- Federal loans would count as share of cost under grant project
- Transportation Democrats criticize White House approach
Critical rail and bus rapid transit projects could be collateral damage in the Trump administration’s crusade against the Gateway Project, Democratic appropriators said in response to a letter by the agency overseeing transit grants.
The Federal Transit Administration sent a letter late Friday advising Capital Investment Grants applicants of the FTA’s interpretation of financial requisites that projects need to meet to qualify or be highly rated for a grant: It is the same position the agency has been applying to Gateway’s application. Gateway is a project to build new Hudson River bridge and tunnel crossings between New York and New Jersey, in one of the nation’s busiest transportation corridors.
FTA acting Administrator K. Jane Williams said the agency considers Transportation Department loans “in the context of all federal funding sources requested by the project sponsor when completing the [Capital Investment Grant] evaluation process,” and “not separate from the Federal funding sources.”
“Strong local financial commitment and stable, reliable, and dependable non-funding sources are necessary for projects to do well in the [Capital Investment Grant] program,” the letter said.
Congressional appropriators tasked with funding transportation programs clashed with Transportation Secretary Elaine Chao over this very issue during hearings this spring. Now top appropriators say the FTA letter puts projects across the country at risk.
“I’m concerned that the Trump Administration’s political maneuvers to scuttle the Gateway Project in New York will soon cause collateral damage to vital transit projects across the country,” Rep. David Price (D-N.C.) told Bloomberg Government in a statement. Price is the ranking member on the Transportation-HUD Appropriations Subcommittee.
The FTA’s “flawed interpretation of the use of federal loans for transit grants” is “deeply disturbing and disappointing,” Rep. Mike Quigley (D-Ill.) said in a statement to Bloomberg Government. Quigley is one of Price’s subpanel members.
As of early May, about 50 projects were in the pipeline awaiting full-funding grant agreements under the Capital Investment Grant program, which includes New Starts grants and Small Starts grants. The administration has twice proposed in budgets eliminating the transit grant programs entirely.
The administration has repeatedly called on Gateway states to offer more local funding, in keeping with President Donald Trump’s objective of increasing non-federal shares of investment in infrastructure, much to the ire of congressional appropriators and the New York and New Jersey delegations.
The states involved in the Hudson River project estimate that they are contributing 50 percent of the cost, but Chao told Congress she counts the federal loans as federal, not local, contributions, and therefore the states are contributing closer to 20 percent.
“Even though they have to pay that money back, you don’t consider that a state contribution. I just don’t understand that,” Sen. Chris Murphy (D-Conn.) said during an April exchange with Chao.
The Friday letter makes explicit this policy and applies it to all potential projects.
If federal loans no longer count as part of the local share of a project cost, then many of the projects in the pipelines for federal transit grants will be in jeopardy of not qualifying for the grants.
“While FTA should work with grantees to ensure federally funded projects are completed on time and on budget, the agency must provide the Appropriations Committee with additional information about any proposed changes to the Capital Investment Grants review process,” Price said.
“I believe attempts to choke the project pipeline under the guise of fiscal rectitude or to politicize the process will be met with bipartisan opposition in Congress,” he said.
To contact the reporter on this story: Shaun Courtney in Washington at firstname.lastname@example.org