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Report to the Chairman, Subcommittee on Transportation, Housing and 
Urban Development, and Related Agencies, Committee on Appropriations, 
U.S. House of Representatives: 

United States Government Accountability Office: 
GAO: 

September 2009: 

Affordable Housing in Transit-Oriented Development: 

Key Practices Could Enhance Recent Collaboration Efforts between DOT- 
FTA and HUD: 

GAO-09-871: 

GAO Highlights: 

Highlights of GAO-09-871, a report to the Chairman, Subcommittee on 
Transportation, Housing and Urban Development, and Related Agencies, 
Committee on Appropriations, U.S. House of Representatives. 

Why GAO Did This Study: 

The federal government has increasingly focused on linking affordable 
housing to transit-oriented developments—compact, walkable, mixed-use 
neighborhoods located near transit—through the Department of Housing 
and Urban Development’s (HUD) housing programs and the Department of 
Transportation’s (DOT) Federal Transit Administration’s (FTA) transit 
programs. GAO was asked to review (1) what is known about how transit-
oriented developments affect the availability of affordable housing; 
(2) how local, state, and federal agencies have worked to ensure that 
affordable housing is available in transit-oriented developments; and 
(3) the extent to which HUD and FTA have worked together to ensure that 
transportation and affordable housing objectives are integrated in 
transit-oriented developments. To address these issues, GAO reviewed 
relevant literature, conducted site visits, and interviewed agency 
officials. 

What GAO Found: 

Characteristics of transit-oriented developments can increase nearby 
land and housing values, however determining transit-oriented 
development’s effects on the availability of affordable housing in 
these developments are complicated by a lack of direct research and 
data. Specifically, the presence of transit stations, retail, and other 
desirable amenities such as schools and parks generally increases land 
and housing values nearby. However, the extent to which land and 
housing values increase—or in the rare case, decrease—near a transit 
station depends on a number of characteristics, some of which are 
commonly found in transit-oriented developments. According to transit 
and housing stakeholders GAO spoke with, higher land and housing values 
have the potential to limit the availability of affordable housing near 
transit, but other factors—such as transit routing decisions and local 
commitment to affordable housing—can also affect availability. 

Few local, state, and federal programs are targeted to assisting local 
housing and transit providers develop affordable housing in transit-
oriented developments. The few targeted programs that exist primarily 
focus on financial incentives that state and local agencies provide to 
developers if affordable housing is included in residential 
developments in transit-oriented developments. However, GAO found that 
housing developers who develop affordable housing in transit-oriented 
developments generally rely on local and state programs and policies 
that have incentives for developing affordable housing in any location. 
HUD and FTA programs allow local and state agencies to promote 
affordable housing near transit, but rarely provide direct incentives 
to target affordable housing in transit-oriented developments. 

Since 2005, HUD and FTA, and more recently DOT, have collaborated on 
three interagency efforts to promote affordable housing in transit-
oriented developments including (1) an interagency agreement, (2) a HUD-
FTA action plan, and (3) a new DOT-HUD partnership. While these 
interagency efforts have produced numerous strategies, local housing 
and transit officials told GAO that these strategies had little impact, 
in part, because they have yet to be implemented. However, the agencies 
have not yet developed a comprehensive, integrated plan to implement 
all efforts, and without such a plan, the agencies risk losing 
momentum. GAO has previously identified key practices that could 
enhance and sustain collaboration among federal agencies; when compared 
to these practices, GAO found that HUD, FTA, and DOT have taken some 
actions consistent with some of these practices—such as defining a 
common outcome. However, weaknesses in agency housing data and 
analytical transportation planning methods will limit these agencies’ 
ability to effectively monitor, evaluate, and report results—another 
key collaboration practice. GAO found that other collaboration 
practices, such as establishing compatible policies and procedures, 
could be taken to strengthen collaboration. Finally, without a more 
formalized approach to collaboration, including establishment of 
memorandum of agreements, these agencies may not effectively leverage 
their unique strengths. 

What GAO Recommends: 

GAO is recommending that DOT and HUD develop a plan for implementing 
interagency efforts to promote affordable housing in transit-oriented 
developments, ensure they collect sufficient data to assess the results 
of these efforts, and formalize key collaboration practices. DOT and 
HUD agreed to consider the report’s recommendations. 

View GAO-09-871 or key components. For more information, contact Dave 
Wise, (202) 512-2834 or wised@gao.gov, or Mathew J. Scirè at (202) 512-
8678 or sciremj@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Transit-Oriented Developments Can Affect the Availability of Affordable 
Housing but Conclusions Are Complicated by Limited Research and Data: 

Local, State, and Federal Affordable Housing Programs and Policies 
Support, but Generally Do Not Require, Affordable Housing in Transit- 
Oriented Developments: 

DOT, HUD, and FTA Have Collaborated on Interagency Efforts to Promote 
Affordable Housing in Transit-Oriented Developments, However, 
Implementation Has Been Limited, and Additional Steps to Enhance 
Collaboration Could Be Taken: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: Types of Locations that Could Have Transit-Oriented 
Developments: 

Appendix III: Examples of LIHTC Programs that Award Points for 
Proximity to Transit or Transit-Oriented Developments: 

Appendix IV: Comments from the Department of Housing and Urban 
Development: 

Appendix V: GAO Contacts and Staff Acknowledgments: 

Tables: 

Table 1: Examples of Federal Programs that Fund Transit Projects: 

Table 2: Examples of State and Local Affordable Housing Incentives and 
Requirements that Have Been Used in Transit-Oriented Developments but 
Are Not Specifically Designed for Use in Transit-Oriented Developments: 

Table 3: Summary of Strategies and Recommendations Made by the Three 
Interagency Efforts: 

Table 4: Eight Key Practices Federal Agencies Can Undertake to Enhance 
and Sustain Collaborative Efforts and the Extent to which DOT's, HUD's, 
and FTA's Collaboration Efforts Are Consistent with These Key 
Practices: 

Figures: 

Figure 1: Representation of a Transit-Oriented Development and Key 
Components: 

Figure 2: Infill Development, Including Some Affordable Housing Units, 
Has Replaced Vacant or Underutilized Land near the Columbia Heights 
Station in Washington, D.C. 

Figure 3: Examples of Inconsistencies in Number of HUD-Subsidized 
Housing Unit Records, 2000-2008: 

Abbreviations: 

AMI: area median income: 

CDBG: Community Development Block Grant: 

CTOD: Center for Transit-Oriented Development: 

DOT: Department of Transportation: 

EPA: Environmental Protection Agency: 

FTA: Federal Transit Administration: 

GPRA: Government Performance and Results Act: 

HUD: Department of Housing and Urban Development: 

LIHTC: Low Income Housing Tax Credit: 

PHA: public housing authority: 

QAP: Qualified Allocation Plan: 

SAFETEA-LU: Safe, Accountable, Flexible, Efficient, Transportation 
Equity Act: A Legacy for Users: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

September 9, 2009: 

The Honorable John Olver: 
Chairman: 
Subcommittee on Transportation, Housing and Urban Development, and 
Related Agencies: 
Committee on Appropriations: 
House of Representatives: 

Dear Mr. Chairman: 

Households seeking relief from high housing costs may move to areas 
with less costly housing but then find themselves further away from 
their place of employment and public transportation. Consequently, they 
can face significant increases in transportation costs and commute 
times. Such costs can particularly affect lower-income households, 
since these households are more transit dependent and have fewer 
transportation choices available. In addition, state and local 
governments, which build, operate, and maintain each region's 
transportation system, may need to accommodate more people driving 
longer distances to work, and with an increase in traffic congestion, 
will likely need to spend more money on roads. 

To combat increasing costs for both individual households and local 
governments, numerous local communities believe there is a need to 
expand housing opportunities and other amenities located near transit 
by promoting transit-oriented developments. Transit-oriented 
developments are commonly seen as compact, mixed-use (commercial and 
residential),[Footnote 1] walkable neighborhoods located near transit 
facilities--such as fixed-guideway stations.[Footnote 2] The perceived 
benefits of transit-oriented developments include reducing individual 
households' transportation costs by providing residents with walkable 
access to transit service and shopping, and reducing the investment 
needed for local governments to build and maintain roads. Officials in 
cities such as Denver and Seattle believe that promoting transit- 
oriented development will realize these benefits and can spur economic 
development. 

Some policy makers and housing experts, however, have raised concerns 
that lower-income households might not benefit from these developments. 
Specifically, they are concerned that the high demand for housing at 
transit-oriented developments will encourage developers, who typically 
seek to maximize the return on their housing investments, to primarily 
build market rate housing that may limit affordable housing 
opportunities for lower-income households.[Footnote 3] Also, housing 
stakeholders have expressed concern that existing affordable housing-- 
whether subsidized or not--presently located near transit may no longer 
be financially feasible once a transit-oriented development is built, 
thereby increasing the demand for affordable housing.[Footnote 4] 

The federal government has acknowledged the link between housing and 
transportation.[Footnote 5] For example, the Department of Housing and 
Urban Development (HUD) and the Federal Transit Administration (FTA) 
started collaborating in 2005 by funding research on expanding housing 
near transit. More recently, in separate testimonies presented in March 
2009, the Secretaries of HUD and the Department of Transportation (DOT) 
discussed the relationship between housing and transportation.[Footnote 
6] In addition, there has been an increased focus on combining the cost 
of housing and transportation as the "true" cost of housing 
affordability. However, under the current structure, the federal 
government provides significant funding to state and local governments 
to support both local affordable housing and surface transportation 
programs through separate housing and transportation departments. For 
example, HUD provides rental housing assistance through three major 
programs--housing choice vouchers, public housing, and project-based 
rental assistance; in fiscal year 2008, these programs provided rental 
assistance to about 4.75 million households and, according to HUD 
officials, paid about $31.25 billion in rental subsidies. DOT, through 
a variety of FTA programs to include the New Starts program,[Footnote 
7] has provided more than $33 billion over the last decade to help 
design, construct, rehabilitate, and modernize fixed-guideway transit 
projects throughout the country.[Footnote 8] Congress, among others, 
has raised questions about how these departments could better work 
together. In 2008, the Appropriations Committees directed HUD and FTA 
to jointly address new and better ways for promoting affordable housing 
near transit service.[Footnote 9] 

You asked us to provide information on several key questions related to 
the impact of transit-oriented development on affordable housing and 
how HUD and FTA might better work together. More specifically, this 
report addresses the following questions: 

1. What is known about how transit-oriented developments affect the 
availability of affordable housing? 

2. How have local, state, and federal agencies worked to ensure that 
affordable housing, including housing subsidized through HUD programs, 
is available in transit-oriented developments? 

3. To what extent do FTA and HUD work together to ensure that 
transportation and affordable housing objectives are integrated in 
transit-oriented developments, and what opportunities exist to enhance 
collaboration? 

To address these questions, we conducted a review of relevant 
literature, reports, studies, and our prior research. We also conducted 
11 site visits in Mesa, Phoenix, and Tempe, Arizona; Sacramento, 
California; Chicago, Illinois; Cleveland, Ohio; Jersey City and 
Hoboken, New Jersey; Portland, Oregon; Washington, D.C.; and Arlington, 
Virginia. During these site visits, we interviewed federal, state, and 
local housing and transportation officials; nonprofit housing 
organizations; and housing developers, and toured transit-oriented 
developments. We selected this nongeneralizable sample of metropolitan 
areas based on whether the metropolitan areas reported having transit- 
oriented developments, if the area had received New Starts federal 
funding for construction of a local fixed-guideway transit system, and 
geographical diversity. We also interviewed transportation, housing, 
and community development officials; housing developers; and 
representatives from various transportation and housing associations 
with experience in developing, implementing, or analyzing these issues. 
In addition, we reviewed studies and documentation on how government 
agencies and other housing and transportation stakeholder groups in 
these and other metropolitan areas and states have promoted transit- 
oriented developments. We conducted this performance audit from August 
2008 to September 2009 in accordance with generally accepted government 
auditing standards. Those standards require that we plan and perform 
the audit to obtain sufficient, appropriate evidence to provide a 
reasonable basis for our findings and conclusions based on our audit 
objectives. We believe that the evidence obtained provides a reasonable 
basis for our findings and conclusions based on our audit objectives. 
See appendix I for more information about our scope and methodology. 

Background: 

There is no single definition of transit-oriented development; however, 
research generally describes such a development as a compact, mixed- 
use, walkable neighborhood located near transit facilities. Research 
has highlighted that most transit-oriented developments are typically 
near a fixed-guideway rail station, generally encompass multiple city 
blocks up to a half-mile from a transit station, have pedestrian- 
friendly environments and streetscapes, and include high-density and 
mixed-use developments. In addition, these developments may have fewer 
parking spaces compared to more traditional developments because 
residents have easy access to transit, and thus less need for an 
automobile. Transit-oriented developments can range in both size and 
scope, with some being in suburban neighborhoods with streetcars or bus 
rapid transit systems and community-related services while others are 
located in major urban locations with light, heavy, or commuter 
rail.[Footnote 10] Transportation experts believe that transit- 
oriented developments can increase accessibility to employment, 
educational, cultural, and other opportunities by promoting 
transportation options to households, thereby increasing transit 
ridership and reducing road congestion. Figure 1 provides a graphic 
representation of a transit-oriented development, and appendix II 
provides a description of various types of such developments. 

Figure 1: Representation of a Transit-Oriented Development and Key 
Components: 

[Refer to PDF for image: illustration] 

Features (generally encompasses multiple city blocks up to a half-mile 
from a transit station): 

Transit station, such as a light rail station, that is part of a 
transportation network allows residents to access the region’s 
neighborhoods, destinations, and centers, thereby promoting transit 
use; 

Open spaces to include transit-plazas, small parks or regional open 
spaces; 

High-quality walking environments and streetscape that allow people to 
take care of some of their daily needs by walking or biking; 

Includes moderate-to-high-density mix of residential, commercial, 
employment, and civic/cultural developments; 

Includes residential buildings that can vary from small-lot single 
family/duplex/townhome units to high-rise multifamily units; 

Offers mixed use and employment developments that can vary from mid- to 
high-rise residential over commercial to low-to-high-rise 
office/commercial. 

Source: GAO. 

[End of figure] 

Planning and development of a transit-oriented development and 
affordable housing are driven largely by state and local governments, 
transit agencies, and private developers. For example, state and local 
government agencies provide many of the necessary infrastructures of 
transit-oriented developments, including transit stations, connections 
to other transportation modes, sidewalks, utilities, and other public 
amenities. Local governments also create the zoning environment, which 
may, for example, allow developers to build a mix of uses at higher 
densities. Some of the key agencies involved and their principal roles 
are summarized below. 

* State and local departments of transportation and metropolitan 
planning organizations[Footnote 11] develop transportation plans and 
improvement programs; and build, maintain, and operate transportation 
infrastructure and services.[Footnote 12] 

* Local transit agencies, such as transit authorities or transit 
operators, are responsible for building, maintaining, and operating 
transit systems. These transit systems can include fixed-guideway 
transit systems--such as light or heavy rail, and bus rapid transit-- 
ferry systems, paratransit services, and local bus service. 

* Local county and city governments, and regional councils, through 
agencies such as county or city planning departments, have control over 
land use planning, which includes zoning policies and growth management 
policies. Regional councils develop land use plans used by metropolitan 
planning organizations for transportation planning. 

