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APTA Primer on Transit Funding The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users, and Other Related Laws, FY 2004 through FY 2009, American Public Transportation Association, August, 2009 This report describes funding provisions of SAFETEA-LU, extension acts to TEA 21, and related laws that provide for transit funding. We provide no descriptions about laws not related to funding and provisions of regulations. Provisions of the following laws authorize and control transit funding:

  • SAFETEA-LU authorizes the levels of transit and highway funding from FY 2005 through FY

2009 and describes the structure for newly created funding programs and changes to existing programs.

  • TEA 21 extension acts extended the TEA 21 authorization period from October 1, 2003 through

August 14, 2005. The TEA 21 extension acts authorized the transit program for FY 2004 and superseded for FY 2005 by SAFETEA-LU when it became law on August 10, 2005.

  • Title 49, Chapter 53 of the United States Code, Mass Transportation, contains the permanent

provisions of law for administering the federal transit program.

  • Title 23 of the United States Code, Highways, contains the permanent provisions of law for

administering the federal highway program. SAFETEA-LU also modified some of those provisions.

  • The Internal Revenue Code of 1986, Subtitle I, Trust Fund Code, contains provisions governing

collection and use of motor fuel taxes for highway and transit programs. SAFETEA-LU extended and modified the Internal Revenue Code.

  • Previous authorizing acts indicated in the following text contains provisions continued in

SAFETEA-LU but not codified in 49 USC.

  • Funding for transit was included the American Recovery and Reinvestment Act of 2009.

  • Funding eligible for transit uses was included in Department of Homeland Security

appropriations from 2004 through 2009. Annual budget and appropriation actions affect transit spending. Budget laws determine an overall level for transportation spending each year and appropriation laws specify the funding level for each transportation program and the purposes for which some funds may be used. Many other federal laws include provisions that affect the operation of transit services and govern the use of federal funds. These laws do not provide funding for transit and thus not described. http://www.apta.com/gap/policyresearch/Documents/Primer_SAFETEA_LU_August_2009_Updat e.pdf

Should Urban Transit Subsidies Be Reduced? Ian W.H. Parry and Kenneth A. Small, Resources for the Future, July 2007 This paper derives intuitive and empirically useful formulas for the optimal pricing of passenger transit and for the welfare effects of adjusting current fare subsidies, for peak and off-peak urban rail and bus systems. The basis of the formulas Implementation is on a detailed estimation of parameter values for the metropolitan areas of Washington (D.C.), Los Angeles, and London. Our analysis accounts for congestion, pollution, and accident externalities from automobiles and from transit vehicles; scale economies in transit supply; costs of accessing and waiting for transit service as well as service crowding costs; and agency adjustment of transit frequency, vehicle size, and route network to induced changes in demand for passenger miles. The results support the efficiency case for the large fare subsidies currently applied across mode, period, and city. In almost all cases, fare subsidies of 50 percent or more of operating costs are welfare improving at the margin, and this finding is robust to alternative assumptions and parameters. The paper provides a detailed report of positive effects across the board from increased transportation subsidies. Mathematical formulas illustrate the major findings. Documented resource list included along with a Chart of 20 largest US transit authorities subsidies at end of report. http://www.rff.org/RFF/Documents/RFF-DP-07-38.pdf

Promoting Public Transportation: A Comparison of Passengers and Policies in the U.S. and Germany, Ralph Buehler, Ph. D., School of Public and Urban Affairs, VA., Technical Institute Paper not dated but resources as current as 2008. This report compares the U.S and German transportation systems and the amount of farebox recovery from subsidies. The report provides a


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