Posts about John Mica

Why a six-year bill

At yesterday's press event to roll out the bill, Mica and other House members explained their commitment to a six-year bill, in contrast to the Senate proposal of a two-year bill.

"We want long term bill," Mica said. "We heard across the country that our state secretaries of transportation want some stability."

Richard Hanna, the vice chair of the Highways and Transit subcommittee, contended that the stimulus failed to boost employment significantly because "shovel-ready," short-term projects don't create many jobs.

"By passing a six-year transportation bill, this committee will provide the states and transportation agencies with an established stream of federal funding that will allow them to take on major projects," said Hanna. "Given this predictability, states will be more comfortable taking on bridge replacement, highway interchange improvements, etc. These are projects that provide jobs for two or three years, not two or three months."

Without the assurance of a long-term bill, Hanna said, "states will continue to put off major construction projects."

"The two year plan is a recipe for bankruptcy of the trust fund and also a closedown of long term projects across the country," said Mica. "And if you don't believe that, look what's happened. We're under a two-year extension right now, which expires in September. That'll be two years. And look what it's given us! Not much."

Even advocates of a short bill agree that a longer one is ideal, as it allows for planning, but they say transportation agencies can't plan major projects with the tiny trickle of federal funding the House bill would let flow to the states, either. Some state DOT heads say they'd rather have adequate funding for two years than meager funding for six.

Rules and funding constraints

Mica made it clear that while he's also disappointed the funding levels are so low, he's hampered by the political climate of fiscal conservatism in the House and, more specifically, by House Rule XXI, which includes a "pay-as-you-go" provision that Mica takes as a prohibition on spending more than the Highway Trust Fund takes in.

"I wish I could jump over the moon," Mica said, "but I can't do that either."

He said several times that he and other committee members would be appearing before the Ways and Means Committee, which makes decisions about how to fund programs, to appeal for help. He wasn't very specific about what they'd ask for, though he did mention some bonding and tax credits for private companies investing in infrastructure. He wouldn't say that he would push for any kind of increased user fee, whether a gas tax hike or a VMT charge.

"We've tried to look at every dollar of revenue that's coming in and how we can maximize it," Mica said, explaining that by consolidating programs, encouraging private investment and streamlining the review process, he thinks they can "do more with less."

They're eliminating 70 programs out of the "mind-boggling" list of federal transportation programs and "devolving to the states the ability to approve" programs. Federal mandates for certain programs (including bike, pedestrian, and other livability programs) will be eliminated, but states will maintain the "flexibility" to spend money on those things. Unfortunately, if history is any guide, many states end up under-spending on these alternative transportation programs, even disproportionately sending bike/ped money back to Washington when called upon to rescind funds from their budgets.

Mica said there will be more money available (despite the smaller size of the bill) for all of those programs because it cuts federal overhead costs and eliminates the need for state and local officials to "hightail it to Washington to talk to some bureaucrat in one of the agencies."

Focus on highways

"The focus of the bill is on the national highway system," Mica said, in answer to a question about the elimination of funding for walkability. "We can't fund every local project."

"We're trying to make certain that our federal responsibility is met first, and that's our interstates and our major infrastructure projects."

He then used the opportunity to boast that the bill has no earmarks, reducing the amount spent on frivolous "pet" projects, and that there are no "special set-asides"—Republican code for things like multi-use trails.

Republicans say their plan would keep the Highway Trust Fund afloat, whereas Democrats' plans would drive it into the red.

The bill doesn't have any dollar amounts attached to specific programs but Rep. Bill Shuster said that it doesn't have anything specifically for high-speed rail. Still, he promised that the plan would improve upon the high-speed rail program, which he accused the Obama administration of "mishandling."

"We're going to fix it in this bill," Shuster said, "requiring that projects are truly high-speed—and the definition of high-speed will not be 110 mph; it will be 125 mph." He also pledged greater transparency.

They're cutting Amtrak's funding by 25 percent and placing limits on what the funding can be used for. For example, Shuster said, it couldn't be "squandered" on lawsuits like one that Amtrak is involved in now.

