Trump's Move Towards Private Funding In Public Transit

New procedures announced by Federal Transit Administration are designed to further the Trump Administration's goals to empower the private sector to rebuild the nation's infrastructure.

The U.S. Department of Transportation’s (U.S. DOT) Federal Transit Administration (FTA) today announced a proposal to facilitate public-private partnerships in public transportation, removing regulatory roadblocks for private investments in public transit.

The FTA is proposing new procedures, Private Investment Project Procedures (PIPP), to encourage increased project management flexibility, more innovation in project funding, improved efficiency, timely project implementation, and new project revenue streams. These new policies will seek to continue a now decades-long Federal agenda that seeks to encourage increased use of public-private partnerships and private investment in public transportation capital projects. As detailed in a Notice of Proposed Rulemaking (NPRM), recipients of Federal funding for public transportation projects would be allowed to identify specific FTA regulations, practices, procedures or guidance documents that may be an impediment to the use of a public-private partnership (P3) or private investment in that project.

“One of the Trump Administration’s priorities is to allow private sector resources and expertise to help rebuild America’s infrastructure,” said U.S. Department of Transportation Secretary Elaine L. Chao. “This proposal will help us better understand the ways that unnecessary procedures may get in the way of building the best projects possible at the lowest cost to the public.”

Denver RTD’s Eagle Project is the first transit DBFOM (design, build, finance, operate, and maintain) Public-Private Partnership in the United States. RTD, which participated in a Public-Private Partnership Pilot Program established in the Safe, Accountable, Flexible, Efficient, Transportation Act (SAFETEA-LU) legislation, selected Denver Transit Partners to deliver the commuter rail project, which began service in 2016.

Under the proposed PIPP system, recipients of Federal assistance would be able to apply to FTA to request modification or waiver of specific FTA requirements if the recipient demonstrates that those requirements discourage the use of public-private partnerships. The FTA Administrator would then have discretion to grant a modification or waiver of a requirement if certain criteria are met.

However, the PIPP could not be used to waive any requirement under the National Environmental Policy Act (NEPA) or any other provision of Federal statute.

“As more public transportation project sponsors find willing and able private partners, we must ensure that federal regulations or procedures do not stifle innovation,” said FTA Executive Director Matthew Welbes. “FTA’s Private Investment Project Procedures will help us maintain procedures that are truly beneficial while allowing for discretion to waive those that simply impede good projects.”