Should MO create a Competitve Multimodal Transportation Grant Program to fund transit?

dollar-sign-wallpaper-7St. Louis leaders have proposed a range of transportation options for the region, but without a means to pay for the projects, public transportation in the region has no means for growth.  Therefore, CMT has made finding transit funding solutions “job 1” for 2015 and will be highlighting funding insights from other places in the country.

One funding mechanism tried in other states is called  a “Competitive Multimodal Transportation Grant.”  These grants were created with the understanding that local leaders best know their community’s transportation needs, but they have rarely had access or control of federal or state transportation dollars.  Competitive Multimodal Transportation Grants address this challenge by “directing a share of state transportation funds toward local and regional priorities.  These grants bring competition, merit, accountability, transparency, and greater local control to a process that potentially could lack these qualities.”

Three states have funded local projects using competitive multimodal grant programs – Virginia, Pennsylvania, and Oregon.  In Virginia, the state legislature placed congestion mitigation as the number one criteria for the whole state, but funding has often gone to its most congested and densely developed regions.  This competitive grant process now uses different criteria for different regions, allowing the state to respond to particular regional needs.  In Oregon, their criteria specifies that 10% of the programs funds go to each of its 5 geographic regions to address this challenge.

Proposals are evaluated on broad criteria like return on investment, amount of outside funding leveraged, improved job access, etc.  These funds allow states to respond to constituent needs while selecting projects that meet the needs of the state.  Additional benefits of this funding strategy include the competitive grant process which requires applicants to articulate clearly defined and measurable goals that the public can evaluate.  This funding strategy also expands political support because all constituents can see their priorities in the competition and it gives local leaders the ability to apply for funding and galvanize support for funding increases.

Delving further, Oregon created the Connect Oregon program in 2005 to fund public and private multimodal projects that included air, marine, rail and public transportation projects.  The program is funding by lottery-backed bonds.  In the first five ConnectOregon funding cycles, 528 applications were submitted and 239 projects received $482 million in grant funding.  The largest award was $6 million and the smallest was $16,000.  Applications were assessed on readiness for construction, economic benefit, and value in linking transportation modes.  According to surveys of recipients after the fact, benefits of the program include reduced transportation costs for Oregon businesses, improved access to jobs and sources of labor, economic benefits, and critical transportation linkages.

In Pennsylvania, the state raised transportation revenue through Act 89, and dedicated a portion of the funds raised each year to a statewide multimodal grant program.  This legislation directed the PA Department of Transportation to become a truly multimodal agency that promoted coordinated planning and implementation to ensure greatest return on investment.  The funding is then split between the Pennsylvania Department of Transportation (PennDOT) and the Department of Community and Economic Development (DCED), and both programs are able to fund projects ranging from $100,000 to $3 million.  Applicants are required to provide a 30% match and private entities can apply and win funding, which helps to bring private money into transportation improvements in the state.  The PennDOT fund seeks to improve freight and passenger mobility, maximizing the benefits of capital investment, promoting safety, adn spurring economic development through transportation improvements.  The DCED funds projects for transit oriented development and coordinating land use with transportation assets.  The first round of awards totals $83 million to fund a collection of roadway, freight and passenger rail, aviation, port and waterway, bicycle and pedestrian safety, and others.

This is just one of many creative financing mechanism that states are using to help move transportation initiatives forward across the country.  As announced last month, CMT has partnered with Transportation for America to assess the range of funding programs that might be applicable to the St. Louis region, and perhaps a Competitive Multimodal Transportation Grant would be one strategy we could consider.

Read about the CMT Funding Study here.

Article source:  “Capital Ideas, Raining Money for Transportation Through Innovative State Legislation,” by Transportation for America.  Released in 2014.