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Congress Should Stop Funding Transit ‘New Starts’

Randal O’Toole

Congress should follow the proposal in President Trump’s
2018 budget blueprint to stop funding new projects under the
Federal Transit Administration’s capital investment program,
sometimes known as “New Starts,” and its cousin,
“Small Starts.” Created in 1991, this program has
funded dozens of light-rail, heavy-rail (elevated trains &
subways), commuter-rail and streetcar projects.

This program was a mistake from the beginning, as rail transit
is an obsolete technology that makes no sense outside of New York
City, the only place in the nation with the population and job
densities that require rail transport. Instead of improving
transportation, the only real beneficiaries of New Starts and Small
Starts are rail contractors and railcar manufacturers.

Since 1991, the federal government has spent about $70 billion
(in today’s dollars) on New/Small Starts. To be eligible for
this money, local transit agencies must put up matching funds and
agree to pay to operate and maintain the rail lines. The result has
been rapidly rising construction costs and growing maintenance
backlogs, putting major burdens on local taxpayers.

To stop wasting money on
obsolete transportation, Congress should end appropriations to new
capital improvement transit projects.

In exchange for these high costs, the number of annual transit
rides taken by urban residents has declined 10 percent. One reason
is that new rail lines are so costly that transit agencies are
often forced to cut bus service and raise fares.

Los Angeles, for example, started planning and building rail
transit in the mid-1980s. By 1995, the region had opened several
expensive rail transit lines. To pay for these lines, it reduced
bus service, and total transit ridership fell by 17 percent.

The NAACP sued Los Angeles’ transit agency for building
rail into white neighborhoods while it let transit to minority
neighborhoods decline. The court ordered the agency to restore bus
service for 10 years, which restored ridership to its mid-1980
levels. But when the court order expired, Los Angeles began cutting
bus service to pay for new rail lines, and ridership has again

This pattern has been repeated in many regions. While not all
cities that built rail have seen total ridership fall, most have
seen declines in per capita ridership. Atlanta, Baltimore, Buffalo,
Dallas, Houston, Los Angeles, Norfolk, Phoenix, St. Louis, and
Sacramento are among the cities that have received New Starts funds
and have seen both per capita transit ridership and transit’s
share of commuting decline since they began building rail

To make matters worse, New Starts encourages transit agencies to
get more federal dollars by planning increasingly expensive rail
lines. In the early 1990s, new light-rail construction costs
averaged $40 million per mile in today’s dollars. Today, they
average more than $160 million per mile.

Seattle just completed a light-rail line that cost $626 million
per mile, and Los Angeles is planning one that will cost close to
$1 billion per mile. No one in the transit industry seems to be
bothered by these ridiculous costs.

To gain support for such expensive projects, advocates claim
rail transit relieves congestion. Yet light rail, streetcars, and
commuter rail usually increase congestion, both because the first
two occupy lanes once open to automobiles and because cities give
rail priority over cars at traffic lights. The traffic analysis for
Maryland’s Purple Line, for example, predicts that it will
increase the time people waste in traffic by 35,000 hours per

Rail transit is obsolete because buses can move more people,
faster, and more safely than most rail lines at far lower startup
and operating costs. Buses may be smaller than railcars, but they
can operate far more frequently. The Washington Metro can run just
28 trains per hour, and most light-rail lines can safely run only
20 trains per hour, but bus-rapid transit lines can easily move
more than 250 buses per hour. Outside of New York City, no place in
America needs more capacity than buses can provide.

Unlike other federal transit programs, new/small starts require
deficit spending out of general funds, not gas taxes. To stop
wasting money on obsolete transportation, Congress should end
appropriations to new capital improvement transit projects.

is a senior fellow at the Cato Institute and author of
“Gridlock: Why We’re Stuck in Traffic and What to Do About It.”