ADC Asks Congress to Reformulate New Starts

ADC has joined with eighteen other national and state think tanks in asking Congress to reform the New Starts program that funds most new rail projects. ADC offered three arguments against the current process:

  • New Starts effectively gives cities and transit agencies incentives to propose the most expensive projects they can in order to get the most federal money.
  • As a discretionary fund (meaning the money is spent at the discretion of the president), New Starts is also political, giving the president power that Congress shouldn’t grant.
  • Finally, New Starts is inequitable, leading a few states and urban areas to get far more money per capita than the rest of the country.

In the last major transportation bill in 2012, Congress converted other discretionary funds, including the bus and bus facilities fund, ferry and ferry facilities fund, and congestion mitigation/air quality fund, to formula funds, meaning they are given to states and metropolitan areas based on such factors as population. ADC has asked Congress to turn New Starts into a similar formula fund, preferably one based on the user fees transit agencies earn from their customers. This would give agencies incentives to operate more for transit riders than for rail contractors.

In support of these ideas, ADC sent a letter to Pennsylvania Representative Bill Shuster, who chairs the House Transportation & Infrastructure Committee. A nearly identical letter was sent to Oklahoma Senator Jim Inhofe, chair of the Senate Environment & Public Works Committee. A third letter was sent to Missouri Representative Sam Graves, chair of the House Highways & Transit Subcommittee. Finally, a letter was sent to Louisiana Senator David Vitter, chair of the Senate Transportation & Infrastructure Subcommittee.

No actual legislation has been written and ADC’s letter merely serves as a policy recommendation for the future. If you would like to support this policy, you can download a generic version of the letter which you can rewrite to send to your senators and representatives.

ADC’s letter cites three reports to support its policy recommendation. First is a Reason Foundation report showing that discretionary funds are highly politicized. This is supported by a GAO report that shows these discretionary funds are often inefficiently used. Finally, a Cato Institute report found that New Starts funds give cities and transit agencies incentives to waste money, putting a heavy burden on taxpayers.

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