The plan also calls for improvements to the Railroad Rehabilitation & Improvement Financing Program, which is funded at $35 billion but has only managed to spend about $1 billion in the last 13 years.

No competition but private competition for transit

Mica is one Republican who has long been a fan of rail and mass transit. At yesterday's event he said, "When you see the price of one car on the road, and new highway construction through metropolitan areas or even rural areas, you become an advocate of transportation alternatives."

Still, that support hasn't translated into any breaks for transit in this bill. Even with transit's share of the overall pie staying the same, the reduced overall funding levels would mean a cut from about $11 billion for transit today to about $7 billion.

On the positive side, the proposal would "streamline" the New Starts and Small Starts program for transit, "cutting project development time in half," according to the plan. Indeed, project development times are slated, under this plan, to go from 15 years to six by making federal reviews happen at the same times, instead of each waiting for another to end.

But overall there's a lot of bad news for transit in this bill. The transit section also encourages private companies to provide public transportation services. House Republicans like what they see in the success of privately run intercity buses and want to see vanpools compete with city buses in urban areas, in addition to more private participation in rail transit. Some critics of private participation at this level worry that private operators will take over the lucrative routes, leaving the slower routes for public agencies to run (and lose money on).

The plan would also repeal discretionary transit programs that the Republicans say are "unpredictable and not transparent," returning instead to strict formula funding. This move flies in the face of repeated and growing demands for increased performance measures, which would often use discretionary funds as a "carrot" to encourage cost-effective programs that meet national transportation goals.

Indeed, the House bill is notable in its rejection of performance measures and competitive programs like TIGER and the Sustainable Communities grants instituted by the Obama administration. Committee staffer Jim Tymon had to field Streetsblog's question on performance measures when Mica couldn't answer it, but Tymon's response was vague.

He said that performance measures would be developed in conert with USDOT and state DOTs. He said that while states will have increased flexibility for how they spend their money, they will be held accountable for how they meet performance standards. If they don't meet those standards, he said, they will be made to spend money in the areas where they are underperforming.

An unlikely ally

While responses continue to roll in from advocacy groups and lawmakers alarmed by the funding cuts, several notable people called in to Mica's press event to thank him for the new proposal. One of them was L.A. Mayor Antonio Villaraigosa, a champion of transit investment. He thanked Mica for "listening to the 113 mayors who have gotten behind the expansion of TIFIA."

"Your proposal to raise the budget authority of TIFIA to a billion dollars goes beyond even what many of us had talked about early on," Villaraigosa said, "and we think it's exactly where it needs to be."

That's a useful high-profile endorsement for Mica from a pro-transit Democrat. Still, it's unlikely the mayor will support Mica's plan over Boxer's, which also includes America Fast Forward, another plan supported by Villaraigosa to increase federal leveraging of private funds.

Cross-posted at Streetsblog Capitol Hill.

All of this, I know, is obvious. But when it comes to rail transportation, this formula has been avoided, especially in the U.S. The owner of railroad tracks usually is also the operator of trains along them. When other operators want to move their own trains in, conflicts typically erupt.

The frequent disagreements about acceptable service levels between national rail operator Amtrak and freight railroads on tracks that the latter owns (and which it isn't very happy to share) are indicative of this problem. But these disagreements are not irreconcilable.

Indeed, an infrastructure owner that is able to arbitrate between competing operators could be more effective in producing efficient service for everyone than might be an owner-operator, which discriminates against other operators.

In this context, last week's revealing of House Transportation and Infrastructure Committee Chairman John Mica's (R-FL) plan for the Northeast Corridor raises a number of interesting questions. Convinced of the value of private sector competition and promoting a pull-out of the federal government from every public service imaginable, Mr. Mica has submitted a proposal that attempts to re-imagine the Northeast Corridor, Amtrak's flagship route and the nation's most-traveled intercity rail line, as a place where, fundamentally, the rules of the road—but not the railroad—could apply.

