    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

             FAST ACT IMPLEMENTATION: STATE AND LOCAL PERSPECTIVES

    =======================================================================

                                    (115-10)

                                    HEARING

                                   BEFORE THE

                                SUBCOMMITTEE ON
                              HIGHWAYS AND TRANSIT

                                     OF THE

                                  COMMITTEE ON
                       TRANSPORTATION AND INFRASTRUCTURE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 APRIL 5, 2017

                                   __________

                           Printed for the use of the
                 Committee on Transportation and Infrastructure

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                 COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                      BILL SHUSTER, Pennsylvania, Chairman

    DON YOUNG, Alaska                    PETER A. DeFAZIO, Oregon
    JOHN J. DUNCAN, Jr., Tennessee,      ELEANOR HOLMES NORTON, District of
      Vice Chair                         Columbia
    FRANK A. LoBIONDO, New Jersey        JERROLD NADLER, New York
    SAM GRAVES, Missouri                 EDDIE BERNICE JOHNSON, Texas
    DUNCAN HUNTER, California            ELIJAH E. CUMMINGS, Maryland
    ERIC A. ``RICK'' CRAWFORD, Arkansas  RICK LARSEN, Washington
    LOU BARLETTA, Pennsylvania           MICHAEL E. CAPUANO, Massachusetts
    BLAKE FARENTHOLD, Texas              GRACE F. NAPOLITANO, California
    BOB GIBBS, Ohio                      DANIEL LIPINSKI, Illinois
    DANIEL WEBSTER, Florida              STEVE COHEN, Tennessee
    JEFF DENHAM, California              ALBIO SIRES, New Jersey
    THOMAS MASSIE, Kentucky              JOHN GARAMENDI, California
    MARK MEADOWS, North Carolina         HENRY C. ``HANK'' JOHNSON, Jr.,
    SCOTT PERRY, Pennsylvania            Georgia
    RODNEY DAVIS, Illinois               ANDRE CARSON, Indiana
    MARK SANFORD, South Carolina         RICHARD M. NOLAN, Minnesota
    ROB WOODALL, Georgia                 DINA TITUS, Nevada
    TODD ROKITA, Indiana                 SEAN PATRICK MALONEY, New York
    JOHN KATKO, New York                 ELIZABETH H. ESTY, Connecticut,
    BRIAN BABIN, Texas                   Vice Ranking Member
    GARRET GRAVES, Louisiana             LOIS FRANKEL, Florida
    BARBARA COMSTOCK, Virginia           CHERI BUSTOS, Illinois
    DAVID ROUZER, North Carolina         JARED HUFFMAN, California
    MIKE BOST, Illinois                  JULIA BROWNLEY, California
    RANDY K. WEBER, Sr., Texas           FREDERICA S. WILSON, Florida
    DOUG LaMALFA, California             DONALD M. PAYNE, Jr., New Jersey
    BRUCE WESTERMAN, Arkansas            ALAN S. LOWENTHAL, California
    LLOYD SMUCKER, Pennsylvania          BRENDA L. LAWRENCE, Michigan
    PAUL MITCHELL, Michigan              MARK DeSAULNIER, California
    JOHN J. FASO, New York
    A. DREW FERGUSON IV, Georgia
    BRIAN J. MAST, Florida
    JASON LEWIS, Minnesota

                                      (ii)

                      Subcommittee on Highways and Transit

                         SAM GRAVES, Missouri, Chairman

    DON YOUNG, Alaska                    ELEANOR HOLMES NORTON, District of
    JOHN J. DUNCAN, Jr., Tennessee       Columbia
    FRANK A. LoBIONDO, New Jersey        JERROLD NADLER, New York
    DUNCAN HUNTER, California            STEVE COHEN, Tennessee
    ERIC A. ``RICK'' CRAWFORD, Arkansas  ALBIO SIRES, New Jersey
    LOU BARLETTA, Pennsylvania           RICHARD M. NOLAN, Minnesota
    BLAKE FARENTHOLD, Texas              DINA TITUS, Nevada
    BOB GIBBS, Ohio                      SEAN PATRICK MALONEY, New York
    JEFF DENHAM, California              ELIZABETH H. ESTY, Connecticut
    THOMAS MASSIE, Kentucky              JARED HUFFMAN, California
    MARK MEADOWS, North Carolina         JULIA BROWNLEY, California
    SCOTT PERRY, Pennsylvania            ALAN S. LOWENTHAL, California
    RODNEY DAVIS, Illinois               BRENDA L. LAWRENCE, Michigan
    ROB WOODALL, Georgia                 MARK DeSAULNIER, California
    JOHN KATKO, New York                 EDDIE BERNICE JOHNSON, Texas
    BRIAN BABIN, Texas                   MICHAEL E. CAPUANO, Massachusetts
    GARRET GRAVES, Louisiana             GRACE F. NAPOLITANO, California
    BARBARA COMSTOCK, Virginia           DANIEL LIPINSKI, Illinois
    DAVID ROUZER, North Carolina         HENRY C. ``HANK'' JOHNSON, Jr.,
    MIKE BOST, Illinois                  Georgia
    DOUG LaMALFA, California             LOIS FRANKEL, Florida
    BRUCE WESTERMAN, Arkansas            CHERI BUSTOS, Illinois
    LLOYD SMUCKER, Pennsylvania, Vice    FREDERICA S. WILSON, Florida
    Chair                                PETER A. DeFAZIO, Oregon (Ex
    PAUL MITCHELL, Michigan              Officio)
    JOHN J. FASO, New York
    A. DREW FERGUSON IV, Georgia
    BILL SHUSTER, Pennsylvania (Ex
    Officio)

