Statement of
Mary E. Peters,
Administrator, Federal Highway Administration
Donna McLean,
Assistant Secretary for Budget and Programs and
United States
Department Of Transportation
Before the Committee On Environment And Public Works
United States Senate
Hearing on the Department of Transportation
Fiscal Year 2003 Budget and the Highway Trust Fund
February 11, 2002
Mr. Chairman and Members of the Subcommittee, thank
you for the opportunity to testify today in support of the President=s Fiscal Year (FY) 2003 Budget proposal for the
Department of Transportation and to discuss the status of the Highway Trust
Fund. We would also like to thank you
for your leadership in scheduling a series of hearings in preparation for the
reauthorization of the surface transportation program. We are looking forward to working with this
subcommittee and with Congress to achieve the goals outlined in the FY 2003
budget request and to shape reauthorization proposals. Working together, we can meet the
transportation challenges facing our Nation and provide the American people
with a transportation system that is safe, efficient, and accessible, while
remaining respectful stewards of the environment.
Overview
As a whole, the strong but flexible multi-modal system
developed under the Intermodal Surface Transportation Efficiency Act of 1991
(ISTEA) and the Transportation Equity Act for the 21st Century
(TEA-21) is working well in supporting our Nation=s economic growth and improving the quality of life for all our
citizens. Our Nation=s highways and intermodal connectors are the critical
link in the national intermodal transportation system. The challenge is to maintain our
high-quality network while achieving our goals to increase safety, ensure
national security, improve mobility, and promote environmentally responsible
and efficient project delivery. The
$24.1 billion funding level, proposed by the President for the Federal Highway
Administration (FHWA) for FY 2003, provides funding essential to meet this
challenge. This includes a Federal-aid
Highway obligation limitation of $23.2 billion. The FY 2003 request reflects the funding levels enacted in
TEA-21, as adjusted to reflect the latest Highway Trust Fund revenue figures,
and honors the highway category guarantees in that Act.
The key to ensuring that highway-related receipts are
spent is that the highway funding level is adjusted each year to reflect the
latest information on Highway Trust Fund (HTF) receipts. At the time of the enactment of TEA-21,
highway program funding levels were set based on estimates of HTF
receipts. Each year, the level is adjusted
using a formula specified in TEA-21.
This adjustment ensures that highway spending remains aligned with HTF
receipts.
In fiscal years 2000, 2001 and 2002, our Nation reaped
the benefits of record-level funding for surface transportation as authorized
in TEA-21. The guaranteed funding
level, tied to HTF receipts, has provided the States with much needed resources
to support the Nation=s highway infrastructure, as Congress intended. In FY 2003, however, declining HTF receipts
will, for the first time, trigger a downward adjustment, in the amount of
$4.369 billion, in the highway program level, in order to keep highway spending
aligned with the status of the Highway Trust Fund. Even with this negative calculation, over the life of TEA-21,
these adjustments will provide a net gain of almost $4.7 billion in highway
spending.
The
calculation of the adjustment is not a policy call--it is a calculation based
in law and reflected in the budget. As
we discuss the reauthorization of the surface transportation program, we need
to look for ways to smooth out current positive and negative swings that result
from this adjustment. What we should
not do is abandon this adjustment concept.
Linking highway spending to receipts is a fundamental principle of TEA-21.
The budget proposes to fund most Federal-aid highway
programs from within the obligation limitation, including our major programs:
the Surface Transportation Program, the National Highway System, Interstate
Maintenance, the Highway Bridge Replacement and Rehabilitation Program, and the
Congestion Mitigation and Air Quality Improvement Program. Other TEA-21 programs include the National
Corridor Planning and Border Infrastructure Improvement programs and the
Transportation and Community and System Preservation Pilot Program. The Emergency Relief program and a portion
of the Minimum Guarantee program will continue to be exempt from the
limitation. The estimated obligation
level for exempt programs in FY 2003 is $893 million.
