SAFETEA-LU also made changes to the New Starts program,  including changes to its evaluation and rating process. 1). 2). FTA has also subsequently introduced a separate eligibility category  within the Small Starts program for “Very Small Starts” projects. Small  Starts projects that qualify as Very Small Starts are simple, low-cost  projects that FTA has determined qualify for a simplified evaluation and  rating process. 3). FTA Evaluated and Rated 14 New Starts Projects, and Recommended Funding for 10 Projects

FTA’s Annual Report on New Starts: Proposed Allocations of Funds for  Fiscal Year 2008 (annual report) identified 19 New Starts projects in  preliminary engineering and final design. FTA recommended 10 New Starts projects for funding. FTA is considering different ideas on how to improve the New Starts  process, some of which may address the concerns identified by project  sponsors. The Number of Projects in the New Starts Pipeline Has Decreased, and the Types of and Funding for Projects Have Changed

Since the fiscal year 2001 evaluation cycle, the number of projects in the  New Starts pipeline—which includes projects that are in the preliminary  engineering or final design phases—has decreased by more than one-half,  from 48 projects in the fiscal year 2001 evaluation cycle to 19 projects in  the fiscal year 2008 evaluation cycle. FTA and Project Sponsors Attributed the Decrease in the New Starts Pipeline to Different Factors

FTA and project sponsors identified different factors for the decrease in  the New Starts pipeline. FTA officials cited their increased scrutiny of  applications to help ensure that only the strongest projects enter the  pipeline, and said they had taken steps to remove projects from the  pipeline that were inactive, not advancing, or did not adequately address  identified problems. FTA officials told us that project sponsors are generally aware  of FTA’s efforts to better manage projects in the pipeline. The most  common reasons cited by project sponsors were that the New Starts  process is too complex, costly, and time-consuming:    Complexity and cost of the New Starts process: The majority of project  sponsors we interviewed told us that the complexity of the requirements— including those for financial commitment projections and travel forecasts,  which require extensive analysis and economic modeling—creates  disincentives to entering the New Starts pipeline. The lengthy  nature of the New Starts process is due, at least in part, to the rigorous and  systematic evaluation and rating process established by law—which, as we  have previously noted, could serve as a model for other transportation  programs. According to  the project sponsors, they will likely seek New Starts funding for almost  three-fourths (72 percent, or 101) of these 141 planned New Starts, Small  Starts, and Very Small Starts projects. Although the project sponsors we surveyed indicated  that they were considering a range of alternative project types in their  planning, the most commonly cited alternatives were bus rapid transit and  light rail. Of the  ongoing Small Starts and Very Small Starts projects for which respondents  indicated they would be requesting New Starts funding, project sponsors  definitively reported that they would have sought New Starts funding for  only about one-quarter of those ongoing projects if the Small Starts  program, including the eligibility category for Very Small Starts projects,  had not been established. Project Sponsors Would Like FTA to Further Streamline the Small Starts Program

In implementing the Small Starts program, FTA has taken steps to  streamline the application and evaluation and rating processes for smaller- scale transit projects, as envisioned by SAFETEA-LU. In reviewing the Small Starts application process requirements, we also  found that the application is not always tailored for Small Starts applicants  and, in several instances, requests duplicate information. Appendix I: Scope and Methodology

To address our objectives, we reviewed the Federal Transit  Administration’s (FTA) guidance on the New Starts and Small Starts  programs; the Advanced Notice of Proposed Rule Making for Small Starts;  and the provisions of the Safe, Accountable, Flexible, Efficient  Transportation Equity Act: A Legacy for Users and prior law that address  the New Starts program. Mass Transit: Status of New Starts Transit Projects With Full Funding  Grant Agreements.
Why GAO Did This Study

Through the New Starts program, the Federal Transit Administration (FTA) identifies and recommends new fixed-guideway transit projects for funding. The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) created a separate program, commonly called Small Starts, which is intended to offer a streamlined evaluation and rating process for smaller-scale transit projects. FTA subsequently introduced a separate eligibility category within the Small Starts program for "Very Small Starts" projects. These are simple, low-risk projects that qualify for a simplified evaluation and rating process. SAFETEA-LU requires GAO to annually review FTA's New Starts process. This report presents information on (1) FTA's fiscal year 2008 funding recommendations, (2) the extent to which the New Starts pipeline has changed over time, and (3) future projected trends for the New Starts and Small Starts pipelines. To address these objectives, GAO surveyed 215 project sponsors--78 percent of which responded--and interviewed FTA officials, 15 project sponsors, and 3 industry groups.

What GAO Found

For the fiscal year 2008 evaluation cycle, FTA recommended to Congress 10 New Starts and 4 Small Starts projects for funding. The administration's budget request of $1.40 billion is primarily allocated to New Starts projects with existing and pending full funding grant agreements. SAFETEA-LU made several changes to the New Starts evaluation and rating process, which FTA is implementing. Since the fiscal year 2001 evaluation and rating cycle, the New Starts pipeline--that is, projects in the preliminary engineering and final design phases--has changed in size and composition, responding to a variety of factors. The number of projects in the New Starts pipeline has decreased by more than one-half, and the types of projects in the pipeline have changed, with bus rapid transit replacing commuter or light rail as the most common type of project. FTA officials attributed the decrease in the number of projects to FTA's increased scrutiny of applications to help ensure that only the strongest projects enter the pipeline, and to FTA's efforts to remove projects from the pipeline that were not advancing or did not adequately address identified problems. Project sponsors that GAO interviewed cited other reasons for the pipeline's decrease, including the complexity, lengthiness, and cost of the New Starts process. The lengthy nature of the New Starts process is due, in part, to the rigorous and systematic evaluation and rating process established by law--which GAO has previously noted could serve as a model for other programs. Other reasons cited by project sponsors for the decrease in the pipeline include finding alternative sources of funding or opting not to apply because they realize their projects are unlikely to receive funding. FTA is considering different ideas on how to improve the New Starts process, some of which may address the concerns identified by project sponsors. Despite these concerns, GAO's survey of project sponsors indicated future demand for New Starts funding. Project sponsors reported having 141 planned New Starts, Small Starts, and Very Small Starts projects and will likely seek New Starts funding for almost three-fourths of these projects. Of these planned projects, project sponsors indicated that they intend to seek New Starts funding for 57 New Starts projects, 30 Small Starts projects, and 14 Very Small Starts projects. Project sponsors GAO surveyed also reported considering a range of alternative project types in their planning. Although project sponsors expressed appreciation for the creation of the Small Starts program, noting it filled a funding gap, they said the Small Starts application process is not tailored to the Small Starts program and is time-consuming, costly, and duplicative. GAO also found that the application is not always tailored for Small Starts applicants and, in several instances, requests duplicative information. FTA officials acknowledged that the Small Starts application process could be further streamlined, and they are working to decrease the burden.