This report provides the U.S. Department of Transportation's recommendations to Congress for allocation of funds to be made available under 49 U.S.C. §5309 for construction of new fixed guideway systems and extensions (major capital investments or "new starts") for Fiscal Year 2001. Section 5309(o)(1) requires an annual report to Congress "that includes a proposal on the allocation of amounts to be made available to finance grants and loans for capital projects for new fixed guideway systems and extensions to existing fixed guideway systems among applicants for those amounts."

The Annual Report on New Starts is a collateral document to the President's annual budget submission to Congress. It is meant to be a constructive element in the administration of the Federal transit assistance program, enriching the information exchange between the Executive and Legislative branches at the beginning of an appropriations cycle for the next Fiscal Year.

The President's budget for FY 2001 proposes that $1,058.40 million be made available for the §5309 major capital investment program. After setting aside a percentage of these funds for oversight activities as specified in §5327, and for ferry capital projects in Alaska or Hawaii as required by §5309(m)(5)(A), $1,040.14 million is available for project grants. This report recommends funding for 38 projects in FY 2001; of these, 14 have existing Federal funding commitments in the form of Full Funding Grant Agreements (FFGAs), FFGAs are pending for three, 11 are expected to be ready for FFGAs before the end of FY 2001 (i.e., September 30, 2001), and ten are nearing the final stages of preliminary engineering.