Federal Transit Programs:
Federal Transit Administration Has Opportunities to Improve Performance Accountability
GAO-11-54: Published: Nov 17, 2010. Publicly Released: Nov 17, 2010.
Public demand and federal funding for transit have grown in recent years, yet most of this funding is not tied to performance. As Congress prepares for reauthorization of the federal surface transportation programs, GAO was asked to report on (1) the extent to which federal transit programs use performance information in making decisions about funding distribution and in evaluating the programs' effectiveness; (2) mechanisms for making these programs more performance based, and strategies for supporting their successful implementation; and (3) how selected U.S. and foreign transit agencies have used performance measurement in their planning and decisions, and their views on the federal role in transit. To do so, GAO analyzed legislation, federal documents, and literature; interviewed federal officials and transit experts; and conducted semistructured interviews with selected transit agencies using criteria that, for U.S. agencies, covered a variety of regions and population sizes and, for foreign agencies, multiple transit modes and English language capability.
Some federal transit programs distribute funds based partly on performance, but opportunities to improve grant recipients' performance accountability remain. Of the eight transit programs GAO reviewed--which represent 97 percent of total federal transit grants in fiscal year 2010 (excluding funds provided under the American Recovery and Reinvestment Act)--two are generally funded by congressional direction, while the remaining six are funded through legislatively defined grant formulas. Federal funding for the two nonformula programs GAO reviewed--the New Starts Program and the Bus and Bus Related Equipment and Facilities Program--is awarded in part according to performance. A small percentage of federal transit funding for the six formula programs is apportioned based on performance--according to GAO's analysis, about 5 percent, on average, of fiscal year 2010 funding. FTA does not, in general, analyze fully or use the performance data it collects from transit agencies to evaluate the effectiveness of its transit grant programs; thus, FTA is missing a valuable opportunity to evaluate the end results of its program activities and programs' funding formulas. GAO identified three performance accountability mechanisms for making federal transit programs more performance based, including providing financial rewards or penalties/sanctions, increasing or decreasing program flexibility as a performance incentive, and recognizing entities that achieve certain performance goals. These mechanisms have both potential advantages--most notably, they can encourage improved performance and help agencies make sound decisions when allocating limited funds--and potential disadvantages that can produce inequitable results or burden transit agencies with requirements to gather, maintain, and analyze data. GAO also identified several key strategies that can support the use of these mechanisms and mitigate their disadvantages, such as ensuring that mechanisms are of sufficient value and that appropriate measures are selected, among others. However, without FTA analysis of the appropriateness, feasibility, and potential impact of using various transit performance mechanisms, Congress may lack information to determine whether and how these mechanisms could be used to make transit funding more performance based as it prepares for the upcoming surface transportation reauthorization. Transit agencies that GAO interviewed use performance measurement to varying degrees, but they face challenges in linking performance with planning and decision making. All of these agencies measure performance in certain categories, such as ridership and on-time performance, but the extent to which they measure it in others--such as environmental impact, energy usage, and economic development--varies widely. Transit agency officials reported that measuring performance presents challenges, in part because it can be difficult to obtain relevant data and develop a sound methodology. They also said that linking performance to planning and decision making is challenging because of either limited funding or political priorities. These transit agencies and other experts suggested a variety of changes to the federal role in transit, including increasing investment in existing transit infrastructure; developing federal transit program goals that generally address broader issues, such as encouraging a shift from automobiles to public transit; and promoting livable communities around transit systems. The Federal Transit Administration (FTA) should (1) report to Congress on options for adding performance accountability mechanisms to transit programs to ensure efficient and effective federal transit programs and (2) further analyze and use transit agency data, when applicable, for evaluating federal transit program performance. DOT reviewed a draft of this report, provided technical clarifications, and said it would consider our recommendations.
Recommendations for Executive Action
Status: Closed - Not Implemented
Comments: FTA requested that the recommendation be closed as not implemented citing various performance metrics in place to address existing requirements and various reporting mechanisms to Congress in which the agency reports on performance measures. Although we recognize that FTA has incorporated performance-based principles into some of its formula grant programs to allocate funding, we found that FTA did not use the performance data it collected to evaluate the effectiveness of its formula grant programs and therefore recommended that FTA study and report to Congress on options for adding performance accountability mechanisms to transit grant programs preferably in time to be considered during the reauthorization of federal transit programs. As FTA did not conduct such a study and the authorization of these programs has already occurred, we agree and are closing this recommendation as not implemented. However, as part of the reauthorization of federal transit programs, DOT will be required to report to Congress in 2017 on progress states and other grantees have made in achieving established performance targets, including performance measures established for transit agencies.
Recommendation: To enhance the performance of federal transit programs, the Secretary of Transportation should direct the FTA Administrator to study and report to Congress on options for adding performance accountability mechanisms to transit grant programs. FTA should strive to provide such information in time to be considered during the reauthorization of the federal transit programs.
Agency Affected: Department of Transportation
Comments: FTA requested that the recommendation be closed as not implemented citing research the agency has funded on transit performance measures and its FY12 budget request recommending a new Bus and State of Good Repair program that will include performance metrics to reduce the capital asset backlog for transit properties and measure progress toward reducing the backlog. Transit systems receiving funds from this program will be required to report on an annual basis but because the program is subject to receiving appropriations, FTA recommends the recommendation be closed. While we recognize that some transit programs have performance accountability mechanisms, we believe that provisions in the most recent authorization of transit programs requiring the establishment of performance metrics for transit programs are still being established and therefore it is too soon to tell how FTA might use this information to evaluate its programs. Specifically, FTA is required to develop rules on transit asset management and transit safety plans, as well as establish performance criteria for its new safety responsibilities and establish performance measures for state of good repair, among other things. In addition, direct recipients of public transportation federal funding assistance will be required to report FTA on progress in achieving transit targets. As these requirements are still under development, we are keeping this recommendation open until progress against these requirements can be assessed.
Recommendation: To improve FTA's ability to determine the extent to which transit grants, current formula incentives, and FTA program activities have had a positive effect on local transit agency performance--and to the extent that FTA finds current data sources to be appropriate and reliable for such purposes-- the Secretary of Transportation should direct the FTA Administrator to further analyze and use data submitted to FTA by local transit agencies. As part of this analysis, FTA may want to identify and evaluate, when applicable, (1) the extent to which transit grant programs are accomplishing their established goals; (2) the areas of performance in which FTA should concentrate its program activities to increase the performance of local transit agencies and the federal transit program in general; and (3) the extent to which formula incentives and other performance accountability mechanisms have influenced the activities and performance of local transit agencies.
Agency Affected: Department of Transportation