The bill (draft text) would force Amtrak to abandon its control of (much of) the Northeast Corridor between Washington and Boston, handing it over to the Department of Transportation, which in turn would lease it to an "Executive Committee."

Amtrak would have to give up all of its assets and it would lose federal funding. The Committee, in charge of infrastructure and setting pricing policies, would then engage a public-private partnership (PPP) with a private group, which would commit to upgrading the line and then operating trains to offer two-hour trips between New York and Washington and 2h30 between New York and Boston—within ten years, twenty years more quickly than Amtrak has said it would be able to make roughly the same improvements.

Mr. Mica also claims that this could be done at a cheaper price than Amtrak's $117 billion proposal.

Outside of the Northeast, states would have to offer their rail corridors to competitive bidding; current subsidies to Amtrak would simply be redistributed to the winners of those operations bids.

Despite the wide-ranging proposed effects of the bill as summarized, the manner in which any of this would be implemented remains incredibly unclear. How would intercity rail operators interact with the freight and commuter railroads that also use the tracks, in the Northeast and elsewhere? If a PPP were implemented, how much would the government agree to commit to pay for improvements?

Unfortunately, the bill would not provide a realistic way to promote true operational competition. Nor does it would it offer a promise of actual federal support to fund an upgrade of the corridor, which seems unlikely to be sponsored by private entities alone. Most problematic would be the transfer of authority over the line's management to the currently non-existant Executive Committee, whose ability to make decisions about rail properties has yet to be tested, let alone proven.

Fortunately, the proposal is unlikely to make it through the Senate, where Democrats and other Republican supporters of Amtrak are likely to prevent the bill from passing even if it makes it through the House. The American intercity rail system and the governance bodies that oversee it at the federal and state levels are too underdeveloped to be able to guarantee that this semi-privatization wouldn't be a disaster.

But Mr. Mica's bill does articulate a number of policy changes that could play an important role in shoring up passenger service in the Northeast. The status quo, in which Amtrak operates relatively infrequent and slow passenger trains within the nation's most important megaregion, certainly is not ideal. If managed appropriately, the separation of track ownership and line operations could allow for a situation in which multiple operators offer competing services along the same routes, just as Megabus and Bolt Bus compete for the most customers on I-95.

In mainland Europe, E.U. regulations have mandated that national rail companies like France's SNCF or Germany's DB allow other operators (in many cases, SNCF and DB affiliates) to run trains between similar destinations. Though I am not convinced that this will produce universally positive results, it will at least likely result in lower fares for customers on the most heavily trafficked rail corridors.

And focusing on the most-used lines is clearly Mr. Mica's goal; according to the bill, the second-highest stated priority for potential investors are "activities that benefit the greatest number of passengers" (just after safety). Amtrak's current policies do not exactly fit that bill since they are designed to push lower-income individuals (like myself) onto slower and less comfortable intercity buses.

Yet the Mica proposal would not produce true competition in rail operations. It would encourage competition in rail operations contracts. Rather than invest in the infrastructure and then open up the rights to use tracks, the PPP structure as proposed would be a build-operate-maintain system in which one private group would invest in improvements and then have control over operations, which it would perform itself.

Mr. Mica has repeatedly referred to Amtrak as a "Soviet-Style" system because it has a monopoly over its services, but it is hard to see how a PPP extended over a long contract would be any different, except that it would charge even higher prices to make up for the initial cost of capital improvements and—even worse—it would be literally banned from cross-subsidizing other services with the profits, according to the proposed bill. Is this in the public interest?

The biggest question of all, though, is whether Mr. Mica is in complete denial about the extent of either the private sector's ingenuity or their collective willingness to invest in public infrastructure. While it may sound nice, asserting that corporations can rebuild the Northeast Corridor in 10 years at a far lower cost to the taxpayers than Amtrak has proposed could is a stretch. And even a $50 billion upgrade would be larger than any single private investment in infrastructure ever in the U.S. What evidence does Mr. Mica have that a plan like this could move forward?

Cross-posted on The Transport Politic.