Transit funding: Implications of federal aid strategies

Title: Transit funding: Implications of federal aid strategies
Format: Journal Article
Publication Date: March 1981
Published In: Transportation
Description: Federal funding strategies greatly affect investment in urban transportation facilities in the United States. This analysis concentrates on the implications of varying federal aid matching requirements, structuring aid programs as categorical or block grants, and allo cating funds on a discretionary basis or according to formula. Toward this end the effects of recent federal transit aid arrangements are assessed. Increased federal matching share broadens program participation, especially among smaller cities. However, when offered a choice, communities' preference for more generous federal aid shares is tempered by their election of discretionary grants (e.g., Urban Mass Transportation Administration - UMTA - Section 3) instead of drawing on formula funds (e.g., UMTA Section 5 or highway fund transfers). Formula funds are easier to administer, distributed quite evenly in the UMTA case, and generally more suitable than discretionary funds except where expenditures are large relative to budgets. Categorical aid programs shift local priorities, and thus should be used with caution Overall, results suggest that one must begin with established transportation objectives against which to evaluate the effectiveness of funding arrangements. In particular, it is critical to make clear the rationale for federal involvement in funding specific programs. Four such federal funding intents are distinguished: compelling national interest, regional development, stimulation of recipient investment in the given program, or financial relief for the aid recipient. Conclusions are drawn as to the desirability of various funding policies according to such program intent. © 1981 Elsevier Scientific Publishing Company.
Ivan Allen College Contributors:
Citation: Transportation. 10. Issue 1. 3 - 22. ISSN 0049-4488. DOI 10.1007/BF00165614.
Related Departments:
  • School of Public Policy