sequent fiscal years to finance the programs and activities, including administrative costs, authorized by that act. Appropriations to liquidate the contract obligations incurred would be authorized for fiscal year 1971 in the amount of $80 million, which limitation would be progressively increased in each of the following fiscal years to $310 million, $710 million, and $1.26 billion, respectively, until it reached $1.86 billion at the end of fiscal year 1974. Thereafter the limit would be the maximum $3.1 billion. These limitations would not apply to appropriations authorized under the Urban Mass Transportation Act of 1964 for prior fiscal years. The Secretary would be required to submit authorization requests to the Congress not later than Frebuary 1, 1972, for fiscal years 1976 and 1977, and subsequent requests every 2 years not later than February 1, for the following 2 fiscal year periods, with a final authorization request not later than February 1, 1978, for fiscal year 1982. These authorization requests must be designed to meet the Federal commitment of not less than $10 billion in additional Federal funds over a 12-year period for urban mass transportation programs, as specified in S. 3154. Concurrently with the additional authorization requests, recommendations must be submitted for any necessary adjustments in the schedule of appropriations for liquidation of contract obligations. The long-term program of Federal financial assistance, combined with contract authority which the bill would authorize, are necessary to provide assurance of continuing Federal assistance at a level adequate for the present and anticipated urban mass transportation needs of States and local public bodies, over a time span sufficient to accomplish the planning, decisionmaking, and financing arrangements (including referendums) necessary to the orderly development of urban mass transportation systems. PUBLIC HEARINGS Applicants for capital grants or loans would be required to hold, or provide the opportunity for, public hearings on projects which would substantially affect a community or its mass transportation service, and to include certification thereof in the application. Where hearings have been held, a copy of the transcript must accompany the certification. STATE LIMITATION The $12.5 million discretionary fund provided in the Urban Mass Transportation Act of 1964 would be changed, as to grants made on or after July 1, 1970, to a fund comprised of 15 percent of the aggregate amount of funds authorized to be obligated under the new program. It is the understanding and intent of the committee that this fund be used judiciously to bring relief to the States whose cities have already or soon will reach the 12%1⁄2-percent limitation on aggregate grants in any one State rather than to augment substantially grants available to any one State. The committee intends to keep the use of this discretionary fund under close surveillance to insure that a disproportionate amount of these funds do not go to any one State. The problem NEED FOR THE BILL According to the U.S. Bureau of the Census, approximately four out of every 10 Americans lived in urban areas as we entered the twentieth century. By 1960 that proportion had grown to seven out of 10, and by the year 2000, according to current estimates, approximately 90 percent of all Americans will be living in urban areas. Moreover, it is probable that the Nation's entire projected population growth of 150 million during the next 40 years will occur in and around our cities. This means that shortly after the turn of the century our urban population will be nearly double today's. The demand for urban services, particularly transportation, has grown with the expansion of the Nation's urban population. For example, in 1965 almost 75 million privately owned automobiles were registered in the United States, up from 25 million in 1945. If urban population projections materialize and if current rates of auto ownership continue, there will be almost 75 million additional passenger cars in use in urban areas alone by the year 2000. In the past as the demand for transportation has increased, it has been met largely by increased auto ownership and new highway construction but the urban public transportation industry has experienced declining patronage and net revenues. Since World War II, public transportation has been in a cycle of increasing costs, declining profits, decreasing quality, and decreasing traffic (although the volume of passenger traffic in the larger cities has steadied in the last several years). Since 1965, public transportation has suffered large and increasingly serious operating deficits. Statistics on the operations of the industry explain and give emphasis to its plight. Source: American Transit Association Annual "Transit Fact Book," selected years. Fares have increased threefold during this 20-year period but revenue passengers have decreased by two-thirds and as a consequence a modest net operating increase in 1945 became a deficit of $11 million in 1965 and much more serious deficit of $130 million in 1968. These figures bear out what is being said on the fate of many transit companies since 1954. Some 120 companies have disappeared as a result of bankruptcy, abandonment, or absorption into other companies; 70 of these were in cities of less than 25,000 population. Appraisals based on articles in technical journals and informed opinion in the industry suggest that 90 additional companies are in financial difficulties and in some instances close to bankruptcy. Of these, more than half are controlled by "transit chains" now generally seeking to dispose of properties in smaller cities. S. Rept. 633, 91-1 2 Some of the reasons for the decline in public transportation include: The general attractiveness to the public of the private automobile as a mode of transportation, and the increasing affluence which has allowed growing numbers of consumers to purchase automobiles; The dispersion of the urban population's homes and, to an increasing extent, its jobs into low density suburbs, where public transportation has had less of a relative advantage and, in its conventional form, is more difficult to provide than in the higher density cities; The relatively large amounts of Federal funds which have been available to support highway expenditures in urban areas ($2.2 billion in fiscal year 1970), most of it at a 90 percent Federal share, compared to the very small amounts which only recently have been made available for public transportation ($175 million in fiscal year 1970) at a two-thirds Federal share-a disproportion that has affected seriously the decisions made by planners, local government, and local voters in the choice between highway and public transit solutions to the urban transportation problem; The fact that public transportation costs must be paid by the user every time he rides a public transportation vehicle, whereas the automobile user does not "feel" all his costs directly when he uses his car; The regulatory and political pressure to keep public transit fares low, which has necessitated a decrease in quality (public transit users are willing to pay somewhat higher costs if the quality of service is improved, though fare increases are accepted most readily when service improvements are made first); Limited advances in transit technology and management techniques. Some of the adverse effects of the decline in public transit include: Growing difficulties for the great numbers of