800 17th Street, NW, Suite 1100 Washington, DC 20006 T 202.955.3000 | F 202.955.5564 FEDERAL UPDATE July 2013 House Appropriations Update: The House Appropriations Transportation, Housing and Urban Develop subcommittee marked up the bill on June 19. The full House Appropriations Committee approved the bill on June 27. The bill provides $44.1 billion in discretionary spending – a reduction of $7.7 billion below the FY 2013 enacted level and $13.9 billion below the President’s budget request. The measure fully funds the MAP-21 surface transportation law, avoids Federal Aviation Administration (FAA) furloughs, and provides money for contract air traffic control towers. However, it also includes a provision that would eliminate funding for California's high-speed rail project, and it effectively ends the TIGER discretionary grant program. The bill funds Federal Transit Administration (FTA) New Starts at $1.817 billion, 2.1 percent below the FY 2013 funding level and 8.4 percent decrease below the president's budget request. The bill does not include funding for the president's $50 billion infrastructure stimulus funding proposal. House Majority Leader Eric Cantor has indicated that he hopes to bring the measure to floor during the week of July 29. However, passage of the legislation – which has already proven controversial due to its steep cuts – remains uncertain as Democrats are strongly opposed. Additionally, with the August recess fast approaching and consideration of recent appropriations bills taking longer than expected, it is possible consideration of the bill could be delayed. Senate Appropriations Update: The full Senate began consideration of its version of the FY 2014 Transportation, Housing, and Urban Development (THUD) Appropriations bill during the week of July 22. Overall, the Senate THUD bill totals $54 billion, providing $10 billion more than its House counterpart. Specifically, it includes $550 million for TIGER projects, with a requirement that the Department of Transportation must allocate no less than 20 percent of the funding ($110 million) for projects in rural communities. The bill also includes $40.3 billion for federal-aid highways, $636 million above the FY 2013 enacted level, and $1.943 billion for FTA's New Starts program. The measure includes only $100 million for high-speed rail, a significantly lower amount than the $3.66 billion requested in the president's budget but much more than the House version, which includes no funding. The bill provides $500 million for "Bridges in Critical Corridors" (BRICC). This funding would support bridge projects eligible under the Surface Transportation Program, which is authorized by MAP-21. The funding will be distributed through a competitive process, and the bill requires the Secretary of Transportation to ensure an equitable geographic distribution of funds and an appropriate balance in addressing the needs of urban and rural areas. No similar investments were provided for in FY 2013. Senate Majority Leader Harry Reid (D-NV) hopes to complete consideration of the legislation before the August recess. However, several amendments to the legislation have been offered and debate will continue into the week of July 29. Notably, an amendment by Senator Sherrod Brown (D-OH) would allow Demand Response Transit (DRT) systems, which offer “pickup” services, greater flexibility if they use federal transit dollars. DRT systems do not operate fixed route service and provide public transit in small to medium sized vehicles for individuals living in either rural or low population areas where there is low passenger demand. Most users of DRT systems are senior citizens and people with disabilities. Federal funds are typically prohibited for transit operating expenses in urban areas of 200,000 or more residents. Under Brown’s amendment, however, small DRT systems would be given flexibility to use funds for operating assistance. Additionally, Senator Mark Udall (D-CO) has offered one amendment that would require FRA to reexamine its regulations on trains using horns at road crossings. Holland & Knight continues to monitor the floor debate surrounding the bill and will keep SamTrans apprised of any developments of interest. Foxx Confirmed as Transportation Secretary: On June 27, the Senate confirmed Charlotte, North Carolina Mayor Anthony Foxx to serve as the next Secretary of Transportation by a vote of 100 to 0. Foxx was unanimously approved by the Senate Commerce, Science, and Transportation Committee earlier in the month. He replaces outgoing Secretary Ray LaHood who announced his intention to step down earlier this year but agreed to remain in his post until a successor was confirmed. Elected as mayor in 2009, Foxx is widely considered a rising star in the