama's Federal Transit Administrator, that charge requires me to approach my job every day with the basic question:
- what must public transit systems be and do to help the nation reach the President's goals?
First and foremost, they have to attract and keep riders. That's very obvious, but it is far from easy. I've seen all the studies on rider attitudes, and I ride Washington buses and Metro trains almost every day.
I know that transit riders – especially those who have other options – will only put up with so much. There is a point where:
- dirty stations,
- unreliable service,
- slowed train speeds,
- inoperable escalators, and
- worries about safety push riders back on the highway.
And for those who can’t afford other options, they are forced to live every day with
- grim conditions,
- missed appointments, and
- a poor quality of life.
That's not what equal opportunity and fairness are all about.
So our transit systems must be safe, reliable, and efficient.
Next, as the organizers of this conference put it, transit systems must be sustainable to meet society's needs now and for the future.
So are we there yet?
No – we aren't even close.
This morning, you heard from some of the leading General Managers in our industry. These are the heroes of public transportation. I know each one of them and they've taught me a lot.
As you heard at their panel, they know better than anyone that public transit systems are not where we want them to be…that, unless things change, public transit may actually hinder rather than help support the President's goals for the environment and the economy.
I can also tell you that under each of the GMs' fine business suits you will find the scars from brutal battles they've fought with their local and state governments to get the resources they need.
And don't be fooled by their cool outward demeanor. I know that they are some of the best living and breathing examples of stress management you will ever want to meet.
There is plenty of stress to manage.
Imagine having to maintain service to millions of riders every day, and to trying do so in the face of obstacles that would wear out and stymie lesser people. In fact, when you consider the daunting conditions they face, these General Managers are nothing short of miracle workers.
For years, while General Managers may have known the full magnitude of those conditions, the nation did not. But since 2009 FTA has been gathering information to help make the country aware of the challenges transit systems face… challenges that make it extremely difficult for public transit to support the President’s environmental and economic goals.
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 conditions of our largest rail operators. One of the legislators who requested that report was the then-Junior Senator from Illinois. A guy named Barack Obama. So that report took on an even higher priority for us.
When completed, the report revealed a backlog of deferred maintenance at our seven largest rail operators of no less than $50 billion dollars.
The number was certainly eye-popping. But upon reviewing the results, Secretary LaHood insisted that we expand the study to take a hard look at the entire transit industry. In doing so, Ray LaHood was staying true to his insistence that we address transportation challenges with our eyes wide open.
We are in the midst of finalizing this new report, but I’m happy to say that today, for the first time, I can share some of our more noteworthy findings.
First, when you expand the universe of transit agencies studied from the seven largest rail operators to 690 separate rail and bus systems, the estimated funding shortfall to bring the entire transit system in a state of good repair grows from $50 billion to $78 billion.
When you think about attracting and keeping riders, keep in mind that bringing assets into a state of good repair is NOT the same as bringing them into pristine new condition.
For the purposes of this study, assets that are in a "state of good repair" are those that are brought to what was called the "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 in excellent condition.
Fully 29 percent of all transit assets – rail, bus and paratransit – are in poor or marginal condition.
Those are the statistics, the national numbers – but behind the statistics are frightening stories that appear on riders' newspapers, computer screens and smartphones all too frequently.
- Just three weeks ago here in Boston, the "T" experienced a cable fire that sent 20 passengers from two different stations to the hospital for smoke inhalation.
- Last month in Cleveland, urgent repairs were suddenly needed to shore up a crumbling wall at the RTA's Lee Road station. Buses were called in so the rail passengers could bypass the station.
- Also last month, the system I ride, Washington Metro, discovered three cracked rails along the Red Line in a single week.
- The Chicago Transit Authority discovered a potential defect with a component of the signaling system. As a result, Orange line trains are being slowed to 35 mph between Midway and the Loop while repairs are made to the signaling system.
Clearly, unless we can bring the nation's transit systems into a state of good repair,
- we won't get the riders we need to cut oil consumption and greenhouse gases,
- the sustainability of our transit systems will be in jeopardy; and
- the economic vitality of our cities will be undermined.
So these are the problems, what about solutions?
Before I talk about what the Obama administration is doing to attack these problem, I want to share my observations on what it's really going to take to reverse these trends.
I've been working on transportation issues for almost my entire professional life, more than 20 years as an advisor in the U.S. Senate, and now as FTA Administrator.
Increasingly, I have become convinced that the solutions to these problems – removing the barriers between what public transit is and what it should be -- are not about engineering. And they are not just about economics, as important as dollars are. Instead
- They are about honesty;
- They are about political guts: in particular the guts to say "no" when everyone around the table wants you to say "yes."
- They are about telling truth to power
Let's start with honesty:
Supporters of public transit must be willing to share some simple truths that folks don't want to hear. One is this -- Paint is cheap, rails systems are extremely expensive.
Yes, transit riders often want to go by rail. But it turns out you can entice even diehard rail riders onto a bus, if you call it a "special" bus and just paint it a different color than the rest of the fleet.