people who cannot afford private automobile transportation or who cannot use it readily (e.g., the aged, the young, and the handicapped); Increased public costs for streets and highways to handle the accompanying growth in automobile traffic and, if present trends continue, a likely doubling of that cost in the 1970's; Continuing, frustrating, and expensive congestion which does not diminish because new highway capacity is soaked up by induced demand; Adverse environmental impact of the private auto-highway system in urban areas, particularly the heavy contribution to urban air pollution of more and more private autos traveling at reduced speeds; and Inefficient use of many current urban highway and street networks, through the increasing use of these systems by low occupancy vehicles in urban areas. Capital requirements Urban transportation studies which have been made in our Nation's large urban areas during the past 5 years have generally concluded that public transit will continue to maintain a relatively constant ridership in absolute terms, but will continue to decrease relative to automobile transportation. However, even this maintenance of ridership is premised on large new capital investment in public transit. Based on studies which have been made in cities where rail systems have been decided upon or are being considered (e.g., Atlanta, Baltimore, Los Angeles, Pittsburgh, Seattle) or where major extensions are being planned to existing systems (e.g., Boston, Chicago, Cleveland, Philadelphia, New York) an estimate of capital requirements for public transit over the next 10 years has been developed. A report prepared for the Department of Housing and Urban Development in 1966 by consultant Paul H. Gerhardt developed an estimate of $10 billion as the capital requirements for current, planned and likely fixed rail and bus systems for the 1966-75 period based on discussions with planning bodies and transit companies. Since 1966, cost escalation requires the upward adjustment of these figures to a total of $11.8 billion (1969 dollars). To illustrate cost escalation the price of San Francisco's BART rail-transit system has already escalated more than 33 percent over estimates made when financing was arranged. More recent estimates prepared for the Urban Mass Transportation Administration by the Institute of Public Administration place 10-year requirements at between $28 and $34 billion, reflecting both (1) the prospect of continued inflation (note that the Interstate Highway program originally estimated to cost $34 billion is now generally thought likely to involve Federal expenditures exceeding $60 billion) and (2) a marked increase of interest among cities and other local public agencies in improving urban mass transportation facilities as the Federal assistance program begins to show results. Finally, these estimates are generally based on keeping ridership constant. Other requirements exist and even more will be needed if additional riders are to be attracted. Unless the Federal Government is prepared to foreclose any support for the capital costs of fixed-rail systems, an estimate of about $15 billion in total capital requirements for urban public transportation systems over the next decade would seem to be reasonable for policymaking purposes. The condition of the industry points clearly to its inability to meet these needs either from operating revenues or from new capital raised by the sale of stock or bonds. Experience gained from the ongoing Federal aid program supports the conclusion that the gap between "gross project costs" and "net project costs," or that portion of new capital costs that can be supported from the farebox, is small and rapidly disappearing. The problem of the poor Public support of auto-highway oriented transportation in urban areas has caused serious disadvantages to the poor. While nearly all families with incomes in excess of $10,000 have a car, less than half of those with poverty-level incomes (less than $3,000) own an automobile. Most new jobs for unskilled and semiskilled workers now being created are located in the suburbs. The core-city unemployed are, therefore, compelled to use low-quality, increasingly costly public transit to seek work and in some areas no transit is available at all. The economic and social isolation of the poor thus becomes more intensified. There is little doubt that the lack of adequate transportation has been an important factor in the growing unrest in our cities. Suburban commuters Announcing the decision to proceed with double-decking of the Verrazano-Narrows Bridge in New York Harbor many years before originally estimated traffic growth would require it, the late Henry A. Barnes, New York City Traffic Commissioner spoke with some bewilderment of what had begun to seem an ever-receding capacity goal at which congestion was to have been conquered. Most students of highway traffic now believe that no conceivable increase in capital investment in highways during the foreseeable future will cure the congestion problem. From serious congestion in the largest cities, highway congestion has spread to middle-size cities as the automobile population increases and traffic absorbs new capacity. Some technicians hold that new capacity only induces new demand. It is clear, therefore, that not only the poor but also the suburban middle-class family who is experiencing increasing frustration and delay especially in the journeys of the family head to and from his work can benefit from improved public transportation. In large cities (e.g., Boston, Philadelphia, and Chicago) and in smaller cities (e.g., Peoria, Ill.), demonstration and capital improvement programs assisted by the Federal urban transportation program, have shown that people will welcome and use improved mass transportation facilities. Perhaps the clearest proof thus far is in Cleveland where extension of the rail rapid transit line to Hopkins Airport has produced twice the traffic estimated in the course of project planning and where acquisition of additional rail cars representing a 50-percent increase in the original order has already been decided. These figures represent only airport to downtown traffic since the intermediate stations had not been opened at the time the data were collected. Smaller Cities The difficulties of transit systems in smaller cities have already been mentioned. The allegation has occasionally been made that the federally assisted program is for the exclusive benefit of large metropolitan areas. This is, of course, emphatically not the case; Federal assistance is available to all urban people regardless of the size of the city which they inhabit. The committee endorses this proposal and notes that 27 grants have been made to cities of less than 25,000 population and that a preponderance of the total number of all grants have gone to cities of less than 500,000 population. SUMMARY OF THE URBAN MASS TRANSPORTATION ACT OF 1964 (AS AMENDED) To facilitate the understanding which the proposed changes S. 3154 would make in the Urban Mass Transportation Act of 1964, a sectionby-section summary of the act is provided. Section 1. "Urban Mass Transportation Act of 1964." Section 3. Federal Financial Assistance. (a) Eligibility for assistance.-Eligible applicants: States and local public bodies and agencies thereof. Applicants must have (1) the legal, financial, and technical capacity to carry out proposed project and (2) satisfactory continuing control of use of facilities and equip ment. |