In addition, state housing agencies, local governments, and private and 
nonprofit housing developers are the main stakeholders in building 
affordable housing. Some of the key agencies involved include: 

* State housing development and financing agencies provide funding for 
affordable housing through the Low Income Housing Tax Credit (LIHTC) 
program--an indirect federal subsidy used to finance the development of 
affordable rental housing for low-income households--and other state 
programs for affordable housing.[Footnote 13] 

* City and county housing departments are responsible for planning, 
developing, and funding affordable housing. In addition, local housing 
departments or agencies are required by federal law to develop local 
area housing plans.[Footnote 14] 

* Local public housing authorities (PHA), normally created by state 
law, typically manage a local region's public housing units and 
federally sponsored housing voucher programs. 

* Private for-profit housing developers and nonprofit housing 
developers, such as community development corporations, build and 
manage housing units. 

FTA provides financial and technical assistance to local and state 
public transit agencies to build, maintain, and operate public transit 
systems. FTA's New Starts program, its major capital investment program 
for new and extensions to existing fixed-guideway transit systems--a 
key element of transit-oriented developments--awards funds to 
individual projects through a competitive selection process.[Footnote 
15] Only a few systems are recommended by FTA for funding in each 
fiscal year. FTA also provides transit funding to state and local 
governments through formula grants, which are funded entirely from the 
Highway Trust Fund's Mass Transit Account.[Footnote 16] These grants 
provide capital and operating assistance to local transit agencies and 
states through a combination of five relatively large and five 
relatively smaller grant programs, which FTA distributes via formula 
grants. In addition, two programs administered by the Federal Highway 
Administration, the Surface Transportation Program and the Congestion 
Mitigation and Air Quality Improvement Program--also referred to here 
as flexible funding programs--routinely provide state and local 
transportation agencies flexibility in using funding for transit 
projects by permitting a portion of the program funding to be 
transferred for these purposes. A portion of flexible funding is 
allocated to localities and metropolitan planning organizations rather 
than states, allowing local authorities, acting through the 
metropolitan planning organization, to select projects reflecting their 
jurisdictions' priorities. Table 1 provides additional information on 
these programs. 

Table 1: Examples of Federal Programs that Fund Transit Projects: 

New Starts and Small Starts (FTA): 
Selects new fixed-guideway and fixed-guideway extensions, fixed 
guideway modernization, and certain bus-related projects for funding in 
accordance with 49 U.S.C. § 5309. Projects can include heavy, light, 
and commuter rail, and certain bus rapid transit projects. To be 
eligible for funding under New Starts, projects must, among other 
things, be justified based on a comprehensive review of mobility 
improvements, environmental benefits, economic development effects land 
use, cost effectiveness, and operating efficiencies, and supported by 
an acceptable degree of local financial commitment. Small Starts are 
evaluated against a subset of these measures including cost 
effectiveness, land use, other factors (including economic development 
impacts), and local financial commitment. 

Transit Capital Assistance (FTA): 
Provides grants to local transit agencies through a formula for 
projects that can include capital projects and associated capital 
maintenance items, planning, transit enhancements, and operating costs 
of equipment and facilities. Funding is apportioned to urbanized and 
nonurbanized areas on the basis of legislative formulas, which include 
such items as population and population density, bus revenue vehicle 
miles, bus passenger miles, fixed guideway revenue vehicle miles, and 
fixed guideway route miles. 

Congestion Mitigation and Air Quality Improvement Program (joint 
Federal Highway Administration and FTA): 
Partially funds transportation projects and programs in order to reduce 
transportation-related emissions in areas with poor air quality. To be 
eligible for funding, projects must be transportation related, in 
nonattainment or maintenance areas,[A] and reduce transportation-
related emissions. 

Surface Transportation Program (joint Federal Highway Administration 
and FTA): 
Provides funding to states and localities for projects on any federal-
aid highway--including transit capital projects and local and intercity 
bus terminals and facilities. 

Source: GAO analysis of DOT information. 

[A] Federal air quality standards, established by the Environmental 
Protection Agency, exist for certain air pollutants (knows as criteria 
pollutants). Geographic areas that have levels of a criteria pollutant 
above those allowed by the standards are called nonattainment areas. 
Areas that were previously nonattainment areas but now meet the 
standards (i.e., have reached attainment) are known as maintenance 
areas. 

[End of table] 

HUD generally provides rental housing assistance through three major 
affordable housing programs--housing choice vouchers, public housing, 
and project-based rental assistance. These three programs generally 
serve low-income households--that is, households with incomes less than 
or equal to 80 percent of area median income (AMI).[Footnote 17] Some 
of these programs include targets for households with extremely low 
incomes--30 percent or less of AMI. HUD-assisted households generally 
pay 30 percent of their monthly income, after certain adjustments, 
toward their unit's rent.[Footnote 18] 

* The Housing Choice Voucher program, which supports over 2 million 
housing units and is administered by local PHAs, provides vouchers that 
eligible families can use to rent houses or apartments in the private 
housing market. Voucher holders are responsible for finding suitable 
housing that meets HUD's housing quality standards. The subsidies in 
the voucher program are provided to the household (that is, tenant- 
based), so tenants can use the vouchers in new residences if they move. 
The housing subsidy is paid to the property owner directly on behalf of 
the participating households. The household then pays the difference 
between the actual rent charged by the owner and the amount subsidized 
by the program. PHAs have some flexibility to determine the maximum 
amount of rental subsidy they can pay for assisted households within 
limits set by HUD. For example, HUD establishes "fair market rents" for 
each metropolitan area, based on actual market rents for standard- 
quality rental units, but PHAs may choose a "payment standard" that is 
up to 10 percent lower or higher than the fair market rent. 

* The public housing program, also managed by PHAs through operating 
and capital grants, subsidizes the development, operation, and 
modernization of government-owned properties and provides units for 
eligible tenants in these properties. In contrast to the voucher 
program, the subsidies in the public housing program are connected to 
specific rental units, so tenants receive assistance only when they 
live in these units. HUD pays an operating subsidy, which helps to 
cover the difference between the PHA's operating costs and the rents 
the PHA collects from tenants. 

* Through a variety of project-based programs including project-based 
Section 8, HUD provides rent subsidies in the form of multiyear housing 
assistance payments to private property owners and managers on behalf 
of eligible tenants. Tenants may apply for admission to these 
properties with project-based rental assistance contracts. HUD pays the 
difference between the household's contribution and the unit's rent. 

HUD also administers formula grant programs, such as the Community 
Development Block Grant (CDBG) program and the HOME program, which help 
low-income households obtain access to affordable housing. These 
programs divide billions of dollars across local jurisdictions and 
numerous activities on an annual basis using funding formulas pursuant 
to statutory guidance. Activities funded by the CDBG program can 
include housing, economic development, neighborhood revitalization, and 
community development. The HOME program provides federal assistance to 
participating jurisdictions for housing rehabilitation, rental 
assistance, homebuyer assistance, and new housing construction. 
Recipients of CDBG and HOME funding have a great deal of flexibility in 
how they use these grants, and must fulfill HUD's planning requirements 
to receive funding. 

Transit-Oriented Developments Can Affect the Availability of Affordable 
Housing but Conclusions Are Complicated by Limited Research and Data: 

Characteristics of Transit-Oriented Developments Can Increase Nearby 
Land and Housing Values: 

According to most of the literature we reviewed, plans for the 
existence of transit stations and amenities commonly found in transit- 
oriented developments generally increase nearby land and housing 
values, but the magnitude of the increase varies greatly depending upon 
several other characteristics.[Footnote 19] The studies generally 
conclude that increases occur because residents place a premium on land 
and housing the closer each is to a transit station. Although the 
presence of transit generally affects land and housing values, 
increases in some cases are modest, and results can vary throughout an 
entire transit system depending on several characteristics which are 
summarized below. 

* Retail development is common to the type of mixed-use development 
found in transit-oriented developments because it allows residents to 
avoid car trips for everyday shopping. A few studies we looked at found 
that retail presence near transit stations affected land and housing 
values near transit positively. One particular study found that the 
stations with the highest increases in nearby housing values had a 
retail presence. 

* Neighborhood characteristics surrounding a transit station is another 
factor the studies we reviewed have shown to be valued by transit users 
and nontransit users resulting in increased land and housing values. 
The studies we reviewed showed a number of neighborhood characteristics 
such as higher relative incomes, and proximity to parks, schools, or 
other neighborhood amenities. One of the goals often cited in research 
of transit-oriented development is to create quality, desirable 
neighborhoods that include many of these amenities. 

* Other factors that have been found to increase land and housing 
values include proximity to job centers, pedestrian amenities, and 
quality or frequency of transit service. For example, a study of 
California transit systems found that increases in property values are 
more likely along reliable, frequent, and fast transit systems in the 
San Francisco-Oakland Area and San Diego than near more limited light 
rail service in Sacramento and San Jose.[Footnote 20] 

Conversely, some characteristics of areas near transit can limit 
increases, or even cause a transit station to be a negative influence 
on land or housing values. These characteristic include: 

* Non-transit-oriented land uses and prevalence of crime: In the San 
Francisco-Oakland Area, studies found that a transit station generally 
has a positive influence on land and housing values, except near 
certain stations in a largely industrial area in Oakland.[Footnote 21] 
In addition, the study of the Atlanta rail system found that the 
presence of crime limited increases and sometimes even decreased land 
and housing values, particularly near rail stations with an adjacent 
surface parking lot.[Footnote 22] 

* Poor economic environments: A study of Buffalo transit stations found 
a premium value for real estate near stations in high-income areas, but 
a negative effect on land and housing values near stations in low-
income areas.[Footnote 23] The authors conclude that these negative 
effects may be the result of a lengthy economic decline and population 
loss in Buffalo, delayed development, and a lack of job centers on the 
transit system rather than the presence of the transit station. 

Availability of Affordable Housing in Transit-Oriented Developments 
Varies Depending on Land and Housing Values, Local Decision Making, and 
Other Factors: 

Higher land and housing values generally tend to limit housing units 
affordable for lower-income households but many other factors can also 
affect the availability of affordable housing near transit and in 
transit-oriented developments.[Footnote 24] According to local 
officials and transit and housing stakeholders we spoke with, higher 
land and housing values have the potential to limit the affordable 
housing units that are market rate, government subsidized, or 
incentivized. Increased land and housing values can raise the market 
price of sale and rental housing beyond an affordable percentage for 
households at or below an area's median household income, thus reducing 
the availability of market rate affordable housing. Subsidized or 
incentivized affordable housing units can also be affected by higher 
land and housing values. For example, if rents for units near transit 
stations increase above fair market rents, tenant-based rental 
vouchers--provided through HUD's housing choice voucher program--may be 
insufficient to cover the increased rents. 

Moreover, a recent study conducted by Reconnecting America and the 
National Housing Trust highlighted that HUD project-based Section 8 
contracts for many properties near transit stations will expire in 
coming years.[Footnote 25] Nearly two-thirds of those buildings near 
transit in the eight cities the study examined have contracts expiring 
by 2012. As the study indicates, if contract holders believe that the 
increasing land values could allow them to charge higher rents than the 
subsidy they receive from HUD for participating in the Section 8 
contract, the property owners may decide not to renew the Section 8 
contracts.[Footnote 26] 

Increased values and land speculation can also potentially stifle 
development of affordable or mixed-income housing projects. In several 
places we visited, local officials and developers told us that higher 
land costs can make it difficult for projects to meet profit 
expectations, resulting in a preference for developers to market 
projects in transit-oriented developments to higher income households. 

In addition to land and housing values, local officials told us that 
several other conditions and local decisions can affect the 
availability of affordable housing near transit. For example: 

* Local economic conditions can suppress land and housing values 
proportionately more than the local median household income, resulting 
in an increased supply of affordable housing units at market rate. For 
example, officials in Cleveland told us that the weak local economic 
conditions have led to an abundant supply of market rate units that are 
affordable to people with low incomes. Therefore they are less focused 
on increasing the stock of affordable housing units near the recently 
completed Euclid Corridor Bus Rapid Transit, and more focused on 
stimulating economic development and revitalizing the general housing 
market. 

* Local transit station location decisions can also affect the 
availability of affordable housing near transit. For instance, although 
housing advocates and local officials raised concerns that as land 
values increase, low-income households may be displaced, several local 
officials we spoke with told us that new transit station locations were 
planned in corridors with limited housing prior to the construction of 
the transit line. These station locations were specifically placed in 
blighted or industrial areas or railyards with relatively inexpensive 
land and plentiful space available for infill developments.[Footnote 
27] For localities committed to providing affordable housing, new 
development near these transit stations provides opportunities for new 
affordable housing near transit. For example, officials in Washington, 
D.C., told us that some stations of the rail transit system were 
aligned to support housing and economic development on vacant or 
underutilized properties (see figure 2). 

Figure 2: Infill Development, Including Some Affordable Housing Units, 
Has Replaced Vacant or Underutilized Land near the Columbia Heights 
Station in Washington, D.C. 

[Refer to PDF for image: illustration] 

The illustration depicts the following: 

Infill development on previously vacant or underutilized property since 
2000: 
Transit station; 
1/2-mile radius from transit station; 
100% affordable housing; 
Mixed-income housing; 
Market rate residential or non-residential development. 

Source: GAO analysis of District of Columbia planning data. 

[End of figure] 

Other transit lines can be aligned to serve populated, low-income 
neighborhoods. Local officials told us that one of the goals of the 
Hudson-Bergen Light Rail was to provide better transit access to low- 
income residents of Jersey City and Hoboken, New Jersey. The 
introduction of light rail in the past decade, paired with longer-term, 
focused investment of HUD affordable housing and revitalization 
dollars, has helped improve the availability of quality, affordable 
housing near transit. While transit lines can provide better transit 
access to low-income residents in the short term--a key role of 
transit--housing advocates have raised concerns that rents will 
increase in the long term, placing pressure on existing low-income 
residents. 

* State and local commitment to preserving or developing affordable 
housing near transit can help ensure the availability of affordable 
housing despite potential increases in land value. Local officials told 
us that some tools--which we will discuss in greater detail in the next 
section--are available to subsidize affordable units or to encourage 
developers to provide affordable units to help counter higher rents and 
property values near transit. In addition, coordinated state and 
regional planning also can influence local governments' support of 
affordable housing in transit-oriented developments, according to 
recommendations from recent reports. For example, to overcome issues 
associated with increasing land values and speculation, nonprofit 
organizations and regional and local governments can invest in land 
along transit alignments with the intent to develop the land in the 
future with an affordable housing component. 