                                     (iii)

                                    CONTENTS

                                                                       Page

    Summary of Subject Matter........................................    vi

                                   TESTIMONY

    J. Michael Patterson, Executive Director, Oklahoma Department of
      Transportation, on behalf of the American Association of State
      Highway and Transportation Officials...........................     7
    Gary C. Thomas, President and Executive Director, Dallas Area
      Rapid Transit, on behalf of the American Public Transportation
      Association....................................................     7
    Hon. Kasim Reed, Mayor of Atlanta, Georgia, on behalf of the
      United States Conference of Mayors.............................     7

                   PREPARED STATEMENTS SUBMITTED BY WITNESSES

    J. Michael Patterson.............................................    35
    Gary C. Thomas...................................................    47
    Hon. Kasim Reed..................................................    55

                           SUBMISSIONS FOR THE RECORD

    Letter of April 10, 2017, from Mickey Peercy, Director, Self-
      Governance, Choctaw Nation of Oklahoma, to Hon. Sam Graves,
      Chairman, and Hon. Eleanor Holmes Norton, Ranking Member,
      Subcommittee on Highways and Transit of the Committee on
      Transportation and Infrastructure..............................    62
    Letter of April 10, 2017, from Kathy Hope Erickson, Chairman,
      Sitka Tribe of Alaska, to Hon. Sam Graves, Chairman, and Hon.
      Eleanor Holmes Norton, Ranking Member, Subcommittee on Highways
      and Transit of the Committee on Transportation and
      Infrastructure.................................................    65
    Letter of April 12, 2017, from Melanie Bahnke, President,
      Kawerak, Inc., to Hon. Sam Graves, Chairman, and Hon. Eleanor
      Holmes Norton, Ranking Member, Subcommittee on Highways and
      Transit of the Committee on Transportation and Infrastructure..    67
    Letter of April 12, 2017, from Blaine J. Edmo, Chairman, Fort
      Hall Business Council, Shoshone-Bannock Tribes, to Hon. Sam
      Graves, Chairman, and Hon. Eleanor Holmes Norton, Ranking
      Member, Subcommittee on Highways and Transit of the Committee
      on Transportation and Infrastructure...........................    70
    Written testimony of the Poarch Band of Creek Indians............    72
    Written testimony of the Solano Transportation Authority,
      submitted by Hon. John Garamendi, a Representative in Congress
      from the State of California...................................    74
    Report of the American Association of State Highway and
      Transportation Officials, ``AASHTO Implementation Plan for FAST
      Act and MAP-21,'' April 2017...................................    76
    Chart, ``AASHTO Surface Transportation Rulemaking Tracker''......   106