Once you've got special buses, it turns out that busways are cheap. Take that paint can and paint a designated bus lane on the street system. Throw in signal preemption, and you can move a lot of people at very little cost compared to rail.
A little honesty about the differences between bus and rail can have some profound effects.
Earlier I pointed out that our new estimate for the deferred maintenance backlog for the entire transit universe is roughly $78 billion. But you should know that fully 75 percent of that figure is to replace rail assets.
Now let's remember that the majority of transit trips in this country are still done by bus. When it comes to delivering actual transit service, Americans take 21 percent more transit trips every year than rail trips. That said, fully three quarters of the funding backlog we face in achieving a state of good repair is associated with underfunded rail assets.
Communities deciding between bus and rail investments need to stare those numbers in the face. Some communities might be tempted to pay the extra cost for shiny new rails now. But they need to be mindful of the costs they are teeing up for future generations.
Is Bus Rapid Transit a workable option for every corridor – no. There are some corridors with the kind of densities and destinations where only rail makes sense.
But Bus Rapid Transit is a fine fit for a lot more communities than are seriously considering it.
Another simple truth – we have to be honest that ignoring deteriorating conditions at our transit systems, runs the very real risk of losing riders.
- worries about safety – drive people away.
Ironically, every study ever conducted will show that, from a safety perspective, passengers are far safer riding even our most fragile transit systems than driving on the highway.
But that doesn't necessarily influence the choices 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 children awake – or not.
It’s the difference between having the chance to supervise homework – or not.
For some people, reliable transit service is what makes it possible to work a full day and go to school at night.
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.
Closely tied to honesty, of course, are the guts to say "no."
I'm now concluding my first year as Administrator. I meet with a great many transit general managers. While these meetings are all different, they often follow a certain pattern.
I start off the meeting by asking how things are going.
They express gratitude for the new Recovery Act funds but then go on to explain that the
- downturn in municipal revenues,
- the downturn in sales tax receipts,
- the cutbacks in the city and state levels,
- has necessitated service cuts.
Sometimes we talk about serious service cuts of 20 percent or more. We talk about:
- route reductions
- Significant chunks of capital reinvestment being deferred as they use Federal capital dollars for preventive maintenance to close operating gaps.
It's all very grim.
But then we get to the second part of the meeting. The consultants start to get excited and the glossy brochures come out. And the next thing you know, the general manager wants to talk about their new plans for expansion -- the spanking new rail service to communities not yet served.
In fairness, many of these new communities have been waiting for a long time to get rail service. Indeed, many were promised rail service as part of a sales tax referendum that was passed a decade ago. The other communities got service – but now those are more expensive than originally forecast – and the sales tax is taking in far less than expected.
At times like these, it's more important than ever to have the courage to ask a hard question: if you can't afford to operate the system you have, why does it make sense for us to partner in your expansion?
If you can't afford your current footprint, does expanding that underfunded footprint really advance the President's goals for cutting oil use and greenhouse gases? Does it really advance our economic goals in any sustainable way?
Are we at risk of just helping communities dig a deeper hole for our children and our grandchildren?
Might it make more sense for us to put down the glossy brochures, roll up our sleeves, and target our resources on repairing the system we have?
Along these lines, I mentioned telling truth to power. To me, that includes the uncomfortable situation of calling someone out when their behavior isn't responsible.
My favorite example is the Douglas Branch of the Blue Line in Chicago. The Douglas Branch was build about 110 years ago. In its heyday, the late 1970s, annual ridership on the Douglas Branch reached five million, on infrastructure originally designed to allow speeds up to 55 mph.
But by 2001, the Douglas Branch had deteriorated to the point where trains could operate no faster than 15 miles per hour over half of its length. Runs that were designed to take 25 minutes were taking up to 45 minutes. So guess what? Annual ridership was cut in half, to 2.5 million.
This story does have a happy ending. Eventually, the Douglas Branch was largely rebuilt with the help of FTA funds. The reconstruction was completed in 2005, on time and under budget. Ridership is back up to 4.5 million, proving that the ridership was always there.
Still, the question has to be asked, how and why was the Douglas Branch allowed to just rot on the vine? Where were the policymakers at all levels that allowed conditions to deteriorate so far?
When it comes to calling out the truth – I want to praise Governor Patrick for requesting the D’Alessandro study.
It paints a very honest, if grim picture of what needs to be done here in Boston.
It's an important step in turning things around.
It allows for the kind of "eyes wide open" discussion that we need to have all over the country.
So I've spent a good bit of time outlining the challenges and problems we face.
Well, what is the Obama Department of Transportation doing about them?
What specifically are we doing at the FTA to address them?
What are we doing to help achieve the President’s goals for healthy, sustainable transit systems?
First and foremost, we are busily administering a record level of Federal investment in our transit system. That record level was made possible through the American Recovery and Reinvestment Act.
The Recovery Act boosted Federal transit funding by 80 percent in a single year. And a great deal of the credit for that belongs to the foresight and vision of Chairman John Olver from the 1st District.
The Recovery Act delivered more than $735 million dollars in transportation funds to Massachusetts.