In the face of declining revenues into the Highway
Trust Fund, we continue to strongly support creative financing solutions.
Consequently, the 2003 budget includes $99 million to leverage our Federal
investment in transportation infrastructure under the Transportation
Infrastructure Finance and Innovation Act Program (TIFIA). This investment will translate into over $6
billion in nationally significant surface transportation projects.
As the events of September 11 so graphically
demonstrated, a safe and secure surface transportation system is vital to all
Americans. We must keep our
infrastructure secure and we must strengthen our commitment to reducing highway
injuries and fatalities, even as we squeeze additional capacity from the
system. To meet this challenge, the FY 2003 Budget for FHWA emphasizes four
priority areas: safety, mobility, environmental stewardship and streamlining,
and oversight.
Safety continues to be the Department of
Transportation=s most important priority. While the number of highway
fatalities in recent years has been held relatively flat, despite significantly
rising numbers of vehicles on our roads, more than a quarter of a million
people have been killed on America=s
roadways in the past six years, 41,000 deaths each year. There are also more than 3 million
police-reported injuries annually.
Highway safety improvements are critical to improving these
numbers. Success will depend on a
balanced approach that addresses the behavioral, vehicular, and roadway
infrastructure and operations safety problems. We can, we must, and we will
strive to do better.
FHWA works closely with States and other partners to
improve our ability to analyze roadway safety challenges and to direct
investments to specific projects and programs, which will deliver the most
value in terms of lives saved and injuries minimized. For example, construction programs continue to contribute to
safety by correcting unsafe roadway design and removing roadway hazards. States
mayCand doCuse their
Surface Transportation (STP), Interstate Maintenance, and National Highway
System (NHS) funds for safety improvements.
Safety can be built into every interchange upgrade, intersection
redesign and new facility through safety conscious planning and design. Signing
and pavement improvements can enhance the safety of existing and new facilities
for all users of the highway system.
Within the STP, 10 percent of funds are reserved under
TEA-21 for highway-rail crossing improvements and hazard elimination. The Hazard Elimination program supports
efforts to resolve safety problems at hazardous highway locations. Since the enactment of TEA-21, States have
obligated $489.3 million in Hazard Elimination funds, and another $707.4
million in optional safety funds have been obligated primarily for Hazard
Elimination purposes. These Hazard
Elimination expenditures are estimated to have saved 7,200 lives since
1998. The Highway-Rail Grade Crossing
Safety program is designed to reduce crashes at public grade crossings, and
$499 million in Highway-Rail Grade Crossing funds have been obligated. The
grade crossing safety program is estimated to have saved 2,000 lives since
1998.
To meet its highway safety goal, FHWA will focus its
safety programs on reducing the most frequent types of fatal crashes through
technical assistance, research, training, data analysis, and public information.
From the $359.8 million requested for research and
technology programs for FY 2003 budget, significant resources will be invested
in improving safety. Part of the
research funding will support innovations, such as brighter traffic signal lights
which are more visible to drivers, to improve safety at or near
intersections. Research funding also
supports speed management techniques, which are designed to reduce the 30
percent of fatal crashes in which speed is a factor. Rumble strips help prevent run-off-the-road crashes, which
account for 38 percent of all fatal crashes.
FHWA provides technical assistance to States like Maryland, whose 1999
data show a $182 safety benefit for
every dollar spent on rumble strip installation.
National deployment of wireless enhanced 9-1-1 (E-9-1-1) will be accelerated this year. E-9-1-1 is an emergency cellular telephone service that automatically routes calls to the closest public safety answering point and informs the dispatcher of the caller’s location. It will save lives. About 25 percent of 9-1-1 calls come from wireless phones. Without automatic location, when callers are unable to describe their location, response times dramatically increase. Response time is a critical factor in determining the survivability of a crash. Also, more timely and accurate information will aid police, fire, and other emergency responders in protecting victims and property and in reducing traffic congestion surrounding the scene.