Limited Research and Data Complicate Conclusions about the Effect of 
Transit-Oriented Developments on the Availability of Affordable 
Housing: 

A lack of direct research, incomplete data, and factors unique to each 
transit station limit the conclusions that can be made about how 
transit-oriented developments affect the availability of affordable 
housing. To date, there has been little research that specifically 
links transit-oriented developments to affordable housing, hindering 
the ability of policy makers and private investors to make informed 
decisions or evaluate results. For example, most of the studies we 
reviewed focused on land or housing values near transit but did not 
distinguish between stand-alone transit stations and transit stations 
in transit-oriented developments. In addition, most studies did not 
directly measure the number of affordable housing units, or otherwise 
quantify the availability of affordable housing, whether it was market 
rate or subsidized. Moreover, the research that does exist on land and 
housing values is typically focused on specific geographic areas and 
does not distinguish among the effects of state and local commitment to 
affordable housing and other factors that affect the availability of 
affordable housing. Finally, many communities with relatively new fixed-
guideway transit systems have limited experience with transit-oriented 
developments, and often development--and any potential long-term 
effects on the availability of affordable housing--has yet to fully 
take hold.[Footnote 28] 

The scarcity of reliable housing data and limitations in analytical 
transportation planning methods also limit thorough study and 
evaluation of the direct effect that transit-oriented developments have 
on the availability of affordable housing.[Footnote 29] For example, 
HUD-subsidized housing data--the only nationwide data available for 
subsidized housing--do not provide a full and accurate picture of the 
availability of subsidized housing for research purposes. According to 
HUD, funding recipients self-report data for the locations of 
subsidized housing programs to local PHAs, limiting HUD's ability to 
ensure completeness and accuracy. In addition, the data that are 
collected are primarily intended for administrative purposes and HUD 
officials told us they think the data are sufficiently reliable for 
administrative purposes. However, our analysis of the data revealed 
that several quality concerns--including inconsistencies in data over 
time--limit using the data for research purposes which involve reliable 
long-term data analysis. HUD officials told us that a variety of 
potential explanations existed for these inconsistencies including 
transitions between reporting requirements having potentially caused 
missing records as well as some records with missing geographic 
data.[Footnote 30] For example, 32 PHAs were not required to submit 
data for Housing Choice vouchers or public housing units from 2000 to 
2006 due to participation in the Moving to Work program.[Footnote 31] 
Figure 3 shows examples of three geographic areas in which the number 
of HUD-subsidized housing unit records changes significantly over time 
and in some cases from one year to the next. While HUD's Performance 
and Accountability reports indicate there has been some variation in 
the overall number of HUD-subsidized units over time, the extent of 
change in figure 3 is not explained by this variation. The lack of 
reliable and complete data would limit analysis on the impacts of HUD 
investments for affordable housing near transit. Furthermore, state and 
local governments--which provide significant amounts of housing 
subsides--vary in the extent to which data are collected, available, 
and reliable. The affordability of market rate housing can also be 
affected by increases in land value in transit-oriented developments; 
however the market rate housing datasets that do exist, such as the 
American Housing Survey, do not record housing costs with the detail, 
scale, or frequency needed to capture trends that may result from 
transit-oriented developments. Our past work has also cited the 
difficulties of accurately predicting changes in traveler behavior and 
land use resulting from a transit project, as well as concerns about 
the quality of data inputs into local travel models.[Footnote 32] 

Figure 3: Examples of Inconsistencies in Number of HUD-Subsidized 
Housing Unit Records, 2000-2008: 

[Refer to PDF for image: multiple line graph] 

Fiscal year: 2000; 
State of New Jersey-Multifamily[C]: 39,496 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 18,072 units; 
Cleveland Metropolitan area - Public Housing: 9,383 units. 

Fiscal year: 2001; 
State of New Jersey-Multifamily[C]: 38,584 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 20,190 units; 
Cleveland Metropolitan area - Public Housing: 7,908 units. 

Fiscal year: 2002; 
State of New Jersey-Multifamily[C]: 37,877 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 17,654 units; 
Cleveland Metropolitan area - Public Housing: 1,465 units. 

Fiscal year: 2003; 
State of New Jersey-Multifamily[C]: 37,103 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 26,912 units; 
Cleveland Metropolitan area - Public Housing: 2,052 units. 

Fiscal year: 2004; 
State of New Jersey-Multifamily[C]: 47,229 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 27,641 units; 
Cleveland Metropolitan area - Public Housing: 9,503 units. 

Fiscal year: 2005; 
State of New Jersey-Multifamily[C]: 48,701 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 28,934 units; 
Cleveland Metropolitan area - Public Housing: 9,091 units. 

Fiscal year: 2006; 
State of New Jersey-Multifamily[C]: 48,577 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 22,167 units; 
Cleveland Metropolitan area - Public Housing: 10,667 units. 

Fiscal year: 2007; 
State of New Jersey-Multifamily[C]: 49,776 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 23,125 units; 
Cleveland Metropolitan area - Public Housing: 12,992 units. 

Fiscal year: 2008; 
State of New Jersey-Multifamily[C]: 49,791 units; 
Washington DC Metropolitan area - Section 8 Housing Choice 
Vouchers[A,B]: 26,178 units; 
Cleveland Metropolitan area - Public Housing: 13,057 units. 

Source: GAO analysis of HUD Data. 

Note: The graphic demonstrates several examples of significant and 
unexpected changes in the number of subsidies in each of these 
designated areas over time. 

[A] Washington, D.C., includes subsidies within the Metropolitan 
Washington Area. New Jersey includes subsidies located in the State of 
New Jersey. Cleveland includes subsidies located in Metropolitan 
Statistical Area 1680. 

[B] The District of Columbia Housing Authority is a participant in the 
HUD Moving to Work Program. 

[C] Multifamily programs include Section 8 Project Based/Section 202 - 
Project rental assistance contracts/Section 811 - Project rental 
assistance contracts/Section 236/Section 221(d3)/Rental Assistance 
Program/Rent Supplement. 

[End of figure] 

Local, State, and Federal Affordable Housing Programs and Policies 
Support, but Generally Do Not Require, Affordable Housing in Transit- 
Oriented Developments: 

Few Local and State Programs Are Specifically Targeted to Affordable 
Housing in Transit-Oriented Developments, and Most Are Incentive Based: 

Few local and state programs are targeted to assist local housing and 
transit providers develop affordable housing in transit-oriented 
developments; the few targeted programs that do exist mainly provide 
financial incentives to developers if they include affordable housing 
in new residential developments in transit-oriented developments. In 
our site visits, we found examples in which local housing providers 
used these targeted programs to either build new or preserve existing 
affordable housing in transit-oriented developments. For example, 
California allocated $285 million over a period of 3 years to the 
Transit-Oriented Development Housing Program, which uses loans and 
grants to encourage the development of housing development projects 
within one-quarter mile of transit stations.[Footnote 33] The loans and 
grants are made available on a competitive basis to affordable housing 
developers and local government housing agencies that commit to build 
at least 15 percent of the units they develop as affordable housing 
units.[Footnote 34] According to California officials, in 2008, $145 
million was committed or awarded to 16 applicants, and over 1,800 
affordable housing units will be created as a result of these awards. 
In Portland, Oregon, the Transit-Oriented Development Property Tax 
Abatement supports affordable housing on vacant or underutilized sites 
in transit-oriented developments by reducing operating costs for 
affordable housing property owners and developers through a 10-year 
maximum property tax exemption.[Footnote 35] For 2007-2008, Portland 
reported that the tax abatement program assisted 971 housing units 
resulting in over $1.3 million in foregone tax revenues for the city 
and county. Of these units, 279 have rents restricted for residents 
with incomes between 30 percent to 80 percent median family income. 
Finally, in Denver, Colorado, the city is developing a transit-oriented 
development fund that will provide funding to local affordable housing 
developers to preserve and create at least 1,200 affordable units for 
sale and rental along Denver mass transit corridors over a 10-year 
period. 

Many states use federal tax credits as a financial incentive to 
encourage development of affordable housing near transit as well as 
specifically in transit-oriented developments. States administer 
federal LIHTCs and provide them to developers in accordance with state 
Qualified Allocation Plans (QAP)--plans that states are required to 
develop which outline the competitive process used to award these 
funds. In QAPs, most states use a competitive points system to award 
LIHTCs. There is no statutory requirement that a state incorporate 
proximity to transit into its QAP. States that have either required or 
provided incentive points for proximity to transit have done so 
independent of federal requirements. In these states, incentive points 
can be earned if developments are within a certain radius of public 
transit or in transit-oriented developments as designated by a state or 
local authority.[Footnote 36] For example, New Jersey's QAP awards an 
additional point for proposed developments that are one-half mile from 
public transportation, as well as up to 10 points for proposed 
developments in Transit Villages, a designation given by New Jersey's 
Department of Transportation to transit-oriented developments.[Footnote 
37] New Jersey officials commented that since tax credits are awarded 
only to a fraction of those that apply for them, developers consider 
these points a strong incentive to propose projects that will earn the 
additional points for proximity to transit. Appendix III provides 
examples of LIHTC programs that contain proximity to transit 
incentives. Additionally, states can award additional tax credits in 
HUD-designated high-cost areas.[Footnote 38] While HUD designates high-
cost areas, which could include transit-oriented developments, states 
have the authority to designate buildings as being located in areas 
which they determine as high cost, independent of the areas designated 
by HUD. Oregon has used this authority to designate affordable housing 
buildings in transit-oriented developments as high-cost areas which 
require additional funding to be financially feasible. Therefore, 
Oregon provides additional tax credits to projects located in transit-
oriented developments. 

State and local governments we visited generally did not use incentives 
in their local land use regulations or building codes to promote 
affordable housing in transit-oriented developments. Rather, incentives 
and requirements provide broad support for state and local governments 
to promote affordable housing without regard to location. These can 
help support the economic feasibility of affordable housing development 
by using nonfinancial incentives--such as land use regulations and 
building codes--and financial incentives--such as direct funding or 
financing options. In addition to incentives, we found that a few state 
and local governments have implemented certain requirements to include 
affordable housing in new developments, but like most state and local 
incentives, these requirements are not specifically targeted at 
affordable housing in transit-oriented developments. Determining if 
these nontargeted incentives and requirements have ensured the 
availability of affordable housing in and near transit-oriented 
developments is difficult due to a number of reasons described earlier. 

Selected examples of state and local affordable housing incentives and 
requirements that have been used in transit-oriented developments but 
are not specifically designed for use in transit-oriented developments 
include the following: 

Incentives: 

* Density bonus permits allow developers to build more than the maximum 
number of allowable units permitted by local code if they agree to 
designate a certain number of units as affordable housing. 

* Parking reductions allow local governments to reduce minimum parking 
requirements set forth in local building codes for developers that 
build near transit. This incentive allows developers to build fewer 
parking spaces and use the money saved from the reduced parking 
construction costs to support additional affordable units. 

* Tax increment financing is used by local governments to encourage 
economic development by issuing municipal bonds to subsidize 
development, which are repaid using the incremental future tax 
revenues. Some localities dedicate a portion of tax increment financing 
for affordable housing. 

* Affordable housing trust funds are distinct funds set aside by 
cities, counties, and states that dedicate sources of revenue to 
support affordable housing development. 

Requirements: 

* Inclusionary zoning: Some states or localities may require that all 
new housing developments, regardless of location, include a portion of 
units as affordable housing. Some inclusionary zoning ordinances allow 
developers to pay the local government for each affordable unit they 
choose not to build. 

* Affordability requirements on publicly financed residential 
development: Some state and local governments include affordable 
housing requirements when they sell land to housing developers or when 
any government financing is involved in the project. 

We found examples from our site visits and other research where each 
type of nontargeted incentive and requirement discussed above was being 
used to support affordable housing in transit-oriented developments 
(see table 2). Because developers (both for profit and nonprofit) are 
not required to do so, developers may or may not take advantage of the 
various state and local government incentives to build or preserve 
affordable housing in transit-oriented developments. 

Table 2: Examples of State and Local Affordable Housing Incentives and 
Requirements that Have Been Used in Transit-Oriented Developments but 
Are Not Specifically Designed for Use in Transit-Oriented Developments: 

Category: Nonfinancial incentives; 
Type: Density bonus; 
Location: Arlington County, Virginia; 
Example: Arlington County permits a 25% density bonus to developers who 
provide affordable units. The density bonus allows both market rate and 
affordable units, with the income from the market-rate units designed 
to offset the cost of the affordable units; 
Result: Quincy Plaza, a residential development in the transit-oriented 
development around the Ballston Metro station, used the full 25% bonus 
to add 25 affordable units. 

Category: Financial incentives; 
Type: Tax increment financing; 
Location: Sacramento, California; 
Example: All local redevelopment agencies in California are required to 
set aside 20% of tax increment financing resources for a separate 
affordable housing fund; 
Result: Sacramento's redevelopment agency supported 114 low-income 
senior apartments in a transit-oriented development through $6 million 
in tax increment financing. 

Category: Financial incentives; 
Type: Affordable housing trust funds; 
Location: Los Angeles, California; 
Example: The City of Los Angeles's Affordable Housing Trust Fund 
provides funding to create affordable housing, as well as revitalize 
neighborhoods and remove blight; 
Result: In 2008, 225 affordable housing units in three developments 
located in transit-oriented developments in Los Angeles received over 
$21 million from the Affordable Housing Trust Fund. 

Category: Requirements; 
Type: Inclusionary zoning; 
Location: Montgomery County, Maryland; 
Example: Montgomery County's Moderately Priced Dwelling Unit program 
requires that at least 12.5 percent of the units in new subdivisions of 
20 or more units be set aside as affordable units; 
Result: King Farm, a mixed-use transit-oriented development adjacent to 
the Shady Grove Metro Station in Rockville, Montgomery County, includes 
3,200 units, of which 353 units are affordable as part of the County's 
inclusionary policy. 

Category: Requirements; 
Type: Affordability requirements on publicly financed residential 
development; 
Location: New Jersey; 
Example: Statutory requirement that any new housing development for 
which the land was purchased from a state or local government agency, 
or which received any kind of state funding, must set aside at least 
20% of the residential units for low-and moderate-income individuals; 
Result: Legislation enacted in July 2008 and results are not yet 
available. 

Source: GAO. 

[End of table] 

HUD and FTA Programs Allow Local and State Agencies to Promote 
Affordable Housing near Transit, but Rarely Provide Direct Incentives 
to Target Affordable Housing in Transit-Oriented Developments: 

Local housing providers have used HUD programs in a number of cases to 
support affordable housing in transit-oriented developments, however, 
these programs support affordable housing in any location. HUD 
programs, such as the CDBG and HOME programs, generally provide local 
and state agencies with flexibility to tailor their housing spending 
decisions to meet local needs. According to HUD officials, CDBG and 
HOME grant recipients have flexibility in applying funds to local 
initiatives, and in some locations we visited, local officials told us 
they used these funds, among others, to increase affordable housing 
near transit as part of a transit-oriented development plan. 

* A community development corporation in Washington, D.C., used 
approximately $7 million in CDBG funds to rehabilitate or develop 
approximately 800 units of affordable housing and generate economic 
development as part of its efforts to revitalize the neighborhood 
around a transit station. 

* In Hoboken, New Jersey, a local housing agency official highlighted 
the flexibility in the CDBG program as an opportunity for the city to 
target funding to best meet the city's need to revitalize the existing 
housing stock around new transit stations. 

* In Seattle, Washington, local housing agency officials allocated over 
$4 million in HOME program funds to subsidize 200 new affordable units 
in four rental housing developments located in transit-oriented 
developments. 

Similarly, numerous other HUD programs, including project-based Section 
8 and the Housing Choice Voucher program, can be used to support 
affordable housing in transit-oriented developments, but according to 
HUD officials, these programs have not been targeted specifically for 
developing or preserving affordable housing in transit-oriented 
developments.[Footnote 39] While project-based Section 8 assists more 
than 1.3 million low-and very-low-income families, during our site 
visits, local and federal housing agency officials told us they had not 
prioritized the renewal of project-based Section 8 contract housing in 
transit-oriented developments. As highlighted earlier, a study found 
that some project-based Section 8 housing is located near rail 
stations--defined as within one-half mile of existing or proposed rail 
stations--and that many of the contracts for the properties near rail 
stations are set to expire before the end of 2012. Housing experts have 
identified this as a potential problem since Section 8 contract holders 
may not renew these contracts if they believe the rents they could earn 
without the contract would be higher than the rental subsidy they 
receive from HUD, thereby, reducing the number of affordable units in 
these areas. The Housing Choice Voucher program is also a significant 
source of HUD-subsidized affordable housing that individuals can use 
for housing in transit-oriented developments. However, this requires 
that individuals find units where the owner accepts the voucher, which 
is set at the region's fair market rent.[Footnote 40] HUD allows for 
exceptions to be made to the fair market rent valuations in high-cost 
areas, but HUD officials did not know of any exceptions that had been 
made specifically based on rents in transit-oriented developments 
exceeding HUD's fair market rent valuations. 

