NCPA - National Center for Policy Analysis

Why Congress Should Abolish the New Starts Program

July 1, 2013

In 1991, Congress created the New Starts program. The program is the federal government's primary financial resource for supporting locally planned, implemented and operated major transit capital investments. Congress directed the Federal Transit Administration (FTA) to ensure each grant be "justified based on a comprehensive review of its mobility improvements, environmental benefits, cost effectiveness and operating efficiencies." In 2012, Congress added "congestion relief" and "economic development effects" to this list, but dropped "operating efficiencies," says Randal O'Toole, a senior fellow with the Cato Institute.

New Starts should be abolished. Here's why:

  • Many New Starts projects reduce transit mobility because transit agencies sacrifice bus service to low-income neighborhoods, where such mobility is needed, in order to deliver rail transit to middle-income neighborhoods, where such mobility is merely an amenity.
  • Planning documents for many New Starts projects predict that they will increase congestion by taking up more roadway space, disrupting traffic signal coordination, or increasing queues at park-and-ride stations.
  • Planning documents often admit new rail lines will use more energy and generate more air pollution than the cars they take off the road. Other plans do not account for increasing automobile energy efficiencies or the effects of congestion on energy consumption and air pollution.
  • The Bush administration attempted to use the cost-effectiveness requirement to place an upper limit on project costs, but the transit lobby has persuaded the Obama administration and Congress to effectively eliminate this criterion altogether.
  • Numerous projects are far from operationally efficient because they increase operating costs without improving transit service. The transit lobby persuaded Congress to drop this criterion in 2012.
  • Claims that rail transit promotes economic development are contradicted by the FTA's own research.

Urban transit funds should come from local taxpayers. Congress should distribute all transit funds using formulas just like most funds for highways and buses are distributed today. This would reduce or eliminate incentives for transit agencies to build expensive systems when more cost effective systems would work just as well.

Source: Randal O'Toole, "'Paint Is Cheaper Than Rails': Why Congress Should Abolish New Starts," Cato Institute, June 19, 2013.


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