Recent events have focused attention on the need to
ensure the security of our Nation=s
transportation system and ITS technologies offer many opportunities to
significantly improve transportation security.
The ITS program is developing and deploying technologies to help States
and localities improve traffic flow and safety on streets and highways and
address the need for emergency notification and response. This budget proposes to focus the FY 2003
ITS Deployment Program resources of $93 million on ITS technologies that
enhance the security of our surface transportation systems.
A major emphasis in ITS will continue to be in the
area of intermodal freight. The
Department is conducting several ITS operational tests that are designed to
improve the efficiency and security of the intermodal movement of freight. The Chicago O=Hare cargo project, which is an operational test, uses a “smart card”
and biometric identifiers to identify the shipment, vehicle, and driver during
transportation from the shipper to and through the air cargo terminal. Another project, Cargo-Mate, has particular
applicability to port and container security, in addition to enhancing
efficiency of freight movement. The
system is designed to perform real-time processing of asset and cargo
transactions, provide for the surveillance of cargo movement to and from ports,
and provide an integrated incident and emergency response capability.
To improve safety of motor carriers operating on our
highways, as well as national security, a total of $47 million is requested for
construction of motor carrier safety inspection facilities on the Southern
Border within the Coordinated Border Infrastructure Program. This builds on funding provided in FY 2002
and supports infrastructure improvements necessary to accommodate permanent
facilities.
Congestion is one of the most obvious results of the
mismatch between the growing demands for transportation and the capacity of our
systems, particularly in metropolitan areas.
Congestion is a complex problem involving many factors. This budget works to address the causes of
frustrating delays that face travelers and shippers and impact the Nation=s economic efficiency. Funding will support the identification and implementation of a
mix of locally preferred investments, including selective additions of new
capacity, to improve traffic flow and system reliability. Our progress toward
our goal of supporting mobility is tracked by measures such as improvement in
pavement and bridge condition and by reduction in the growth of traffic
congestion.
States may direct 2003 Federal-aid highway funds,
according to their priority needs and goals, to a variety of system improvement
and congestion relief purposes. In
recent years, approximately 50 percent of Federal funds were obligated for
system upgrading purposes, including reconstruction, widening, restoration and
rehabilitation, and resurfacing.
Consequently, overall highway system conditions, as measured by pavement
condition, ride quality, alignment adequacy, and bridge ratings, have steadily
improved. In 2001, 91 percent of travel on the NHS occurred on pavements
rated acceptable or better. In FY 2003, the Department’s goal is to increase this to 92
percent.
For FY 2002 and beyond, the FHWA has modified its
bridge performance measures in order to take into account the actual area and
average daily traffic on the bridge.
This measure more accurately reflects progress toward meeting our
mobility goal. The previous measure of reducing the number of deficient bridges
considered all bridges as equal, therefore large bridges with higher average
daily traffic were considered the same as smaller bridges with lower average
daily traffic. Since the enactment of
TEA-21, the condition of NHS and non-NHS bridges has improved significantly. In 1998, the percentage of the Nation’s
total bridge deck area that was on deficient NHS bridges was 32.6 percent and
32.5 percent on non-NHS bridges. In
2001, the percentage of deck area on deficient NHS bridges was 30.6 percent and
32.3 percent on non-NHS bridges. Our goal for FY 2003 is to improve the
condition of bridges so that the percentage of deck area on deficient bridges
is reduced to 27.5 percent for the NHS and 29.8 percent for the non-NHS.
The development and deployment of longer lasting materials
will mean that facilities will need repair or improvement less often, thereby
reducing congestion and safety problems associated with work zones. Research and Technology program funds
support multi-year initiatives in pavements, structures, and asset management.
Along with improved condition and strategic expansion of infrastructure, we must address congestion through improved operation of the highway system. In the last year we developed and tested a system reliability index in 10 cities that we call the “buffer index,” the amount of time you have to add to your trip because of system unreliability. It will help cities gauge how well they are doing in responding to incidents, managing their work zones, and responding to weather. The measure will be applied in 22 cities this year.