It is unclear the extent to which increases in market rate rents that 
may occur in transit-oriented developments have affected subsidized 
housing, such as project-based Section 8 properties and rental 
vouchers. In transit-oriented developments, consideration of ways to 
ensure that project-based Section 8 contract units remain affordable 
and rental vouchers remain viable may be integral to ensuring the 
ongoing availability of affordable housing in transit-oriented 
developments. However, as described earlier, HUD's data for its 
subsidized housing programs have limitations. These limitations do not 
permit a comprehensive analysis of the HUD-subsidized housing units 
located in transit-oriented developments. In addition, HUD has not 
assessed the effects of its policies and programs in supporting the 
availability of affordable housing in transit-oriented developments. 
Without such analysis grounded in reliable data, it will be difficult 
for HUD to assess how its programs might help to ensure the 
availability of affordable housing in transit-oriented developments. 

While most HUD programs do not consider a connection between housing 
and transit in the program criteria, some HUD programs do provide 
incentives for building affordable housing near transit, but not 
specifically in transit-oriented developments. For example, the 
Neighborhood Stabilization Program, funded by the American Recovery and 
Reinvestment Act of 2009, provides competitive grants to states, local 
governments, and nonprofits to address the damaging economic effects of 
properties that have been foreclosed and abandoned.[Footnote 41] Of the 
funds to be awarded to successful applicants of this program, 25 
percent must be used for the purchase and redevelopment of abandoned 
and foreclosed-upon homes and residential properties to house 
individuals and families whose incomes do not exceed 50 percent of AMI. 
Under the program's competitive scoring criteria, applications for 
projects that are transit accessible will be awarded additional points. 
[Footnote 42] Also, Sections 202 and 811--multifamily programs for the 
elderly and people with disabilities, respectively--consider proximity 
to transit in their selection criteria. HUD officials from one region 
noted that the location of multifamily projects is determined by many 
other factors, such as land prices, which have a greater impact in the 
rating process than access to transit. HUD's HOPE VI program, which 
funds the redevelopment of obsolete public housing, also has a formal 
link between public housing and transit. If public housing locations 
that are selected as HOPE VI redevelopment sites lack sufficient 
transportation to services and employment, then project plans for 
revitalization must include increased access to transportation. 

Since FTA's core mission is to support locally planned and operated 
public transportation systems, we found that FTA policies that allow 
local transit agencies to support affordable housing in transit- 
oriented developments are limited and still have a statutory 
requirement to support transit use. Under FTA's Joint Development 
Guidance, local transit agencies can use land that was purchased with 
FTA funds to support transit-oriented developments through joint 
development partnerships.[Footnote 43] With FTA approval, local transit 
agencies can improve this property through incorporation of private 
investment, including commercial or residential development (to include 
affordable housing), as long as the transit agency can demonstrate that 
the development supports transit. To receive FTA approval, the local 
transit agency must demonstrate that the joint development project 
provides an economic link, public transportation benefits, revenue for 
public transportation, and reasonable share of costs (if applicable). 
The current Joint Development Guidance seeks to allow the maximum 
flexibility to transit agencies under the law when undertaking joint 
development purposes.[Footnote 44] Of four FTA regions we contacted 
regarding their approved joint development projects, FTA officials 
identified a total of 11 approved projects, of which four were used by 
a local transit agency to support the development of affordable housing 
as part of a transit-oriented development.[Footnote 45] Portland, 
Oregon's transit agency had three of the approved projects, including a 
recent project which included the development of 54 affordable housing 
units. In Portland, the transit agency used land it had purchased for 
construction staging areas as part of a New Starts-funded transit 
development for a joint development project. When construction of the 
transit stop was completed, the agency sold the land to a developer 
with the condition that affordable housing be part of the development. 
In two of our site visit locations, we heard from local transit agency 
officials that the guidelines for the Joint Development Program policy 
are unclear and that further clarification would assist them in 
supporting transit-oriented development through joint development 
partnerships with the private sector. According to FTA officials, an 
FTA task force is clarifying the eligible activities that can be 
supported through the provisions and applications of this policy. 

While FTA's New Starts Program considers mobility improvements for 
riders--which includes consideration of the lowest socioeconomic group 
of transit dependent residents--and economic development benefits of 
proposed New Starts projects, FTA currently does not weigh these 
criteria in its overall project rating.[Footnote 46] In a number of our 
site visit locations, local transit agencies planned to implement 
components of transit-oriented development around one or more of the 
transit stations that were part of the transit project funded by New 
Starts. Some local government transit officials we interviewed and 
literature we reviewed described the benefits of transit-oriented 
development--which includes components such as higher-density and mixed-
use projects of commercial and residential activity--as potentially 
including economic development. 

However, many of the local transit agencies we met with commented that 
although they viewed the transit stations as anchors for economic 
development, they did not believe the New Starts project evaluation 
criteria fully assessed the project's impact from economic development 
activities. In a previous report, we also found transit stakeholders 
who expressed concern about how economic development is considered in 
the New Starts project evaluations.[Footnote 47] When we discussed this 
with FTA officials as part of our current review, they discussed the 
challenges of capturing economic development benefits and separating 
those benefits from the measures included under the transit supportive 
land use criterion. FTA officials acknowledged the limitations of its 
current approach, but noted that FTA has been working with the transit 
industry to develop a more robust methodology for measuring economic 
development effects. FTA officials explained that the transit industry 
has not yet reached consensus on the best way to measure economic 
development effects that would be useful in meaningfully distinguishing 
between projects and would not require extensive new data collection 
and reporting by project sponsors. The FTA officials also said a 
quantitative approach could require significant additional time and 
contractor resources for both project sponsors and FTA. 

Some HUD and FTA regional officials noted they support having 
affordable housing in close proximity to transit but they emphasized 
that local governments have jurisdiction over land use planning and 
determine priorities for the development of affordable housing and 
transit. Recipients of either certain HUD or DOT program funding must 
fulfill planning requirements calling for them to focus on either 
community development and affordable housing issues for HUD funding or 
transportation issues for DOT funding.[Footnote 48] The requirement for 
local and state agencies to integrate housing and transportation issues 
in these planning activities, however, is minimal. Guidelines for the 
Consolidated Plan required by HUD urge jurisdictions to coordinate with 
other local plans, which may include metropolitan-wide plans that 
address issues such as transportation. Some officials from HUD and 
local agencies receiving HUD funding noted that guidance on the 
Consolidated Plan was not significant in integrating affordable housing 
and access to transit. DOT requires states and metropolitan areas, 
through their metropolitan planning organizations, to develop long- 
range and short-term transportation plans, which includes planning for 
transit. These transportation plans are also limited in integrating 
housing into transportation planning. In some regions, HUD officials 
told us they attend local or regional planning meetings, but their role 
is limited to observing or providing guidance on HUD programs. 
Similarly, DOT officials said that FTA officials provide guidance to 
states, metropolitan planning organizations, and transit agencies 
regarding FTA program and planning requirements, but do not influence 
decision making related to transportation plans and programs. HUD and 
DOT have recently considered ways to strengthen integrated housing and 
transit planning, as described in more detail later in this report. 

Local Governments and Developers Encounter Challenges in Supporting 
Affordable Housing in Transit-Oriented Developments: 

According to transit and housing agency officials and stakeholders we 
interviewed, infrastructure and economic conditions can present 
challenges to supporting affordable housing in transit-oriented 
developments. Some local housing agency officials told us that in some 
areas where land values are higher (and irrespective of proximity to 
transit) the high cost of land acquisition made it economically 
unfeasible for a developer to build affordable housing units. As 
discussed earlier, several studies we reviewed show that the presence 
of a transit station, as well as factors associated with transit- 
oriented developments, generally increase the value of land near the 
transit station. Based on their experiences, some affordable housing 
providers we interviewed commented that the value of land near a 
transit station rose quickly with the announcement of the station's 
opening. Therefore, affordable housing providers told us they may 
require additional financial support from government agencies to 
support affordable housing units in close proximity to transit stations 
and in transit-oriented developments. Local affordable housing 
providers often referred to land banking as another tool to address the 
challenge of land acquisition in high-cost areas. Affordable housing 
developers land bank when they purchase land at a low cost in 
anticipation of future increases in land values, thereby lowering land 
acquisition costs and using the additional funds on affordable housing. 
Many officials told us, however, they had limited opportunities to 
practice land banking for affordable housing development due to limited 
resources and available land near transit. 

According to local affordable housing providers and experts, the 
ongoing economic slowdown has contributed to a slowdown in the 
construction of new housing, including affordable housing. 
Specifically, they noted that the ongoing economic slowdown has caused 
LIHTCs to be less valuable, which may lead to less funding for 
affordable housing. Tax credits are allocated to affordable housing 
developers, who typically sell the credits to private investors, who 
then use the tax credits to offset taxes otherwise owed on their tax 
returns. Generally, the money private investors pay for the credits is 
paid into the projects as equity financing. This equity financing is 
used to fill the difference between the development costs for a project 
and the non-tax-credit financing sources available, such as mortgages 
that could be expected to be repaid from rental income. Financial 
institutions with limited resources have been buying fewer tax credits, 
and as a result prices for tax credits have dropped and funding 
available for affordable housing has declined. 

Local housing officials we spoke to also described aspects of federal 
policy and programs that may limit the programs' use for supporting 
affordable housing in transit-oriented developments. One source of 
financial support, the LIHTC program, has some specific provisions that 
limit its use in developing affordable housing in transit-oriented 
developments. Specifically, the amount of tax credits for which a 
development project is eligible is based in part on the amount of 
development costs for the project. But, the development costs used to 
calculate the amount of tax credits excludes the cost of acquiring land 
and higher land costs may be associated with transit-oriented 
development.[Footnote 49] This can potentially make LIHTCs less 
valuable for developers building affordable housing in transit-oriented 
developments. Developers may receive financial assistance through the 
CDBG and HOME programs to acquire land as part of LIHTC projects. Also, 
as described earlier, states may designate transit-oriented 
developments as high-cost areas, allowing them to allocate additional 
tax credits to affordable housing developments in such areas. Another 
aspect of the LIHTC program which may limit its use in transit-oriented 
developments is that the maximum tax credit allowed for each project is 
based on the development costs allocated to only those units that are 
designated for low-income residents. Since tax credits are applied only 
to those units in the housing development that qualify as affordable, 
there is an incentive for developers to plan for as many affordable 
units as possible, making mixed-income developments relatively less 
competitive in this regard. However, some transit-oriented development 
studies have cited the benefits of mixed-income housing in transit- 
oriented developments. Some states appear to be addressing this by 
prioritizing mixed-income housing for tax credits in their QAPs. 

In some cases local transit agencies we contacted described the 
challenge of selling surplus land--purchased using federal funds--for 
affordable housing development near transit. Transit officials said 
they had explored the possibility of selling the land at a low cost to 
affordable housing developers to increase the availability of 
affordable housing in transit-oriented developments. However, they 
cited the requirement to sell this land at fair market value as a 
potential barrier to selling the land at a low cost in order to make it 
more feasible for the development of affordable housing in high cost 
areas. According to FTA officials, transit agencies may dispose of real 
property through sale, using competitive sale procedures to the extent 
practical, which yield the highest possible value return.[Footnote 50] 
In certain circumstances, transit agencies may transfer the property 
for purposes such as affordable housing joint development.[Footnote 51] 

DOT, HUD, and FTA Have Collaborated on Interagency Efforts to Promote 
Affordable Housing in Transit-Oriented Developments, However, 
Implementation Has Been Limited, and Additional Steps to Enhance 
Collaboration Could Be Taken: 

HUD and FTA, and More Recently DOT, Have Collaborated on Interagency 
Efforts to Promote Affordable Housing in Transit-Oriented Developments: 

Starting in 2005, HUD and FTA, and more recently DOT, have collaborated 
to promote affordable housing in transit-oriented developments through 
three interagency efforts, which are summarized below. 

* Interagency agreement: In 2005, HUD and FTA entered into an 
interagency agreement to assist communities in understanding the 
potential demand for housing in transit-oriented developments by 
conducting a research study. The agreement identified five major 
research objectives, including (1) increasing the understanding of the 
potential for incorporating housing--including affordable or mixed-
income housing--and homeownership in transit-oriented developments; (2) 
enhancing data analyses and communities' geographic information system 
capacity for developing and building affordable housing adjacent to 
transit-oriented developments; (3) identifying federal, state, and 
local policies and future research that can influence linking 
affordable housing and transit-oriented developments; (4) quantifying 
the factors that facilitate the development of affordable housing in 
transit-oriented developments; and (5) identifying regulatory barriers 
to building affordable housing in transit-oriented developments. To 
address these research objectives, HUD and FTA funded the Center for 
Transit-Oriented Development (CTOD) to conduct this research study and 
publish a final report. The final report, which was published in April 
2007, recommended broad approaches to addressing some key challenges in 
supporting affordable housing in transit-oriented developments, 
including high land prices around transit stations, complex financing 
structures of mixed-income and mixed-use developments, and limited 
funding for building new affordable housing.[Footnote 52] 

* HUD-FTA action plan: In December 2007, the Appropriations Committees 
indicated that HUD and FTA should jointly address new and better ways 
for promoting affordable housing near transit service and develop a 
best practice manual to assist communities that seek to establish mixed-
income transit-oriented developments.[Footnote 53] In response to this 
request, HUD and FTA jointly developed an action plan to better 
coordinate their respective programs to promote affordable housing in 
transit-oriented developments, expand mixed-income and affordable 
housing choices in the immediate proximity of new and existing transit 
stations, develop a more comprehensive approach to address housing and 
transportation expenditures, and preserve existing affordable housing 
near transit. The HUD-FTA action plan outlines 11 strategies--including 
the development of the best practices manual for local governments to 
successfully promote mixed-income housing and transit-oriented 
developments--that HUD and FTA say they will implement from fiscal year 
2008 through fiscal year 2010.[Footnote 54] Some strategies are focused 
on increasing education for housing and transit stakeholders and 
reviewing current housing and transit policies and regulations. 

* Partnership for Sustainable Communities: In March 2009, DOT and HUD 
announced the Partnership for Sustainable Communities, which seeks to 
help American families gain better access to affordable housing, more 
transportation options, and lower transportation costs by coordinating 
federal programs. Since the partnership's original announcement, the 
Environmental Protection Agency (EPA) has joined the 
partnership.[Footnote 55] As part of this partnership, the agencies 
have highlighted six livability principles that will serve as the 
partnership's foundation. While these six livability principles 
establish some broad goals, including increasing transportation options 
to address climate change and supporting existing communities, a major 
component of the partnership is promoting affordable housing.[Footnote 
56] To support this partnership, the Secretaries of DOT and HUD and the 
EPA Administrator have created a high-level interagency task force, led 
by DOT's Deputy Assistant Secretary for Transportation Policy, the 
Senior Advisor to the HUD Deputy Secretary, and the EPA Director for 
the Development, Community and Environment Division. For example, the 
high-level interagency task force is charged with collaborating in 
developing a federal funding program, called the Sustainable 
Communities Initiative, to encourage local governments to integrate 
their regional housing, transportation, and land use planning and 
investments by funding grants for local governments to reform their 
current zoning, building codes, and land use codes. This Sustainable 
Communities Initiative will be administered by HUD under the proposed 
Office of Sustainable Development and in consultation with DOT and EPA. 
The President's fiscal year 2010 budget request for HUD includes $100 
million in Regional Planning Grants, $40 million for Community 
Challenge Grants, and $10 million for joint DOT and HUD research 
efforts in its fiscal year 2010 budget. The partnership will also fund 
joint DOT, HUD, and EPA research and evaluation efforts and work to 
align the respective agency programs. In addition, a joint HUD-FTA 
working group, which was originally formed as part of the HUD-FTA 
action plan, will be one of several individual working groups that will 
support the DOT/HUD/EPA high-level interagency task force in 
implementing the partnership. According to HUD officials, the 
partnership is intended to supersede and incorporate the activities 
contemplated by the HUD-FTA action plan. 

