DEPARTMENT

OF TRANSPORTATION AND RE

LATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1986

THURSDAY, APRIL 18, 1985

U.S. SENATE,

SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS,

Washington, DC.

The subcommittee met at 10:09 a.m., in room SD-138, Dirksen Senate Office Building, Hon. Mark Andrews (chairman) presiding. Present: Senators Andrews, Abdnor, Kasten, D'Amato, Chiles, and Lautenberg.

DEPARTMENT OF TRANSPORTATION

URBAN MASS TRANSPORTATION ADMINISTRATION

STATEMENT OF HON. RALPH L. STANLEY, ADMINISTRATOR, URBAN MASS TRANSPORTATION ADMINISTRATION

ACCOMPANIED BY:

ALFRED A. DELLIBOVI, DEPUTY ADMINISTRATOR, URBAN MASS TRANSPORTATION ADMINISTRATION

JOSEPH A. LA SALA, CHIEF COUNSEL, URBAN MASS TRANSPORTATION ADMINISTRATION

KENNETH W. BUTLER, ASSOCIATE ADMINISTRATOR FOR BUDGET AND POLICY, URBAN MASS TRANSPORTATION ADMINISTRATION RAYMOND J. SANDER, EXECUTIVE DIRECTOR, URBAN MASS TRANSPORTATION ADMINISTRATION

ROBERT H. McMANUS, ASSOCIATE ADMINISTRATOR FOR GRANTS MANAGEMENT, URBAN MASS TRANSPORTATION ADMINISTRATION PETER BENJAMIN, ASSOCIATE ADMINISTRATOR FOR TECHNICAL ASSISTANCE, URBAN MASS TRANSPORTATION ADMINISTRATION

OPENING REMARKS

Senator D'AMATO. The Subcommittee on Transportation will convene. Senator Andrews is on his way, and so in the interest of giving those who have been here today an opportunity we will begin. Mr. Stanley, we are delighted to see you and your staff and the UMTA people. Although we may disagree with respect to certain aspects of the budget as it affects Amtrak, let me suggest to you that rather than making the cuts as severe as those that have been proposed, and also by the Budget Committee, and the proposed compromise, which will be about a 25

percent cut-and I am going to put my statement in the record as if read in its entirety—it would seem to me that a hold-the-line approach, or cuts that would be less drastic, would be in order, since there is a deficit problem. We recognize that we have to do our part in reducing the budget deficit.

It also seems to me that simply to say that Amtrak should be closed in total, just shut it down, is an oversimplification. This Nation cannot afford not to have a national transportation system or rail transportation system. At the same time, we in the Congress have got to recognize that where there are lines that have no justification other than political muscle, porkbarrel philosophy that has kept certain operations open that should not be open. We have a duty also then to be able to give up the so-called sacred cows, those areas that exist as a result of politics, and not as a result of true, identifiable need. So I make that statement in the overall. I understand that Amtrak does not come under your jurisdiction, but the Nation's transportation in general is something that we have got to be concerned about. I would think that those are the kinds of compromises that we have got to try to make.

PREPARED STATEMENT

I am going to submit my statement for the record as if read in its entirety, and Mr. Stanley, in the interests of time, while we are waiting on Chairman Andrews' appearance, why do you not start to make your presentation.

[The statement follows:]

STATEMENT OF SENATOR D'AMATO

Mr. Chairman, I appreciate this opportunity to offer my remarks concerning the proposed Fiscal Year 1986 budget for UMTA. Without a doubt, I have serious concerns' regarding this proposal and look forward to discussing them with the

subcommittee.

As you know, under the Administration's proposed FY 86 budget of $24.7 billion the Department of Transportation would experience an overall cut of about 13% ($3.8 billion) from last year. Such a cut is, per se, not unreasonable. However, nearly 70% ($2.75 billion) of those cuts would be derived from devastating and thoughtlessly conceived reductions in Federal aid to public transit. The New York City Metropolitan Transportation Authority (NYC MTA) would lose $108 million in operating assistance and $285 million in vital capital aid.

Operating assistance, which is the lifeblood of the nation's smallest transit systems, would be abruptly terminated without any transition period to enable states and localities to plan for the future. Funding available for transit capital needs would be distributed strictly on a formula basis. Its source of funds would be limited to the $1.1 billion per year which OMB conservatively estimates to be generated by the one penny of gasoline tax set aside for mass transit. CBO says that more than $1.6 billion is available from this fund. No general tax revenues would be used for transit.

When Secretary Dole testified before this subcommittee

on February 21, 1985, I told her that I would fight these unreasonable and crippling cuts. Transit must not be made the scapegoat for other programs that have failed to hold the line in fighting the deficit. Indeed, if other federallyaided programs had taken the 20%-10%-5%- type of cuts that transit operating assistance took in the Surface Transportation Assistance Act (STAA) of 1982, we wouldn't have such a severe deficit problem.

The NYC MTA would lose $108 million in operating assistance.

The NYC Transit Authority normally receives $80 million of that sum, and without it will need to raise fares at least a nickle. The commuter rail operations which receive about $24.4 million will need to raise fares by 5% to 6%. Federal aid now accounts for only about 3% of the NYC MTA's operating budget, while in small urban and rural areas that percentage can go much higher.

Since 1980, the use of Federal aid for transit operating assistance in New York State has been reduced by 30%. Meanwhile statewide operating expenditures have grown faster than the Consumer Price Index (CPI) despite relatively constant service levels. For example, costs for the MTA have grown about 50% between 1980 and 1984, with the upstate transit authorities averaging 40% for the same period. The CPI increased 30% for the comparable period. The point is that New York has been paying its fair share while the amount of available Federal operating assistance has been frozen.

The proposed sweeping changes in the transit program will affect the ability of virtually all the nation's public

transit systems to offer adequate service.

The American

Public Transit Association (APTA) has surveyed 152 transit systems which carry 75% of the nation's transit riders, as well as 63 transit-related businesses which employ over 40,000 workers, in order to determine the impact of the budget cuts. APTA found that 30 systems might be forced out of business, 88% will have to cut service dramatically, and more than eight in ten will be forced to raise fares so high as to discourage ridership. In addition, the budget cuts would wipe out an estimated 203,000 jobs and $8 billion in private business revenues.

In addition to proposing no new discretionary funding for fixed guideway projects, I understand that the proposed budget would use the available funding from 1984 and 1985 to complete those fixed guideway projects "... which are now under construction or which can be fully financed within these available funds." When Secretary Dole testified before this Subcommittee on February 21, she stated that any plan to reprogram earmarked funds would be submitted to us prior to Administrator Stanley's appearance today. Thus far, I have not seen any such reprogramming plan and I am curious as to which earmarkings UMTA is planning to honor and which ones are being reprogrammed to other projects.

I understand that UMTA intends to eliminate funds earmarked for Los Angeles, Miami, Houston, St. Louis, San Diego, Buffalo and Jacksonville. FY 85 new starts funding.is to be used to complete existing new start commitments (i.e., Portland and Santa Clara), and rail modernization or highly rated, one-time new starts. A bus tunnel in Seattle would be fully funded.