In
the area of congestion mitigation, we have a number of other initiatives
underway that will continue in 2003, including three that have great potential
for long term impact:
Other strategies to improve operations include the
deployment of ITS to provide more information to drivers faster, enabling them
to take the most efficient route of travel.
Significant progress has been made in ITS deployment since the enactment
of TEA-21. We have seen a 37 percent
increase in the number of freeway miles with real-time traffic data collection
technologies, a 55 percent increase in the coverage of freeways by closed
circuit television, a 35 percent increase in the number of buses equipped with
automatic vehicle location systems, and an 83 percent increase in traveler
information dissemination on our freeways.
However, only 22 percent of the freeways in major metropolitan areas are
instrumented for real time monitoring.
Therefore, ITS deployment must continue to be a high priority for the
Department. The
search for new technological and innovative solutions to our mobility
challenges will be supported by the 2003 budget request for $359.8 million for
research and technology.
We are committed, along with our partners at the State
and local levels, to maintain, operate, and improve transportation systems to
reduce congestion and improve mobility, thus allowing our Nation to compete
globally and Americans to enjoy a higher standard of living.
Environmental Stewardship and Streamlining
Implementation
of environmentally responsible transportation improvements, delivered on time
and within budget, is an important component of the Department=s vision for all its programs. TEA-21 gave States and
communities additional tools and opportunities to enhance the environment and
quality of life for their residents, while directing us to streamline the
environmental review process. Within the Federal-aid highway program, NHS and
STP funds support programs that also protect the environment. There is also a mandatory 10 percent
set-aside from each State=s STP apportionment for Transportation Enhancement
projects that support historic preservation, bicycle/pedestrian travel, scenic
easements, and other enhancements. The
CMAQ program supports projects to reduce emissions, that often reduce traffic
congestion. To minimize the impact of
transportation on air quality, FHWA will continue to work with the
Environmental Protection Agency and other partners to continue to reduce on-road
mobile source emissions.
Continued progress in streamlining the delivery of
transportation improvements will also improve safety and ease congestion, but
must be balanced against the need to protect communities and the environment.
Successful environmental streamlining requires fostering good working
relationships across a number of organizational lines. These relationships allow for the
development and establishment of reasonable and realistic schedules for advancing
major projects. It is important for
the Department to facilitate agreement by Federal agencies on time frames for
conducting reviews and granting approvals.
Working together in partnerships, combining a full range of Federal,
State, and local officials and interest groups, will lead to reasonable ways to
meet the Nation=s transportation needs, while being good stewards of
the environment.
The Department=s
streamlining approach has resulted in:
!
Reinvention of the
environmental review process, through interagency training, development of
national programmatic agreements, and guidance that encourages flexible
mitigation practices.
!
Development of a system
for dispute resolution that includes draft national procedures, guidance for
managing conflict during the project development process, and assistance by
qualified dispute resolution specialists to States and project sponsors.
!
Research conducted to
evaluate project time frames, identify reasons for project delays, and assess
the effectiveness of implementation efforts.
!
Assistance, support, and
encouragement to develop numerous best practices and pilot projects to catalyze
change and lead to even better streamlining outcomes.
Since the enactment of TEA-21 in 1998, progress has been
made in streamlining the planning and approval process for projects throughout
the country: 33 States have interagency
agreements for funding additional personnel necessary for faster, concurrent
reviews; 23 States have adopted a merged process for wetland permits with the
Army Corps of Engineers; 15 States have adopted context sensitive design
approaches; and 31 States have some level of delegated authority for historic
resources. As a result of these
actions, the mean time to process environmental documents for major highway
projects has been cut by almost eight months, the median time has been cut by
one year, and the Department is well positioned for significant future
progress.