Based on our review, the three interagency efforts outlined a number of 
similar strategies and recommendations. For example, the CTOD report 
recommended that HUD explore regulatory and policy approaches that may 
increase the supply of affordable or mixed-income housing within 
transit corridors--a strategy outlined in the HUD-FTA action plan. In 
addition, all three interagency efforts have recommendations or 
strategies that encourage local jurisdictions to better integrate and 
coordinate their housing and transportation planning and to conduct 
research to better measure affordability. Table 3 provides a summary of 
recommendations and strategies made by the three interagency efforts. 

Table 3: Summary of Strategies and Recommendations Made by the Three 
Interagency Efforts: 

Category: Establishment of interagency working groups; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: Coordinate federal housing and 
transportation programs by establishing a HUD and FTA interagency 
working group; 
HUD-FTA action plan: August 2008: Implement Joint HUD-FTA Working 
Group; 
Partnership for Sustainable Communities: June 2009: Establish a high 
level DOT/HUD/EPA task force. 

Category: Coordination of federal programs, policies, and requirements; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: Use transportation and housing policies 
and funding to encourage mixed-income housing near transit; 
HUD-FTA action plan: August 2008: Improve coordination of housing and 
transportation planning through HUD's Consolidated Plan, DOT's 
Transportation Planning requirements, and other mechanisms; Identify 
regulatory barriers to affordable housing near transit; 
Partnership for Sustainable Communities: June 2009: Harmonize DOT, HUD, 
and EPA programs to identify opportunities to better coordinate their 
programs; Coordinate federally mandated housing and transportation 
planning requirements. 

Category: Opportunities for education and outreach; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: [Empty]; 
HUD-FTA action plan: August 2008: Identify opportunities for joint 
outreach to housing and transit providers and stakeholders; Conduct 
briefings and workshops for HUD and FTA staff; Enhance capacity-
building program(s) by providing technical assistance to transit 
providers, public officials, and other stakeholders; 
Partnership for Sustainable Communities: June 2009: [Empty]. 

Category: Changes in statutory requirements; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: [Empty]; 
HUD-FTA action plan: August 2008: Address affordable housing and mixed-
income housing needs in new legislative initiatives; 
Partnership for Sustainable Communities: June 2009: [Empty]. 

Category: Funding and financial incentives; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: Accelerate federal efforts to preserve 
existing affordable and market rate rental housing near transit; Target 
HUD funding sources to build housing near transit facilities; 
HUD-FTA action plan: August 2008: Identify financial incentives for 
funding affordable housing near transit; 
Partnership for Sustainable Communities: June 2009: Establish a 
competitive grant program for metropolitan areas to enhance integrated 
regional housing, transportation, and land use planning and investment. 

Category: Performance measurement; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: [Empty]; 
HUD-FTA action plan: August 2008: Assess the effectiveness of the HUD-
FTA action plan; 
Partnership for Sustainable Communities: June 2009: Establish standards 
and performance measures. 

Category: Research and development; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: Continue to study the causal 
relationships between housing markets and transit investments; 
HUD-FTA action plan: August 2008: Identify opportunities for joint 
research and development policy analysis; 
Partnership for Sustainable Communities: June 2009: Research, evaluate, 
and recommend measures that indicate the livability of communities, 
neighborhoods, and metropolitan areas. 

Category: Research and development; 
Center for Transit-Oriented Development Report (specific federal 
recommendations): April 2007: Consider implementing a federal 
affordability measurement that reports on the combined costs of housing 
and transportation; 
HUD-FTA action plan: August 2008: Develop a best practices manual for 
mixed-income housing near transit; 
Partnership for Sustainable Communities: June 2009: Develop a federal 
housing affordability measure that includes housing and transportation 
costs. 

Source: GAO. 

[End of table] 

HUD and FTA Collaboration Has Not Yet Affected Federal Support to Local 
Housing and Transit Agencies: 

Although HUD and FTA's collaboration has produced numerous 
recommendations and strategies to promote affordable housing in transit-
oriented developments, local officials told us these efforts have had 
little impact on local housing and transit agencies' planning and 
decision making. As we mentioned above, because housing and 
transportation planning and decision making is done by state and local 
jurisdictions, many of these recommendations and strategies could 
affect how local housing and transit agencies use federal programs to 
support their activities. However, since many of these strategies are 
relatively new and have yet to be implemented, it may be too soon to 
evaluate their effectiveness. 

Furthermore, our review of the HUD-FTA action plan shows that while 
some of the strategies identify specific products or other 
deliverables--such as publishing a best practices manual in fiscal year 
2010 or developing an outreach plan--many other strategies require 
additional research and analysis before any actual change to current 
federal policy or programs could be made. For example, both the CTOD 
report and the HUD-FTA action plan recommend identifying regulatory 
barriers to promote affordable housing in transit-oriented developments 
and identifying a range of incentives that could be adopted to support 
efforts to include affordable housing in such developments. And while 
HUD has recently issued two competitive task order requests to 
implement some of the strategies, including identifying regulatory 
barriers identified in the HUD-FTA action plan, it will still take some 
time before these strategies can potentially benefit housing and 
transit agencies.[Footnote 57] For example, under the terms of the 
first contract, three policy reports assessing--(1) state, federal, and 
local regulatory barriers to mixed-income housing in transit-oriented 
developments; (2) financing techniques available for mixed-income 
housing in transit-oriented developments; and (3) incentives through 
HUD and FTA programs--are due to be completed and published by July 1, 
2010, almost 3 years after this assessment was first recommended by the 
CTOD report.[Footnote 58] Once the agencies have identified the 
regulatory barriers, they need to take additional steps--some of which, 
such as public notice and comment periods, take time--to address those 
barriers. Furthermore, HUD and FTA must identify which areas may 
require congressional action to revise current statutory requirements. 
In addition, the second contract solicits the development of a model 
transportation and housing plan that can be utilized as a template by 
local jurisdictions; however, this plan is not expected to be completed 
until March 2011. 

Because several strategies in both the HUD-FTA action plan and the 
Partnership for Sustainable Communities have no detailed implementation 
information available, it is unknown when and how these strategies 
could impact local housing and transit agencies. In our prior work 
examining a variety of federal programs, we have highlighted the 
importance of having implementation plans to build momentum and show 
progress from the outset.[Footnote 59] For the Partnership for 
Sustainable Communities, the President's fiscal year 2010 budget 
request for HUD includes $150 million for the Sustainable Communities 
Initiative. As part of this initiative, $100 million is allocated for 
the proposed Regional Integrated Planning Grants program, which will 
award grants to local metropolitan areas or states that integrate their 
regional transportation, housing, and land use planning and investment. 
However, this budget has not been approved and therefore, no detailed 
information is available regarding the components of this program or 
how this program will be implemented. An example of the steps that HUD, 
in consultation with DOT and EPA, may need to take to implement this 
type of grant program can be seen with DOT's recent implementation of a 
similar type of grant program, the new Urban Partnership Agreement 
initiative. This initiative--a competitive grant program intended to 
demonstrate the feasibility and benefits of comprehensive, integrated, 
and innovative approaches to relieving congestion--illustrates the many 
steps required to implement a competitive grant program. DOT issued a 
Federal Register notice soliciting proposals for the Urban Partnership 
Agreement Initiative, set requirements for applications, created a 
multistep review process, and established terms and conditions of the 
agreement[Footnote 60]. However, because there is no detailed 
information available on the proposed Regional Integrated Planning 
Grants program, it is unclear how grants will be awarded or when the 
program will be finalized. In addition, HUD and FTA officials stated 
they are still working to determine whether there will be any link 
between these competitive grants under the Sustainable Communities 
Initiative and the HUD-FTA development of a transportation and housing 
planning model. 

Finally, local housing and transit agencies with whom we met were 
generally unaware of the collaboration between HUD and FTA. Many of the 
local housing and transit agencies officials we interviewed stated they 
were not aware of the HUD-FTA action plan or that HUD and FTA had been 
working on this project. In addition, as part of our site visits, we 
interviewed officials from HUD regional and field offices and FTA 
regional offices. During these visits, we found that most of these 
regional officials had not received official copies of the HUD-FTA 
action plan, were unaware that the action plan was posted on the 
agencies' Web sites, and most were generally unaware of the plan's 
strategies. In addition, HUD and FTA headquarters officials noted that 
only headquarters staff were involved in the development of the action 
plan and did not receive any formal input from regional officials or 
local housing and transit agencies.[Footnote 61] We have highlighted in 
prior GAO reports that other federal agencies reach out to key 
stakeholders to collect input from stakeholders and gain support for 
the program both during the development of the program and during its 
implementation.[Footnote 62] 

DOT, HUD, and FTA Have Started Using Some Key Practices for Enhancing 
and Sustaining Collaboration, but a More Formal Approach and Other 
Practices Could Encourage Further Collaboration: 

Key practices for enhancing and sustaining collaboration could be used 
to help the agencies implement the HUD-FTA action plan and the recently 
announced Partnership for Sustainable Communities.[Footnote 63] We have 
reported before that federal agencies often face a range of barriers 
when they attempt to collaborate with other agencies, including 
missions that are not mutually reinforcing, concerns about protecting 
jurisdictions over missions and controls over resources, and 
incompatible procedures, processes, data, and computer systems. 
[Footnote 64] In our October 2005 report, we identified eight key 
practices federal agencies can undertake to overcome these barriers and 
enhance and sustain their collaborative efforts.[Footnote 65] Table 4 
summarizes the key practices and extent to which DOT, HUD, and FTA are 
using these key practices.[Footnote 66] While these practices can 
facilitate greater collaboration among federal agencies, we recognize 
that other practices may also help to foster greater collaboration. In 
addition, while the specific ways in which agencies implement these 
practices may differ in light of the specific collaboration challenges 
each agency faces, we have previously recommended that federal agencies 
adopt a formal approach--to include practices such as a memorandum of 
agreement or formal incentives focused on collaboration signed by 
senior officials--to encourage further collaboration.[Footnote 67] 

Table 4: Eight Key Practices Federal Agencies Can Undertake to Enhance 
and Sustain Collaborative Efforts and the Extent to which DOT's, HUD's, 
and FTA's Collaboration Efforts Are Consistent with These Key 
Practices: 

Key practice: Define and articulate a common outcome: To overcome 
significant differences in agency cultures and established ways of 
doing business, collaborating agencies must have a clear and compelling 
rationale to work together; 
The agencies have not taken any action consistent with the key 
practice: [Empty]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Check]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Establish mutually reinforcing or joint strategies: To 
achieve a common outcome, collaborating agencies need to establish 
strategies that work in concert with those of their partners or are 
joint in nature; 
The agencies have not taken any action consistent with the key 
practice: [Empty]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Check]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Identify and address needs by leveraging resources: 
Collaborating agencies should identify the human, information 
technology, physical, and financial resources needed to initiate or 
sustain their collaborative effort. By assessing their relative 
strengths and limitations, agencies can look for opportunities to 
address resources needs by leveraging each other's resources; 
The agencies have not taken any action consistent with the key 
practice: [Empty]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Check]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Agree on agency roles and responsibilities: Collaborating 
agencies should work together to define and agree on their respective 
roles and responsibilities, including how the collaborative effort will 
be led; 
The agencies have not taken any action consistent with the key 
practice: [Empty]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Check]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Establish compatible policies, procedures, and other 
means to operate across agency boundaries: To facilitate collaboration, 
agencies need to address the compatibility of standards, policies, 
procedures, and data systems that will be used in the collaborative 
efforts; 
The agencies have not taken any action consistent with the key 
practice: [Check]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Empty]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Develop mechanisms to monitor, evaluate, and report on 
results: Agencies involved in collaborative efforts need to create the 
means to monitor and evaluate their efforts to enable them to identify 
areas for improvement; 
The agencies have not taken any action consistent with the key 
practice: [Check]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Empty]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Reinforce agency accountability for collaborative efforts 
through agency plans and reports: Collaborating agencies should ensure 
that goals are consistent and, as appropriate, program efforts are 
mutually reinforced through tools such as strategic and annual 
performance plans; 
The agencies have not taken any action consistent with the key 
practice: [Empty]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Check]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Key practice: Reinforce individual accountability for collaborative 
efforts through performance management systems: Collaborating agencies 
should use their performance management systems to strengthen 
accountability for results, specifically by placing greater emphasis on 
fostering the necessary collaboration both within and across 
organizational boundaries to achieve results; 
The agencies have not taken any action consistent with the key 
practice: [Check]; 
The agencies have identified and initiated one or more actions that are 
consistent with the key practice: [Empty]; 
The agencies have implemented actions consistent with the key practice 
by adopting a formal approach such as a memorandum of agreement or 
formal incentives: [Empty]. 

Source: GAO analysis. 

[End of table] 

In comparing the agencies' collaboration--through the interagency 
agreement, the HUD-FTA action plan and the Partnership for Sustainable 
Communities--to these key practices, we found that the agencies have 
taken some initial actions that are consistent with some of the key 
practices; however, these actions have not been fully formalized. Even 
though some of the interagency efforts are still in the early stages-- 
such as the HUD-FTA action plan and the Partnership for Sustainable 
Communities--and implementation has only recently started, 
collaboration between the agencies started back in 2005 with their 
interagency agreement. 

* The agencies have started defining and articulating a common outcome, 
through the three interagency efforts, to highlight a compelling 
rationale for why the agencies have to collaborate, by establishing 
some goals for their collaboration efforts. These goals include 
expanding mixed-income and affordable housing choices near transit, 
developing a more comprehensive approach on housing and transportation 
affordability, and preserving existing affordable housing. However, the 
development of a common outcome takes place over time and requires 
sustained resources and commitment by both agencies staff. The agencies 
have only recently begun allocating resources to implementing the 
strategies and recommendations produced by the efforts and assigning 
staff to work on the various interagency working groups to implement 
these strategies and recommendations. 

* The agencies have identified and taken steps to establish mutually 
reinforcing or joint strategies that were developed in both the HUD-FTA 
action plan and the Partnership for Sustainable Communities. For 
example, the HUD-FTA action plan calls for identifying opportunities 
for joint research and development, improving coordination of local 
housing and transportation planning through federal housing and 
transportation programs, and identifying financial incentives to local 
communities through both HUD and FTA funding programs. By establishing 
these reinforcing strategies, the agencies can align core processes and 
resources to accomplish the common outcome. However, while the agencies 
have started implementing some of these reinforcing strategies, such as 
awarding the contract to prepare an outreach plan, and have recently 
adopted a shared set of principles, a number of these efforts require 
additional research and analysis, and therefore, it is too soon to 
determine how the agencies will integrate these reinforcing strategies 
into current agency processes and resources. 

* HUD and FTA have identified and started leveraging resources needed 
to initiate or sustain their collaboration efforts by allocating 
funding to start implementing a number of the HUD-FTA action plan 
strategies and proposing funds for the Partnership of Sustainable 
Communities, through the proposed Sustainable Communities Initiative in 
the fiscal year 2010 HUD budget. In addition, the agencies have 
assigned staff to work on the interagency task force and have 
established four interagency working groups to work on a number of 
items, such as developing performance measures and identifying barriers 
to coordinated housing and transportation investments. However, the 
most significant resource investment, $150 million for the Sustainable 
Communities Initiative, has not yet been approved by Congress, and 
therefore, the initiative's final budget is unclear. 