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

             FAST ACT IMPLEMENTATION: STATE AND LOCAL PERSPECTIVES

                                  ----------

                            WEDNESDAY, APRIL 5, 2017

                      House of Representatives,
                  Subcommittee on Highways and Transit,
                Committee on Transportation and Infrastructure,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:02 a.m., in
    room 2167, Rayburn House Office Building, Hon. Sam Graves
    (Chairman of the subcommittee) presiding.
        Mr. Graves of Missouri. We will go ahead and call the
    subcommittee to order. And I would like to say good morning and
    welcome all of our witnesses here today to the hearing. By now,
    we have all seen the reports of last week's fire and the
    resulting collapse of a section of I-85 northeast of Atlanta.
    This is a critically important piece of our infrastructure
    system, which carries over 400,000 cars a day. With that volume
    of traffic, it is amazing that there wasn't any loss of life in
    this incident. And I commend the State and local officials for
    responding so quickly to the crisis. I also want to commend the
    U.S. Department of Transportation for acting quickly to release
    emergency funds and provide assistance.
        We are here to examine the implementation of the FAST Act
    [Fixing America's Surface Transportation Act] with our State
    and local partners. The FAST Act is the first long-term surface
    transportation reauthorization bill in a decade, and it is an
    important foundation for building a 21st-century
    infrastructure. The 5-year bill provides very much needed
    certainty and funding, so that our non-Federal partners can
    make smart, long-term investments.
        The FAST Act is a forward-looking law that puts an emphasis
    on projects of national significance, the movement of freight,
    streamlining project delivery, and innovative solutions to
    transportation challenges. State departments of transportation
    and transit systems and local entities have the important task
    of delivering transportation projects to the communities. And
    as they carry out these projects, the witnesses have a
    firsthand view of how Federal transportation policies are being
    implemented by the U.S. Department of Transportation.
        We look forward to building a 21st-century infrastructure
    with our State and local partners, and we are going to very
    much welcome their input today. I now recognize the ranking
    member of the subcommittee, Ms. Norton, for your opening
    statement.
        Ms. Norton. Thank you very much, Mr. Chairman. Chairman
    Graves, I am very grateful for this subcommittee hearing. I
    think it indicates that our subcommittee wants to get beyond
    all of the interest that we have heard on infrastructure, and
    see what we can really do. We know that a large infrastructure
    package, the idea of a large infrastructure package, which is
    on the minds of many in the administration and on our minds, is
    not going to magically appear. We did a lot of--and I am going
    to say I think deservedly so--a lot of self-congratulation when
    we passed the first surface transportation bill in 10 years,
    and I must say, I am very grateful, Mr. Chairman, that it was a
    good bipartisan effort. And I know you share with me the
    disappointment that in order to get any increase whatsoever
    after 10 years, we had to make a 6-year bill a 5-year bill.
        I don't know how long we can keep that kind of
    disinvestment from going on. I say disinvestment because if you
    are not even investing in a state of good repair, much less the
    new infrastructure we need, you are not investing. We are
    disinvesting. Remember how we built this country. Ever since
    this idea of the Federal transportation infrastructure package
    was created by President Eisenhower, the country has understood
    that you can't be a great country unless you continuously
    invest in infrastructure of various kinds.
        Now the Congressional Budget Office tells us that we face a
    $139 billion shortfall in the Highway Trust Fund just over the
    next decade, if we are trying to continue to fund the FAST Act
    funding levels. And we need $17 billion more a year than FAST
    Act levels at the Federal level to improve our infrastructure
    and to maintain a state of good repair.
        I am very pleased that the President has said good things
    about infrastructure, so I hastened to get a hold of his so-
    called skinny budget, and was very disappointed to see really
    unheard of cuts to popular transportation programs. So instead
    of investing, after my hopes had been raised, for example, in
    transit, urgently needed to alleviate congestion, the President
    wants to stop all new investments in transit by cutting off the
    New Starts program.
        I am grateful, nevertheless, for the continuing
    bipartisanship on this committee. I was pleased to sign a
    letter with Chairman Graves and the leadership of the full
    committee to urge the Appropriations Committee to fully fund
    all FAST Act programs as authorized for the remainder of 2017
    and in the upcoming 2018 budget. I am still banking on a
    President that talks about $1 trillion proposal, at least
    supporting us as we fight to maintain the meager funding levels
    we had. And I am not pulling my hair out that the President's
    cuts will go through, because no matter who is President, the
    appropriators always rewrite the budget.
        But I am concerned that the administration seems to be more
    enamored with pushing private capital and financing--which
    would end up making projects more expensive than traditional
    funding mechanisms--and regulatory reforms than making real
    investment. An investor-centered approach will do little to
    improve infrastructure across the Nation. I mean, you simply
    can't build your infrastructure and expect that toll roads will
    somehow pay for it. There must be a revenue stream, and for the
    modern era in American life, it has always begun with this
    committee and subcommittee. Nor can we streamline our way out
    of inadequate funding. Secretary Chao said recently the problem
    is not money.
        Imagine saying that about roads and transit. The problem is
    always money. She didn't say that last part. That was
    editorializing.
        She said it is the delays caused by the Government
    permitting processes that hold up projects for years, even
    decades, making them risky investments. But, in fact, if you
    check the data, only 4 percent of all infrastructure projects
    nationwide undergo any rigorous environmental review. Most of