We have begun the job, but more can be done. Only a couple of States, most notably New
Hampshire, have attempted to define time frames for concurrent reviews. New Hampshire’s model for setting project
time frames for I-93, using a partnering approach, has been publicized as an
effective streamlining tool on the FHWA website and at a national streamlining
workshop.
FHWA continues to work with other agencies to advance the Environmental Streamlining National Memorandum of Understanding (MOU). Efforts to cooperatively establish realistic project development time frames among the full range of transportation and environmental agencies will be advanced by this budget. For example, in 2003 we propose to fund $6 million from the FHWA administrative takedown for FHWA support of Federal and State initiatives to identify new, more efficient business processes that will result in more timely project delivery. Working cooperatively to adhere to those time frames is resource intensive, but it is critical to our success. With the additional proposed funding, we will be able to intensify efforts currently underway within DOT that focus on solidifying the interagency partnerships, such as pilot efforts and process reinvention.
Oversight
We must continue to improve Federal oversight and
accountability for the expenditure of public funds. Increased emphasis on FHWA=s oversight responsibilities must accompany the
significant increases that have occurred in the Federal-aid Highway program in
recent years if our Nation is to make the Abest
buys@ in safety and congestion relief. FHWA oversight policies were updated and
clarified in FY 2001 and their implementation will continue into the requested
budget year. Even as legislation has
directed FHWA to delegate many project-level authorities to the States, the
responsibility for program oversight to ensure the effective delivery of all
programs remains with FHWA. Additional
resources deployed in this area will enable FHWA to work with the States to
improve its management of the Federal-aid highway program, including cost
containment, while allowing States maximum delegated authority and flexibility,
as appropriate. FHWA will continue to
advance asset management and system preservation initiatives to foster more
systematic and strategic thinking and investment choices by the State and local
governments. Timely investments in the
size and makeup of the Federal workforce itself are also crucial with the aging
of both the Interstate Highway System and the workforces of our partner
agencies in States and localities. We
are focusing new attention on workforce development issues and will keep the
subcommittee advised of our efforts. As
larger and more complex projects are contemplated, a balance must be achieved
between addressing the needs of major projects and the vast majority of the
program vested in smaller projects.
In 1998-1999, FHWA undertook a major restructuring in
order to move program decision authorities closer to our primary customers, the
States, and to focus high-level technical expertise in our Resource Centers.
Through this redeployment of existing resources we have also been able to fulfill
FHWA=s commitment to add an additional position in
respective Division Offices for the oversight of each major project.
The FY 2003 budget requests a funding level of $318
million for the necessary salaries and benefits for our employees and for
ongoing administrative expenses in support of our Federal-aid program. The budget request reflects modest
adjustments for mandatory salary and benefit increases and other adjustments
for current service levels.
Status of the Highway Trust Fund
The cash balance in the Highway Trust Fund (HTF) at
the end of fiscal year 2001 was $27.740 billion, of which $20.372 billion was
located in the Highway Account and $7.369 billion in the Mass Transit
Account. Based on the latest projections
of income to the HTF reported by the Department of the Treasury, the Department
of Transportation estimates that the Highway Account of the HTF has sufficient
revenues to support the levels of authorizations throughout the life of TEA-21.
Balances in the Highway Account of the HTF should not
be considered as surplus funds. Current
commitments of HTF revenues for prior year obligations, as well as unobligated
balances of prior year apportionments, exceed $67 billion. However, as reimbursing cash is made
available from the HTF, revenues from excise taxes are coming into the
HTF. Any consideration of HTF balances
must take into account not only current levels of revenue, but also commitments
made against that revenue, and projected levels of future income.
Conclusion
The funding requested in 2003 will help improve
transportation safety; enhance national security; maintain and expand our
transportation infrastructure, and increase its capacity; reduce environmental
degradation; and improve the quality of life for all our citizens. We look forward to working with Congress to
enact the President’s FY 2003 budget in order to provide a viable
transportation system to support a strong America.
Once again, thank you for this opportunity to testify
today. We will be pleased to address any questions you may have.