* The agencies have started to define and agree on their respective 
roles and responsibilities, and in doing so, are beginning to clarify 
who will do what, identify how to organize their joint and individual 
efforts, and facilitate their decision making. For example, under the 
Partnership for Sustainable Communities, DOT and HUD have formed an 
interagency task force to implement the specific programs and policies 
of the initiative and plans to have HUD administer the Regional 
Integrated Planning Grants program, in consultation with DOT, EPA, and 
other federal agencies. However, while the DOT-HUD high-level 
interagency task force has conducted numerous meetings, and has 
scheduled future meetings, to discuss goals, objectives, implementation 
issues, and establish working groups, the agencies have yet to formally 
determine and document how specific roles and responsibilities will be 
divided. 

* There have been actions taken to reinforce agency accountability 
through strategic and annual performance plans. For example, our review 
of both agencies' recent strategic and annual performance plans found 
that while only HUD had included the collaboration efforts with FTA in 
its 2008 annual performance review, officials in both agencies noted 
they would be updating their strategic plans and annual performance 
plans to include their collaboration efforts. 

Based on interviews with HUD and FTA officials, there are several other 
key collaboration practices the agencies have not yet begun to 
implement. These key practices include establishing compatible 
policies, procedures, and other means to operate across agency 
boundaries; developing a mechanism to monitor, evaluate, and report 
results; and reinforcing individual accountability for collaborative 
efforts through performance management systems. Adopting each of these 
key practices could enhance the agencies' collaboration, and the 
effectiveness of both the HUD-FTA action plan and the Partnership for 
Sustainable Communities. 

* For example, in each of the interagency efforts, strategies and 
recommendations call for increasing research and development between 
the agencies. In the HUD-FTA action plan, the agencies have identified 
eight specific topics for joint research to include development of 
tools, techniques, and methods for addressing housing and 
transportation expenditures, improving the use of geographical 
information systems, and monitoring and assessing the effectiveness of 
policies and tools that have been deployed to promote mixed-income 
housing in transit-oriented developments. To facilitate this 
collaboration, the agencies need to address the compatibility of 
standards, policies, procedures, and data systems that will be used. 
However, according to HUD and FTA officials, there has been no 
assessment on whether any compatibility exists or can be established. 

* The HUD-FTA action plan calls for the joint HUD-FTA working group to 
develop performance measures and an associated management information 
system which, in part, would require that HUD and FTA determine if 
there are reliable data available for assessing the effectiveness of 
the results of joint actions taken by the two agencies. This is in line 
with a key practice to develop a mechanism to monitor, evaluate, and 
report results. In addition, we have previously reported that the 
annual performance planning processes under the Government Performance 
and Results Act (GPRA) allow agencies to foster greater collaboration 
by ensuring that collaborating agencies' individual program goals are 
complementary and, as appropriate, common performance measures are 
used.[Footnote 68] However, agency officials reported that there has 
been no effort to establish a monitoring system or to determine whether 
current data systems would be able to provide reliable data that would 
be needed to identify areas for improvement. In addition, as we stated 
above, the current scarcity of reliable housing data and limitations on 
transit modeling would need to be addressed to make sure the agencies 
develop an effective performance measurement system. 

* Agencies can strengthen collaboration by reinforcing individual 
accountability through their performance management systems. HUD and 
DOT officials stated they have not implemented any changes to their 
performance management systems to reflect better coordination efforts 
between their respective agencies' staffs. 

Inherent to each of these eight practices, factors such as leadership 
and trust are key to establishing collaborative working relationships. 
These factors can foster a collaborative culture and therefore help 
agencies overcome the barriers they face when they attempt to 
collaborate. In addition to these eight practices, there are other 
management tools available that can foster greater collaboration among 
federal agencies. For example, GPRA, with its focus on strategic 
planning, the development of long-term goals, and accountability for 
results, provides a framework that Congress, the Office of Management 
and Budget, and executive branch agencies can use to consider the 
appropriate mix of long-term strategic goals and strategies needed to 
identify and address federal goals that cut across agency boundaries. 

Conclusions: 

One way to assist lower-income households, which are generally more 
transit dependent and thus more vulnerable to increased housing and 
transportation costs, is to increase the availability of affordable 
housing in transit-oriented developments. Since state and local 
governments are the main providers of affordable housing and transit 
services, they are on the front line of this issue. From our site 
visits and review of relevant studies, we found that some communities 
have programs and policies that specifically promote affordable housing 
in transit-oriented developments, but most do not. Therefore, many 
communities that choose to build or preserve affordable housing near 
transit-oriented developments rely on broader affordable housing 
programs and other incentives that can be used wherever the development 
is located. 

With HUD and FTA focusing on their individual core missions and, until 
recently, promoting affordable housing and transit separately, these 
agencies have not generally attempted to link federal housing and 
transportation programs. Furthermore, while there are federal 
requirements for both housing and transportation planning, 
traditionally these plans have not been integrated. In fact, some 
program requirements (such as the LIHTC) may limit the development of 
affordable housing in transit-oriented developments. Starting in 2005, 
HUD and FTA have collaborated to develop strategies for better 
coordination of their respective programs with the goal of helping to 
provide more affordable housing in transit-oriented developments. The 
strategies that HUD and FTA, and more recently DOT, have developed are 
in line with what housing and transit stakeholders have stated can 
assist local communities, and address some current weaknesses we found 
in the two agencies' independent programs and policies. While these 
strategies have the potential to assist local communities better link 
housing and transportation programs, only a few strategies--such as the 
best practices manual--have the potential to provide assistance in the 
near term. Many strategies, such as identifying regulatory barriers and 
financial incentives, still require additional research and analysis 
and others have only just been announced. In particular, any areas that 
may require congressional action to revise current statutory 
requirements may require the agencies to take additional steps. Without 
an implementation plan for each strategy, however, DOT and HUD run the 
risk of losing momentum. Given the number of steps and time it may take 
to implement the various strategies, including the proposed new 
regional planning grants, it will be important to establish an 
implementation plan that encompasses the various strategies in order 
for HUD and DOT to be better positioned to implement each of their 
strategies as their interagency efforts progress. The scarcity of 
reliable housing data and the limitations on transit modeling also 
limit the ability of DOT, HUD, and FTA to determine whether current and 
future efforts are ensuring the availability of affordable housing in 
transit-oriented developments. Therefore, without development of better 
data and data systems, which are key elements of any performance 
measurement system, the agencies will not have the information 
necessary to determine, among other things, whether they need to 
increase coordination or adjust existing strategies. 

In addition, when comparing the agencies' collaboration to the key 
practices we have previously identified, we found that the agencies 
have taken actions that are consistent with some of the practices. 
However, the agencies had not taken actions on a number of practices-- 
such as reinforcing individual accountability for collaborative efforts 
or developing mechanisms to monitor, evaluate, and report on results. 
Furthermore, without a formal approach to collaboration for all of the 
key practices, DOT, HUD, and FTA may miss opportunities to effectively 
leverage each other's unique strengths to promote affordable housing in 
transit-oriented developments. 

Recommendations for Executive Action: 

To strengthen formal collaboration efforts, we recommend that the 
Secretary of Transportation should direct the Administrator of the 
Federal Transit Administration, and the Secretary of Housing and Urban 
Development should direct the appropriate program offices, to take the 
following three actions: 

* Develop and publish an implementation plan for interagency efforts to 
promote affordable housing in transit-oriented developments, to include 
the HUD-FTA action plan and the Partnership for Sustainable 
Communities. This plan should include, but not be limited to, a project 
schedule, resource allocation, outreach measures, and a performance 
measurement strategy. 

* Develop a plan to ensure that data collected on the various programs 
of the agencies related to affordable housing and transit are 
sufficient to measure the agencies' performance toward goals and 
outcomes established in the HUD-FTA action plan and the Partnership for 
Sustainable Communities. 

* Adopt a formal approach to encourage further collaboration in 
promoting affordable housing in transit-oriented developments. Such an 
approach could include establishing and implementing a written 
agreement to include defining and articulating a common outcome; 
establishing mutually reinforcing or joint strategies; identifying and 
addressing needs by leveraging resources; agreeing on agency roles and 
responsibilities; establishing compatible policies, procedures, and 
other means to operate across agency boundaries; reinforcing agency 
accountability for collaborative efforts through agency plans and 
reports; and reinforcing individual accountability for collaborative 
efforts through performance management systems. 

Agency Comments and Our Evaluation: 

We provided draft copies of this report to the Secretary of 
Transportation and the Secretary of Housing and Urban Development for 
their review and comment. DOT generally agreed to consider the 
recommendations in this report, and provided technical comments, which 
we incorporated, as appropriate. We also received technical comments 
from HUD that we have incorporated as appropriate. In written comments, 
HUD's Director of the Office of Departmental Operations and 
Coordination stated that HUD would consider the findings and 
recommendations of the report carefully as the agency continues its 
efforts to combine housing and transportation funds and resources near 
transit. The Director's letter is reprinted in appendix IV. Discussed 
below are the additional comments HUD had with certain aspects of the 
report and our response. 

First, HUD stated that the definition of affordable housing used in the 
report is overly narrow in that we focused on subsidized housing and 
that affordable housing goes beyond subsidized housing for low-and 
moderate-income families. However, the definition of affordable housing 
used in the draft report is not limited to subsidized housing. Nor does 
the report suggest that subsidized housing is the only source of 
affordable housing; however, as we state in the report, national data 
on all affordable housing in transit-oriented developments are limited 
and there has been little research that specifically links transit- 
oriented developments to affordable housing. HUD also noted that we did 
not sufficiently look at the combined cost of housing and 
transportation, as a measure of affordability. We agree that the 
combined costs of housing and transportation are an important indicator 
of housing affordability and noted in our draft report that some 
organizations have worked to establish a link between housing and 
transportation costs by developing new measures of affordability. 
However, determining transit-oriented developments' effects on 
affordability--as defined by combined housing and transportation costs--
is complicated due to a lack of national data including reliable data 
on subsidized housing. 

Second, HUD commented that it has made significant progress on 
coordinating housing and transportation under the Partnership on 
Sustainable Communities. HUD cited some specific actions it has taken, 
including developing the six livability principles announced in June 
and creating four working groups to implement the partnership. While 
our draft report did mention these efforts and recognized other actions 
the agencies have taken consistent with some of the key practices for 
collaboration, we have added some additional discussion of the six 
livability principles and the four working groups. However, we believe 
that we correctly assessed the level of progress made by the agencies 
and maintain that to sustain their initial efforts, it will be 
important for the agencies to meet the principles of interagency 
collaboration, which we discuss in the report. 

Lastly, HUD noted that we overstated the issues associated with 
accuracy of HUD data on subsidized households. HUD stated in its 
comments that the data collected on subsidized housing are primarily 
intended for administrative purposes and may be sufficiently reliable 
for administrative purposes. We acknowledge in our report that HUD 
officials told us that the data are collected primarily for 
administrative purposes but we did not evaluate the reliability for 
those purposes. Rather, we discuss the data's limitations for 
monitoring, evaluating, and reporting results related to understanding 
the impact of transit-oriented development on the availability of 
certain affordable housing. In the report, we provide multiple reasons 
why we believe the data have gaps and inconsistencies beyond those 
associated with the Moving to Work program that make their use for 
geographic analysis limited. Reliable geographic information will be 
important for the department to measure the impact of its programs and 
make adjustments to those programs to ensure the availability of 
certain affordable housing in transit-oriented developments. 

As arranged with your office, unless you publicly announce its contents 
earlier, we plan no further distribution of this report until 15 days 
after the date of this letter. At that time, we will send copies of 
this report to congressional committees with responsibilities for 
surface transportation and housing programs; DOT officials, including 
the Secretary of Transportation and the Administrator of FTA; and HUD 
officials, including the Secretary of Housing and Urban Development. 
This report will also be available on our home page at no charge at 
[hyperlink, http://www.gao.gov]. 

If you have any question about this report, please contact us by e-mail 
at wised@gao.gov or by telephone at (202) 512-2834 or by e-mail at 
sciremj@gao.gov or by telephone at (202) 512-8678. Contact points for 
our Offices of Congressional Relations and Public Affairs may be found 
on the last page of this report. GAO staff who made key contributions 
to this report are listed in appendix IV. 

Sincerely yours, 

Signed by: 

David Wise: 
Director, Physical Infrastructure Issues: 

Signed by: 

Mathew J. Scirè: 
Director, Financial Markets and Community Investment Issues: 

[End of section] 

Appendix I: Scope and Methodology: 

To identify how transit-oriented developments affect the availability 
of affordable housing, we reviewed reports and studies issued by 
federal, state, and local agencies; transportation research 
organizations; and academia, as well as our past work in surface 
transportation and affordable housing. A GAO economist reviewed 
relevant reports and studies, which were identified by searching 
economics, housing, and transportation literature, and found their 
methodology and economic reasoning to be sound and sufficiently 
reliable for our purposes. 

To identify how local, state, and federal agencies have worked to 
ensure that affordable housing, including housing subsidized through 
Department of Housing and Urban Development (HUD) programs, is 
available in and near transit-oriented developments, we interviewed 
Department of Transportation (DOT), Federal Transit Administration 
(FTA) officials, and HUD officials. We also conducted 11 site visits or 
interviews with state and local transportation and housing officials in 
Mesa, Phoenix, and Tempe, Arizona; Sacramento, California; Chicago, 
Illinois; Cleveland, Ohio; Jersey City and Hoboken, New Jersey; 
Portland, Oregon; Washington, D.C.; and Arlington, Virginia. We 
selected this nongeneralizable sample of metropolitan areas based on 
experience with transit-oriented development and if the area had 
received New Starts federal funding for construction of a local fixed- 
guideway transit system, and geographical diversity. During these site 
visits, we interviewed federal, state, and local housing and 
transportation officials and toured transit-oriented developments. In 
addition, we reviewed studies and documentation on how these and other 
metropolitan areas and states have promoted transit-oriented 
developments. 

To identify to what extent do HUD, DOT, and FTA work together to ensure 
that transportation and affordable housing objectives are integrated in 
transit-oriented development projects, we reviewed documentation 
describing the collaborative efforts. We examined the mechanisms (e.g. 
interagency agreements, task force agendas, etc.) the agencies used to 
collaborate. Additionally, we interviewed agency officials on their 
knowledge of any past or future collaborative effort. 

To determine what opportunities exist to enhance collaboration between 
HUD, DOT, and FTA, we reviewed our prior work on key practices that can 
help enhance and sustain collaboration and address barriers to more 
effective collaboration. We also obtained the views of agency 
officials, local housing and transit providers, transportation 
organizations, and nonprofit housing organizations with experience in 
developing, implementing, or analyzing these issues. Finally, we 
compared the agencies' collaboration efforts with key practices that 
can help federal agencies enhance and sustain their collaborative 
efforts. 

We conducted this performance audit from August 2008 to September 2009, 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe that 
the evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. 

[End of section] 

Appendix II: Types of Locations that Could Have Transit-Oriented 
Developments: 

Type: Regional center; 
Definition: Regional centers are the primary centers of economic and 
cultural activity in any region. These are the regional downtowns, and 
are characterized by a dense mix of housing and employment types, 
retail, and entertainment that cater to the regional market. They are 
served by a rich mix of transit modes that support all this activity, 
including high-capacity regional rail and bus, and local-serving bus. 

Type: Urban center; 
Definition: Urban centers contain a mix of residential, employment, 
retail, and entertainment uses, usually at slightly lower densities and 
intensities than in regional centers. Destinations draw residents from 
surrounding neighborhoods. These centers serve as commuter hubs for the 
larger region and are served by multiple transit options, often 
including rail and high-frequency regional bus or bus rapid transit, as 
well as local-serving bus. 