Democratic Party and has been praised for his role in luring the 2012 Democratic National Convention to Charlotte. His tenure as the city's top official has also seen many transportation successes, including the expansion of Charlotte's streetcar system to UNC-Charlotte, the formation of the Charlotte Regional Intermodal Facility that transfers cargo between trucks and trains, and the construction of a new runway at Charlotte's Douglas International Airport. Senate Commerce Holds Hearing on Rail Safety: On June 19, the Senate Commerce, Science, and Transportation Committee held a hearing entitled "Staying on Track: Next Steps in Improving Passenger Freight Rail Safety." The meeting, chaired by Senator Richard Blumenthal (D-CT), included a lengthy discussion of recent rail accidents in Connecticut and Missouri as well as an in-depth dialogue about the status of rail safety efforts across the country. Particular attention was paid to Positive Train Control (PTC) requirements. The hearing featured two panels. Witnesses on the first panel were: The Honorable Joseph Szabo, Administrator, Federal Railroad Administration (FRA); The Honorable Deborah 2 Hersman, Chairman, National Transportation Safety Board; and Ms. Susan Fleming, Director, Physical Infrastructure Issues, U.S. Government Accountability Office (GAO). The second panel was made up of Mr. Ed Hamberger, President and CEO, Association of American Railroads; Ms. Kathryn Waters, Executive Vice President for Member Services, American Public Transportation Association (APTA); Mr. James Stem, National Legislative Director, Transportation Division, International Association of Sheet Metal Air, Rail, and Transportation (SMART) Workers; Mr. James Redeker, Commissioner, Connecticut Department of Transportation; and Ms. Michelle Teel, Multimodal Director, Missouri Department of Transportation. Mr. Szabo detailed recent accomplishments of the FRA and discussed the current challenges faced by his organization. He also discussed implementation of the Railway Safety Improvement Act (RSIA) stating that FRA has completed 59 percent of the rules mandates by RSIA and 69 percent of the studies. He outlined the efforts FRA has undertaken to comply with "unprecedented mandates" found in RSIA. He then spoke about the main causes of rail accidents. He also offered his thoughts of RSIA and PRIIA reauthorization. On that note, he said that the FRA's main priorities are: (i) enhancing world class rail safety, (ii) modernizing rail infrastructure, (iii) meeting the growing market demand, (iv) promoting innovation, and (v) ensuring transparency and accountability. To meet these goals, he stressed, there is a strong need for predictable funding. Finally, Mr. Szabo addressed the options FRA is exploring to enhance safety (PTC, hours of service, grade crossing analyses, harmonization of operating rules, etc.). Ms. Hersman spoke generally about rail safety and stated that, despite its increased role in the American economy, we must not become complacent with rail. She then detailed the NTSB's response to recent accidents in Connecticut, Maryland, and Missouri. She also outlined the NTSB's "Most Wanted List" - a catalogue of top safety priorities for the agency. Among the items on the list are PTC, less distraction, improved infrastructure, and in-cab recording devices, among others. Ms. Fleming discussed the GAO's ongoing reviews of FRA's rail safety oversight and the implementation of PTC. She detailed several challenges facing FRA, including lack of a final rule for risk reduction plans, lack of succession planning for its aging inspector workforce, effects of weather on railroad operations, and new technologies such as PTC. She closed with an assessment of PTC implementation, stating that most railroads will fail to meet the 2015 deadline due to the challenges and complexity posed by the requirement. Mr. Hamberger touted the industry's strong safety record, noting that 2012 was the safest year in rail history. He stressed the need for a financially stable rail system that can invest in safety measures as needed. He spoke at length about PTC, pointing out that it is an "unprecedented technological challenge" that includes a "daunting array of tasks that railroads must perform." He suggested that the implementation deadline for PTC should be extended by at least three years, to December 2018. Ms. Waters stressed APTA's commitment to safety mentioning that it has supported the concept of PTC since the beginning. She stated that APTA is working with its members to meet the 3 implementation requirements, but APTA urges the committee to focus on the best way to install PTC systems on an complicated network of rails in a way that maximizes all of an operator's safety concerns while still moving