Almost $330 million of that amount was in the form of Recovery Act dollars just for public transportation here in the Commonwealth. And more than $250 million of that amount was for transit investments in the greater Boston area.
We have created and saved hundreds and hundreds of jobs.
We are stepping up at the Federal level to make the investments at a time when the Commonwealth and local communities are ill suited to make them.
Earlier, I talked about the findings of our new study on the State of Good Repair. That study indicates that more than 6,000 of the nation's almost 72,000 buses are in need of replacement, having exceeded their useful life.
But we also know from our own grant reporting system that the Recovery Act is going to replace more than 12,000 transit vehicles. This will include a lot of buses as well as paratransit vans.
So this may be one area where we look back in a few years and discover that the Recovery Act has really alleviated a major shortfall.
Earlier this month, under Secretary LaHood’s leadership, the entire Department of Transportation has established the State of Good Repair as one of just five strategic goals for the Department's future direction.
This is not just about the State of Good Repair of Transit Systems. It is about the state of good repair of:
- Our highways;
- Our runways;
- Our ports;
- The air traffic control system.
When it comes to our 2011 budget for transit, we are also putting our money where our mouth is when it comes to the State of Good Repair.
In a budget that grows by only 1 percent in 2011, the Obama Administration has reordered priorities so that our new State of Good Repair initiative for both rail and bus systems will grow by 8 percent. That budget request is currently before Mr. Olver's Committee. It is the largest boost in formula funding for any Federal transit program.
In the past few weeks, FTA published several notices of discretionary funding availability, including $775 million specifically to address the SGR of bus systems.
We understand that state of good repair is not just a rail problem – it's a problem for buses too.
When I speak of the need to have the courage to say "no", we had to make that choice when it came to not to recommend funding for the Sacramento South Corridor Project in our FY 2011 Budget. We did so even though we did recommend the project for funding in 2010.
Sacramento has been hit by a "triple whammy" that has undermined funding for the system. First is the overall downturn in the California economy. Second is the fact that the Governor successfully eliminated State transit operating assistance last year. It was restored only partially this year at a reduced level after the courts found the Governor's action to be illegal. But a whole year of state funding was lost. Third is the fact that Sacramento has taken a big hit on farebox revenues because so many of its riders are State employees commuting to work. A very great number of those employees are now on furlough and aren't traveling to work.
We at the FTA are also looking at innovative ways to better ensure that expanding systems will have the money down the road to maintain those expansions. One idea that has been successfully used for a new transit mall in Portland is the financing of a sinking fund. Sinking funds are commonly used to ensure the later repayments of bonds. We are seeing if they can be used to ensure the availability of funds for SGR. By approving a transit expansion with a sinking fund, we would at least have the confidence that the expansion will not worsen the project's SGR needs.
The FTA is also using $5 million that was set aside last year to expand the use of Asset Management by transit agencies of all sizes. Asset management will be a critical tool to ensure....
And finally and importantly - we've also done a great initiative that really is inextricably linked to the area of state of good repair and that is rail transit safety.
Back in December, Secretary LaHood, on behalf of the President, transmitted the first comprehensive public transportation bill sent to Congress that was solely about public transportation. It was a comprehensive, and we think, very balanced transit safety bill, focused specifically on rail transit safety in the early years.
Right now, many people may not appreciate the fact that my agency is prohibited by law from issuing safety regulations of any kind. This came to a head, unfortunately, following the WMATA crash last June, but, in fact, the agency had been focused on a number of very serious concerns and accidents not just at WMATA but at the CTA in Chicago, Muni in San Francisco and other agencies spread around the country.
We do believe that there is a path forward to allow a reasonable, balanced, federal regulatory regime that isn’t going to be about recreating the FRA rule book that will be this thick; but is really about just making sure that all of our grantees are engaged in best practices when it comes to safety management systems and asset management.
So we have also found room within a very tight budget of just one percent growth to fully fund the first year's deployment of that safety initiative.
Let me conclude by saying something you don't hear too often in discussions of public transit policy. I believe that ultimately the choices we face are moral choices.
That is we must remember that decisions we make now will be a choice between one set of values and another, between one kind of future and another for our children and grandchildren.
One choice is to use just enough scarce funds to let the public transportation sputter along for another year. That’s tempting to some political leaders. Unfortunately, that choice will leave our children and grandchildren with a system that can’t attract riders and is burdened by a sea of debt.
The other choice is to take a cold look at the facts. That might mean spending money on the unglamorous but absolutely vital work of repairing and improving our current systems.
You know, there is always a big press event with lots of cameras, microphones and political leaders, when we open a new light rail line. We need to think about how we generate the same attention and excitement when we repair the retaining wall, replace rail ties, or refurbish a bridge so that more passengers are able to travel by rail more quickly. I will make the commitment that the next time I come back to Massachusetts that will be the next event that I participate in. We should all make similar commitments.
At the same time, we must find more rational, reliable ways to fund our great transit systems.
If we do, we can ensure that our grandchildren enjoy efficient, safe, comfortable systems that protect the environment, serve the economy and will be around for a long, long time.