Type: Suburban center; 
Definition: Suburban centers contain a mix of residential, employment, 
retail, and entertainment uses, usually at intensities similar to that 
found in urban centers but lower than that in regional centers. 
Suburban centers can serve as both origins and destinations for 
commuters. They are typically connected to the regional transit network 
and include a mix of transit types--regional rail and bus, bus rapid 
transit, and local bus--with high-frequency service. 

Type: Transit town center; 
Definition: Transit town centers function more as local-serving centers 
of economic and community activity than either urban or suburban 
centers, and they attract fewer residents from the rest of the region. 
A variety of transit modes serve transit town centers, and there is a 
mix of origin and destination trips--primarily commuter service to jobs 
in the region. There is less secondary transit service when compared to 
regional centers, urban centers, or suburban centers. Secondary transit 
lines feed primary lines, often at intervals timed to facilitate 
transfers at the primary transit stations. 

Type: Urban neighborhood; 
Definition: Urban neighborhoods are primarily residential areas that 
are well-connected to regional centers and urban centers. Densities are 
moderate to high, and housing is usually mixed with local-serving 
retail. Commercial uses are limited to small businesses or some 
industry. Development is usually oriented along a well-connected street 
grid that is served by a secondary transit network. Transit is often 
less a focal point for activity than in the "center" types of 
locations, and stations may be located at the edge of two distinct 
neighborhoods. 

Type: Transit neighborhood; 
Definition: Transit neighborhoods are primarily residential areas that 
are served by rail service or high frequency bus lines that connect at 
one location. Densities are low to moderate and economic activity is 
not concentrated around stations, which may be located at the edge of 
two distinct neighborhoods. Secondary transit service is less frequent 
and less well connected. There is often not enough residential density 
to support much local-serving retail, but there are often retail nodes. 

Type: Special use or employment district; 
Definition: Special-use or employment districts are often single use--
either they are low to moderate density employment centers, or are 
focused around a major institution such as a university, or an 
entertainment venue such as a stadium. Transit stations are not a focus 
of economic activity. Secondary transit service is infrequent and 
focused on stations; development tends to be more recent and the street 
grid may be less connected than in older neighborhoods. 

Type: Mixed-use corridor; 
Definition: Mixed-used corridors are a focus of economic and community 
activity but have no distinct center. These corridors are typically 
characterized by a mix of moderate-density buildings that house 
services, retail, employment, and civic or cultural uses. Many were 
developed along streetcar lines or other transit service. Mixed-use 
corridors are especially suitable for streetcars, bus rapid transit or 
other high-quality bus service with closely spaced stops. 

Source: GAO summary of information from Reconnecting America and the 
Center for Transit-Oriented Development report on transit-oriented 
development. 

[End of table] 

[End of section] 

Appendix III: Examples of LIHTC Programs that Award Points for 
Proximity to Transit or Transit-Oriented Developments: 

Arizona: 
Awards 10 points for projects located within the Phoenix or Tucson 
Metropolitan Statistical Areas that demonstrate indicators of 
sustainable development or transit-oriented development, including 
locating the project within 1 mile or less from a mass transit route or 
light rail line. 

California: 
Awards 7 points for projects part of a transit-oriented development 
strategy where there is a transit station, rail station, commuter rail 
station, or bus station, or bus stop within one-fourth mile from the 
site with service at least every 30 minutes during the hours of 7 to 9 
a.m. and 4 to 6 p.m., and the project's density will exceed 25 units 
per acre. 

Georgia: 
Awards 3 points for projects designated as a transit-oriented 
development by a rapid transit authority or projects located within one-
fourth mile walking distance of a rapid rail transit station along 
paved roads, sidewalks, established pedestrian walkways, or bike 
trails. 

Illinois: 
Awards 1 point for projects that are part of a transit-oriented 
development strategy (located within four blocks) of a regular bus 
route, or to a rapid transit system stop, etc. 

Maryland: 
Awards 5 points for projects that are part of a transit-oriented 
development--which is defined as having a density that exceeds 25 units 
per acre, involves mixed-use or is part of a larger mixed-use 
undertaking, and involves good nonmotorized transport design 
(walkability)--and are located within one-half mile of a mass or public 
transit or rail station, or are located within one-fourth mile of a bus 
depot or bus stop with scheduled service at intervals at most 30 
minutes between the hours of 6:30 a.m. and 7:00 p.m. Awards 6 points 
for projects in which the buildings and the project site, including the 
nearby surroundings, provide opportunities for recreation, education, 
convenient access to mass transit or rail systems, and community 
activities. 

New Jersey: 
Awards 10 points for projects that are located within a transit 
village. "Transit village" refers to a designation given by the New 
Jersey Department of Transportation to communities with a bus, train, 
light rail, or ferry station that has developed a plan to achieve its 
goals of transit-oriented development. The transit village program is 
designed to spur economic development, urban revitalization, and 
private-sector investment around passenger rail stations. Awards 1 
point for projects located within one-half mile of public 
transportation. 

Nevada: 
Awards 1 point for projects within one-fourth mile of local transit 
route. 

Texas: 
Awards 4 points to projects located within one-fourth mile of public 
transportation that is accessible to all residents including persons 
with disabilities and/or located within a community that has "on 
demand" transportation, special transit service, or specialized elderly 
transportation for qualified elderly developments. 

Source: GAO analysis of selected state Qualified Allocation Plans. 

[End of table] 

[End of section] 

Appendix IV: Comments from the Department of Housing and Urban 
Development: 

U.S. Department Of Housing And Urban Development: 
Washington, DC 20410: 
[hyperlink: http://www.hud.gov] 

August 28, 2009: 

Mr. Mathew Scire: 
Director, Financial Markets and Community Investment: 
U.S. Government Accountability Office: 
Washington, DC 20548: 

Dear Mr. Scire: 

Thank you for the opportunity to comment on the Government 
Accountability Office (GAO) draft report GAO-09-871, "Affordable 
Housing in Transit Oriented Development. Key Practices Could Enhance 
Recent Collaborations among DOT, PTA and HUD." 

The topic of this report, expanding the availability of affordable 
housing near transit, is a top priority for this administration. In 
March of this year, HUD initiated a significant new partnership with 
DOT, and requested $150 million for a new Sustainable Communities 
Initiative in our FY 2010 budget. In a short amount of time since 
taking office we have made extraordinary progress through the work of 
our Partnership for Sustainable Communities on expanding coordination 
between HUD, DOT, and, more recently, the Environmental Protection 
Agency. 

We are pleased with the response so far of the House and Senate 
Appropriations Committees to our FY 2010 budget request, as well as the 
significant progress we have made since the start of the new 
Administration on aligning HUD and DOT programs. We have established a 
high-level Interagency Task Force, which has created four working 
groups to address the issues raised in the GAO report, have agreed on 
core Livability Principles that will provide a framework for our work, 
and are in the process of finalizing a Work Plan to implement the 
partnership's programs. We expect to finalize the Work Plan within the 
next thirty days. 

GAO Findings: 

GAO's findings were inconclusive on the issue of whether transit 
oriented development adds to the cost of housing near transit. GAO 
found that due to a lack of direct research and data, determining the 
effects of TOD on housing is" complicated" and that in some cases (e.g. 
lowincome areas in Buffalo) housing values actually declined near 
transit. 

GAO also found few federal, state and local programs that are 
specifically targeted to developing affordable housing near transit, 
and that while HUD and FTA programs allow affordable housing near 
transit, there are few direct incentives housing in transit rich 
locations. 

GAO also assessed the progress of three partnerships that have been 
established between HUD and DOT since 2005, most recently the 
Sustainable Communities Partnership that HUD established with DOT in 
March of this year (and expanded to include EPA in June, 2009). GAO 
acknowledges progress in 5 of 8 "key practices" to enhance and 
sustainable collaborative efforts, but recommends that these should be 
formalized in a variety of ways. GAO also was concerned that HUD's data 
on subsidized housing were not sufficiently accurate to "provide a full 
and accurate picture of the availability of subsidized housing" near 
transit. 

HUD Comments: 

In addition to the technical comments submitted separately we have the 
following comments on areas of the report where GAO did not accurately 
address the issues: 

* GAO's definition of affordable housing is overly narrow. The issue of 
housing affordability near transit goes beyond subsidized housing for 
low and moderate income families. However, the only measure of 
affordability that GAO focused on was that of subsidized housing. GAO 
did not sufficiently look at the availability of market rate affordable 
housing to working families, and the extent to which its availability 
is impacted by transit or transit oriented development.
More importantly, GAO failed to look at the combined cost of housing 
and transportation, as a measure of affordability (beyond a footnote on 
p. 2). The combined cost of housing and transportation may provide a 
better indication of the "true" cost of housing, in that the cost of 
housing near transit may be higher locations without access to transit, 
but this must be balanced against the relatively lower costs of 
transportation. These broader market trends are an important indicator 
of housing affordability, not just for low-income households but for 
moderate or middle income households who may not be able to afford to 
live near transit if housing costs are too high. We believe that in 
order to fully understand affordability trends, it will be critical to 
look at the combination of housing and transportation expenses for all 
income groups. 

* Significant progress has been made on coordinating housing and 
transportation under the new Administration's Partnership on 
Sustainable Communities. As noted above, coordination of housing and 
transportation has been one of the highest HUD priorities since this 
Administration took office in January. We included this topic as a 
significant new element in our FY 2010 budget, and are pleased with 
Congress' response so far to this request. HUD Secretary Donovan and 
DOT Secretary LaHood testified twice before Congress on this issue, on 
March 18 before the House Appropriations Subcommittee on Transportation 
and Housing and Urban Development, and again on June 16 before the 
Senate Banking Committee when they were joined by EPA Administrator 
Jackson. 

GAO only briefly references the six livability principles announced in 
June, which provides a new template for HUD, DOT and EPA to jointly 
address environmental, transportation and housing issues-the first such 
effort for federal agencies to establish a shared framework for future 
action and collaboration. GAO also does not describe the four Working 
Groups that have been created to implement the partnership, the 
progress that has been made in identifying barriers to coordinated 
housing and transportation investments, and the work that has begun on
developing detailed performance measures that will provide metrics for 
measuring the success of the initiative in local communities. In 
addition, a Work Plan has been drafted, and is close to being finalized.
GAO overstates the issues associated with accuracy of HUD data on 
subsidized households for this study. While additional improvements can 
be made in improving the geocoding of the data reported by public 
housing authorities to HUD - and we are committed to making these 
improvements - we believe that HUD generally has current and good 
information on the location of HUD-subsidized units for the 
administrative purpose for which the data is being collected. Data 
collected is primarily intended to he used for administrative purposes 
and several issues prevent reliable long-term data analysis. However, 
there were gaps that GAO encountered for certain communities for the 
period of this study: 32 PHAs were not required to submit data for 
housing choice vouchers or public housing units from 2000 to 2006 due 
to participation in the Moving to Work program. All housing authorities 
are currently required to report, so that those gaps no longer exist. 

GAO Recommendations: 

GAO recommended three actions to "strengthen formal collaboration" 
between HUD and DOT: (1) publishing an implementation plan for both the 
HUD-FTA action plan and the Partnership for Sustainable Communities; 
(2) developing a plan to improve data quality to enhance performance 
measurement; and (3) adopting a "formal approach" to promoting 
affordable housing in transit oriented developments.
Please note that we are already in the process of implementing these 
recommendations, in that, as noted above, a detailed three-agency 
implementation plan is close to being finalized, and we are continuing 
to formalize the partnership with DOT and EPA through a variety of 
other means, using the two partnership agreements announced in March 18 
and June 16 as the starting point. Table 4 in the report - which 
includes eight practices recommended by GAO for sustainable interagency 
collaboration - provides an excellent framework for formalizing these 
efforts. Our FY 2010 budget also includes a request for significant 
enhancements of HUD's data systems. 

Accordingly, we will consider your findings and recommendations 
carefully as we continue our efforts to combine housing and 
transportation funds and resources near transit, and more broadly to 
address the interest of Congress and the affordable housing industry in 
sustainable community development. 

Sincerely, 

Signed by: 

Inez Banks-DuBose, Director: 
Office of Departmental Operations and Coordination: 

[End of section] 

Appendix V: GAO Contacts and Staff Acknowledgments: 

GAO Contacts: 

David Wise (202) 512-2834 or wised@gao.gov Mathew Scirè (202) 512-8678 
or sciremj@gao.gov: 

Staff Acknowledgments: 

In addition to the individuals named above, Raymond Sendejas, Assistant 
Director; Paul Schmidt, Assistant Director; Lauren Calhoun; Melinda 
Cordero; Delwen Jones; Anar Ladhani; Terence Lam; Matthew LaTour; Sara 
Ann Moessbauer; Josh Ormond; Andrew Pauline; Linda Rego; and Tim 
Schindler made key contributions to this report. 

[End of section] 

Footnotes: 

[1] Mixed-use development mixes residential, commercial, cultural, or 
institutional uses on the same site which can allow for greater housing 
density; encourage more compact development; and promote pedestrian- 
friendly environments. 

[2] Fixed-guideway systems are permanent transit facilities that may 
use and occupy a separate right-of-way for the exclusive use of public 
transportation services. These fixed-guideway systems include rail 
(light, heavy, commuter, and streetcar) and may include busways (such 
as bus rapid transit). 

[3] For purposes of this report, affordable housing refers to housing, 
either for purchase or for rent, which is affordable to people with low 
to moderate incomes. HUD and others define affordability in terms of 
the proportion of a households income that goes toward housing. HUD 
defines low and moderate income as a certain percentage of the area's 
median income. 

[4] We are defining subsidized housing as housing in which financial 
assistance is provided to property owners or to tenants so as to make 
housing affordable for people with low to moderate incomes. The 
financial assistance may be provided by entities such as a federal or 
state agency. 

[5] Other organizations have worked to establish the link between 
housing and transportation by developing new measures of affordability. 
For example, an affordability index was developed by the Center for 
Transit-Oriented Development (which is funded by FTA), the Center for 
Neighborhood Technology, and the Brookings Institution's Urban Market 
Initiatives program. The affordability index calculates the true 
affordability of a home based on its market value and the 
transportation costs incurred by its location. 

[6] Livable Communities, Transit-Oriented Development, and 
Incorporating Green Building Practices into Federal Housing and 
Transportation Policy: Hearing before the Subcomm. on Transportation, 
Housing and Urban Development, and Related Agencies, House of 
Representatives Comm. on Appropriations, 111th Congress (Mar. 18, 2009) 
(statements of Shaun Donovan, Secretary, Department of Housing and 
Urban Development and Ray LaHood, Secretary, Department of 
Transportation). 

[7] For purposes of this report, we refer to New Starts as new fixed- 
guideway and fixed-guideway extensions, fixed guideway modernization, 
and certain bus-related programs in accordance with 49 U.S.C. § 
5309(b). 

[8] FTA formula programs, such as the Transit Capital Assistance 
program, are also eligible to fund rehabilitation and modernization of 
fixed-guideway systems. 

[9] Specifically, in an explanatory statement accompanying the 2008 
Consolidated Appropriations Act published by the Chairman of the 
Committee on Appropriations of the House of Representatives, the 
Appropriations Committees directed FTA and HUD to develop a best 
practices manual to help communities establish mixed-income transit- 
oriented developments. Further, the statement indicated that FTA and 
HUD should jointly report to the Committees on Appropriations of the 
House of Representatives and the Senate on new and better ways they 
could coordinate transportation and housing programs to promote 
affordable housing near transit. 153 Cong. Rec. H15741, H16497, and 
H16562 (Dec. 17, 2007). 

[10] Light rail transit is defined as a metropolitan-electric railway 
system characterized by its ability to operate in a variety of 
environments such as streets, subways, or elevated structures. Light 
rail systems typically use an overhead source for electrical power, can 
operate on streets with other traffic, and boarding takes place from 
the street or platforms. Heavy rail transit systems operate on a 
totally separated right-of-way, use a third rail on the ground to power 
the trains, require platform boarding, and typically have longer 
distances between stations and have greater capacity than light rail 
systems. 

[11] Metropolitan planning organizations are federally mandated 
regional organizations responsible for comprehensive transportation 
planning and programming in urbanized areas with a population of 50,000 
or more and are required by federal law to develop regional 
transportation plans. 

[12] The current framework for federal participation in surface 
transportation is set forth in authorizing legislation, most recently 
amended by the Safe, Accountable, Flexible, Efficient, Transportation 
Equity Act: A Legacy for Users (SAFETEA-LU). These pieces of 
legislation have established an overall approach for surface 
transportation planning and decision making that generally gives local 
and state governments significant responsibilities for these activities 
in their own regions. For example, 23 U.S.C. § 134 establishes specific 
planning task requirements that metropolitan planning organizations, in 
conjunction with states, public transportation operators, and other 
stakeholders, must perform, which include (1) developing long-and short-
range transportation plans and transportation improvement programs, (2) 
specifying financing for the transportation plan, and (3) involving a 
wide range of stakeholders in the process that emphasizes consultation 
and coordination. 

[13] LIHTC is administered by the Internal Revenue Service based on 
section 42 of the Internal Revenue Code, which was enacted by Congress 
in 1986 to provide the private market with an incentive to invest in 
affordable rental housing. 

[14] HUD generally requires states, cities, and counties to prepare a 5-
year Consolidated Plan and a 1-year Action Plan that together identify 
long-range housing needs, as well as short-term funding priorities for 
HUD's formula grant programs. 24 C.F.R. pt. 91 

[15] Under the New Starts program, the Secretary has the authority to 
provide funding for new and extensions to existing fixed guideway 
systems--done through a competitive process--as well as fixed guideway 
modernization and bus-related projects. In addition to New Starts, 
SAFETEA-LU established the Small Starts program for lower-cost fixed- 
guideway capital projects, which may include a corridor-based bus 
capital project. Small Starts projects are defined as those projects 
that request less than $75 million in New Starts funding and have a 
total estimated net capital cost of less than $250 million. FTA also 
subsequently introduced a subset of the Small Starts program called the 
Very Small Starts program for projects that have a total capital cost 
of less than $50 million. 

[16] The Highway Trust Fund is divided into two major accounts: the 
Highway Account and the Mass Transit Account. A portion of federal fuel 
taxes (2.86 cents of the 18.4 cents federal gas tax) is deposited into 
the Mass Transit Account. 

[17] Area median income--sometimes also referred to as median family 
income--limits are published annually by HUD and are used to determine 
eligibility of applicants in federal and local affordable housing 
programs. 

[18] A tenant's rent is based on a household's anticipated gross annual 
income--that is, income from all sources received by the family head, 
spouse, and each additional family member who is 18 years of age or 
older, less applicable exclusions and deductions. 

[19] Our literature review included eight studies, four of which 
included extensive reviews of previously published literature. These 
eight studies are representative of the general research findings that 
the value of property is positively correlated with the presence of a 
transit station. These studies, conducted between 1978 and 2008, 
examined primarily residential property using sales data on single- 
family homes, condominiums, or apartment rents in varying areas and, as 
a result, estimates of land or housing values with respect to transit 
development vary. A 2008 report from the Center for Transit-Oriented 
Development said that increased asking prices for property along 
planned light rail corridors have been observed in several areas, 
including the Twin Cities, Houston, Denver, and Charlotte. See 
Reconnecting America's Center for Transit-Oriented Development, 
Capturing the Value of Transit, November 2008. 

[20] Landis, John, Robert Cervero, Subhrajit Guhathukurta, David 
Loutzenheiser, and Ming Zhang. Rail Transit Investments, Real Estate 
Values, and Land Use Change: A Comparative Analysis of Five California 
Rail Transit Systems. Monograph 48, Institute of Urban and Regional 
Studies, University of California at Berkeley (1995). 

[21] Pollution can also potentially negatively affect land and housing 
values. See for example, Kenneth Chay and Michael Greenstone. "Does Air 
Quality Matter? Evidence from the Housing Market," Journal of Political 
Economy, vol. 113, no. 2 (2005). 

[22] Bowes, D. R. and K.R. Ihlanfeldt. "Identifying the Impacts of Rail 
Transit Stations on Residential Property Values,î Journal of Urban 
Economics, vol. 50 (2001): pp. 1-25. 

[23] Daniel Baldwin Hess and Tangerine Maria Almeida. "Impact of 
Proximity to Light Rail Rapid Transit on Station-area Property Values 
in Buffalo, New York," Urban Studies, vol. 44 (2007): p. 1041. 

[24] Affordability is often defined as housing cost as a percentage of 
household income, therefore higher land values can affect affordability 
if income remains constant. 

[25] Reconnecting America and the National Housing Trust, Preserving 
Opportunities: Saving Affordable Homes Near Transit, 2007. 

[26] HUD's project-based Section 8 program subsidizes the rent of low- 
income individuals through contracts between HUD and multifamily 
property owners. The subsidies keep rents in Section 8 properties 
affordable to households earning at or below 80 percent of AMI. 

[27] Infill refers to redevelopment of vacant or underutilized property 
in urbanized areas. 

[28] According to some research, transit-oriented developments often 
take years, if not decades, to fully develop. The effect land and 
housing values might have on affordable housing may not be fully 
realized until years after the transit station opens. 

[29] Local travel models are used to forecast travel demand for transit 
projects, which is then used in calculating transportation system user 
benefits for New Starts projects. 

[30] HUD officials told us that this is in part because changes were 
made to the reporting form for the Moving to Work program and there was 
initial confusion among PHAs about the requirement. In addition, HUD 
officials told us that missing geographic data were not random 
throughout the database, and that the reasons for the differences 
varied. Moreover, HUD told us that the accuracy of the geographic data 
is of significantly less quality prior to 2000. 

[31] Moving to Work is a HUD demonstration program that allows PHAs to 
design and test ways to promote self-sufficiency among assisted 
families, achieve programmatic efficiency and reduce costs, and 
increase housing choice for low-income households. 

[32] GAO, Highway and Transit Investments: Options for Improving 
Information on Projects' Benefits and Costs and Increasing 
Accountability for Results, [hyperlink, 
http://www.gao.gov/products/GAO-05-172] (Washington, D.C.: July 25, 
2008). 

[33] In 2006, voters in the State of California passed the Housing and 
Emergency Shelter Trust Fund Act of 2006 which allocated $2.85 billion 
for housing and development programs, including affordable housing in 
transit-oriented developments. Cal. Health & Safety Code §§ 53560 et 
seq. (2009). 

[34] Affordable housing units must be affordable to persons of very low 
and low income for a period of at least 55 years. 

[35] See Or. Rev. Stat. § 307.600 (2009). 

[36] The total points which applicants can earn vary across QAPs. For 
example, applicants can earn up to 63 points in New Jersey and up to 
146 points in California. We did not examine the extent to which 
applicants or state housing finance agencies believed a certain number 
of points for proximity to transit would make a difference in 
applicants' prospects for success in receiving LIHTCs. 

[37] The New Jersey Transit Village Initiative is a coordinated effort 
by the state's various agencies including housing and transit to 
establish transit-oriented developments throughout the state. 

[38] If the development is located in a HUD-designated high cost area 
(HCA), the state allocating agency may award up to 30 percent 
additional LIHTCs. These areas include both Qualified Census Tracts 
(QCT) and Difficult Development Areas (DDA). In a QCT, 50 percent or 
more of the households have incomes of less than 60 percent of AMI. 
DDAs are designated according to a HUD comparison of housing costs with 
incomes for each area. Section 3003(a) of the Housing and Economic 
Recovery Act of 2008 amended section 42(d)(5) of the Internal Revenue 
Code and allowed certain state-designated buildings to be treated as 
being located in a DDA and qualify for additional LIHTCs. 26 U.S.C. § 
42(d)(5)(B)(v). To quality for this special treatment, the building 
must be designated by the state as requiring the enhanced credit in 
order to be financially feasible as part of the low-income housing 
project. 

[39] Other programs include mortgage insurance programs that provide 
federal loan guarantees to support the construction of new apartment 
projects and the refinancing of the rehabilitation of older ones. 

[40] Fair market rents are determined annually by HUD. 

[41] Notice of Funding Availability for fiscal year 2009 for the 
Neighborhood Stabilization Program 2 under the American Recovery and 
Reinvestment Act, 2009, No. FR 5321-C-01, 28 (May 4, 2009) (the 
Notice); Pub. L. No. 111-5, 123 Stat. 115. 

[42] According to the Notice, transit accessible is defined as being in 
a census tract with convenient bus service (local bus service every 20 
minutes during rush hour or an express commuter bus) or being or 
bordering a census tract with a passenger rail stop or station 
(including, for example, commuter rail, subway, light rail, and 
streetcars). 

[43] Local transit agencies can use all types of federal transit funds 
for the Joint Development Program including New Starts funding, formula 
grants, and flexible funding programs. 

[44] In addition, according to FTA officials, transportation and 
transit planning studies that include transit-oriented development and 
joint development are eligible for funding under FTA formula programs. 
FTA's Metropolitan Planning Program (49 U.S.C. § 5305(d)) and the State 
Planning and Research Program (49 U.S.C. § 5305(e)). 

[45] According to FTA officials, FTA does not maintain a national 
database of approved joint development projects. 

[46] FTA has previously stated that the mobility improvements criterion 
is used as a tiebreaker. Additionally FTA has taken steps to address 
the consideration of economic development and the weight to be accorded 
to it and other statutory New Starts criteria. In a Federal Register 
notice published on January 26, 2009, FTA issued and sought comments on 
a discussion paper on new ways of evaluating economic development 
effects. See 74 Fed. Reg. 4502 (Jan. 26, 2009). FTA is now reviewing 
those comments. Also, in May 2009, FTA took steps to address concerns 
about the exclusion of some project justification criteria from the 
evaluation process. In a Notice of Availability for New Starts and 
Small Starts Policies and Procedures and Requests for Comments in the 
Federal Register, FTA proposed changing the weights assigned for the 
project justification criteria for New Starts projects. See 74 Fed. 
Reg. 23776 (May 20, 2009). According to FTA, these changes reflect 
statutory direction that project justification criteria should be given 
"comparable, but not necessarily equal, numerical weight" in 
calculating the overall project rating. See SAFETEA-LU Technical 
Corrections Act of 2008, Pub. L. No. 110-244, § 201(d), 122 Stat. 1610. 
FTA is currently soliciting public comments on these proposed changes. 

[47] GAO, Public Transportation: Improvements Are Needed to More Fully 
Assess Predicted Impacts of New Starts Projects, [hyperlink, 
http://www.gao.gov/products/GAO-08-844] (Washington, D.C.: July 25, 
2008). 

[48] DOT program funding includes funding for transit activities 
administered by FTA. 

[49] The development costs which are included in determining the amount 
of eligible tax credits include "hard" costs, such as construction 
costs, and most "soft" costs, such as architectural and engineering 
costs, soil tests, and utility connection fees. 

[50] See 49 C.F.R. § 18.31. 

[51] 49 U.S.C. § 5334(h). 

[52] Reconnecting America's Center for Transit-Oriented Development, 
Realizing the Potential: Expanding Housing Opportunities Near Transit, 
April 2007. 

[53] 153 Cong. Rec. H15741, H16497 and H16562 (Dec. 17, 2007). 

[54] FTA has taken the lead in developing a best practices guidebook on 
mixed-income housing and transit-oriented development and FTA has 
partnered with Center for Transit-Oriented Development to develop the 
guidebook, FTA providing the $60,000 and the Center matching this 
funding amount. 

[55] On June 16, 2009, it was announced that EPA joined DOT and HUD in 
the Partnership for Sustainable Communities. 

[56] Additional livability principles include valuing communities and 
neighborhoods, coordinating federal policies and leveraging federal 
investments, and enhancing economic competitiveness. 

[57] Both competitive task orders were issued on June 1, 2009, and must 
be awarded by September 30, 2009. 

[58] The first policy report is due to be delivered 3 months after the 
contract is awarded, the second policy report is due to be delivered 6 
months after the contract is awarded, and the third policy report is 
due to be delivered 9 months after the contract is awarded. 

[59] GAO, Results-Oriented Cultures: Implementation Steps to Assist 
Mergers and Organizational Transformations, [hyperlink, 
http://www.gao.gov/products/GAO-03-669] (Washington, D.C.: July 2, 
2003); Intercity Passenger Rail: Issues Associated with the Recent 
Settlement between Amtrak and the Consortium of Bombardier and Alstom, 
[hyperlink, http://www.gao.gov/products/GAO-05-152] (Washington, D.C.: 
Dec. 1, 2004); United States Coast Guard: Improvements Needed in 
Management and Oversight of Rescue System Acquisition, [hyperlink, 
http://www.gao.gov/products/GAO-06-623] (Washington, D.C.: May 31, 
2006); Telecommunications: Full Adoption of Sound Transition Planning 
Practices by GSA and Selected Agencies Could Improve Planning Efforts, 
[hyperlink, http://www.gao.gov/products/GAO-06-476] (Washington, D.C.: 
June 6, 2006); 2010 Census: Costs and Risks Must be Closely Monitored 
and Evaluated with Mitigation Plans in Place, [hyperlink, 
http://www.gao.gov/products/GAO-06-822T] (Washington, D.C.: June 6, 
2006); FAA Airspace Redesign: An Analysis of the New York/New 
Jersey/Philadelphia Project, [hyperlink, 
http://www.gao.gov/products/GAO-08-786] (Washington, D.C.: July 31, 
2008). 

[60] 71 Fed. Reg. 71231 (Dec. 8, 2006). 

[61] On June 11, 2009, FTA Regional Administrators were briefed on the 
HUD-FTA action plan and notified that the HUD-FTA action plan was 
posted on FTA's Web site. 

[62] GAO, Urban Partnership Agreements: Congestion Relief Initiative 
Holds Promise; Some Improvements Needed in Selection Process, 
[hyperlink, http://www.gao.gov/products/GAO-09-154] (Washington D.C.: 
Mar. 25, 2009) and Privacy and Security: Food and Drug Administration 
Faces Challenges in Establishing Protections for Its Postmarket Risk 
Analysis System, [hyperlink, http://www.gao.gov/products/GAO-09-355] 
(Washington, D.C.: June 1, 2009). 

[63] For the purpose of this report we use the term "collaboration" 
broadly to include interagency activities that others have variously 
defined as "cooperation," "coordination," "integration," or 
"networking." We have done so since there are no commonly accepted 
definitions for these terms and we are unable to make definitive 
distinctions between these different types of interagency activities. 

[64] GAO, Managing for Results: Barriers to Interagency Coordination, 
[hyperlink, http://www.gao.gov/products/GAO/GGD-00-106] (Washington, 
D.C.: Mar. 29, 2000). 

[65] See GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[66] Even though FTA is one of the four DOT surface transportation 
operating administrations, we have decided to separate DOT and FTA in 
our discussions of agency collaboration since FTA and HUD have 
initiated collaboration efforts individually prior to the Partnership 
for Sustainable Communities. 

[67] GAO, Rural Economic Development: Collaboration between SBA and 
USDA Could Be Improved, [hyperlink, 
http://www.gao.gov/products/GAO-08-1123] (Washington, D.C.: Sept. 18, 
2009). 

[68] GAO, Results-Oriented Government: GPRA Has Established a Solid 
Foundation for Achieving Greater Results, [hyperlink, 
http://www.gao.gov/products/GAO-04-38] (Washington, D.C.: Mar. 10, 
2004). 

[End of section] 

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