    it is what you and I see every day, 90 percent of projects
    received from categorical exclusion through the categorical
    exclusion process, and are exempt from rigorous levels of
    review. A recent inspector general report also refutes the
    notion that more streamlining now is the prudent cost of
    action. It concludes that additional streamlining provisions in
    the FAST Act are actually slowing down the U.S. Department of
    Transportation's ability to implement the project delivery
    accelerations put into MAP-21.
        In other words, piling streamlining measures on top of each
    other, before they can be implemented, simply does not help,
    and, frankly, does not happen. I have always defended
    opportunities for public participation in NEPA, and continue to
    believe that it helps us to improve the ultimate projects.
    Community input and buy-in are crucial to the successful and
    expeditious advancement of transportation projects. Gutting
    public participation in the name of cutting redtape is
    something that will harm our roads and will harm the
    constituents who use our roads and infrastructure.
        I don't believe we can reinvent the wheel when it comes to
    transportation and infrastructure. I just think there is no way
    around our obligation as the Congress of the United States to
    provide the States and local governments with the funding and
    the flexibility that they alone know what to do with to produce
    smart and efficient projects, allowing the States, who have the
    wisdom, once we give them the money to go ahead.
        I very much look forward to today's witnesses. I have read
    the headlines, Mayor Reed, about Atlanta and I-85. It will be
    interesting to hear what we can do and what you can do on that
    unforeseen circumstance. Thank you very much, and I look
    forward to the testimony. Thank you, Mr. Chairman.
        Mr. Graves of Missouri. Thank you, Ranking Member. I now
    turn to ranking member of the full committee, Mr. DeFazio.
        Mr. DeFazio. Thank you, Mr. Chairman. Thanks for this
    important hearing. I will just restate a few things because
    they do merit restating. We have an $836 billion backlog on
    unmet capital investment needs for highways and bridges; nearly
    140,000 bridges need repair or replacement; and over $90
    billion just to bring existing transit up to a state of good
    repair, let alone build out new transit options for people.
    Yet, we haven't increased the user fee here in Washington, DC,
    in a quarter of a century.
        Over the past few years, 17 States have raised their gas
    tax, and nobody has been recalled. Nobody has lost their
    reelection, and it has not been a controversy. The American
    people get it. They are tired of sitting in traffic. They are
    tired of blowing out tires in potholes. They are tired of being
    detoured around weight-limited or closed bridges. They are
    tired of the decrepit state of our mass transit, and they want
    to see action.
        So, today, I am sending Secretary Chao a letter urging her
    to come down and work with Congress to create a consensus
    around real investment, and real solutions for the Nation's
    infrastructure problems.
        I am hearing a lot of talk about, well, it is going to be
    P3s; it is going to be infrastructure banks; it is going to be
    private tax credits, and we are going to streamline the Federal
    approval process. Let's address that briefly.
        First off, most P3s are projects $1 billion or larger. You
    have got to have a rate of return. You have got to attract the
    investment. They have to be tolled, or some other way, you
    know, to recoup the investment, and they are generally 5-to-1
    public money to private money. Now, the Speaker has said he
    wants 40-to-1 private money to public money. That means no more
    P3s. There are no investors out there who are going to put up
    at a 40-to-1 ratio and do a P3. They generally put up 10 to 15,
    at the most, 20 percent, and the rest comes from TIFIA or local
    bonding or State bonding, municipal bonds, whatever. That is
    myth number one.
        Now, infrastructure, banks, private-activity bonds, you
    know, those are new forms of local borrowing. Again, they
    require a revenue stream, hence tolling or some other way of
    recouping the investment. And, of course, they do increase the
    costs.
        Now Secretary Chao unfortunately was given some alternate
    facts by somebody. She stated: ``Investors say there is ample
    capital available waiting to invest in infrastructure projects,
    so the problem is not money. It is the delays caused by
    Government permitting processes that hold up projects for
    years, even decades, making them risky investments.'' No. No.
    That is not the problem. In fact, we made 42 major policy
    changes for streamlining in MAP-21. Not all of those have been
    implemented yet. In fact, some of them have run into conflicts
    with the FAST Act. So, we did streamlining. We did more
    streamlining on top of streamlining. Let's get all that
    implemented and see if there is still any issues. I don't think
    you will find many. In fact, more than 90 percent of the
    projects go forward under categorical exclusion, which is
    basically filling out a few sheets of paper, and it might take
    you 1 month or 2 months at the most.
        So that isn't the issue here. You can't streamline your way
    out of a lack of funding. So, you know, 4 percent of projects,
    4 percent, require environmental impact statements. And as
    Ranking Member Norton noted, most of those are held up at the
    local or State level because of controversy surrounding those
    projects, redesign, and other things which came out in
    hearings, which are required under the NEPA process. But that
    is 4 percent of the projects. So 96 percent don't even have to
    go through a rigorous environmental review.
        And a recent report by the Treasury looked at 40
    economically significant transportation and water projects
    whose completion has been slowed or is in jeopardy--ah, proof
    positive about streamlining. No. The report found that a lack
    of public funding is, by far, the major factor hindering the
    completion of those projects.
        So plain and simple, I got a provision in the FAST Act that
    says if Congress appropriates more money to transportation, it
    flows through the policies in the FAST Act. We don't need to
    spend a year or two rewriting the policies, arguing over
    transit highway split, arguing over enhancements, arguing over
    how much goes to freight, how much goes here, how much goes
    there, arguing. We don't have to go through any of the policy
    debate. All we need to do is have the guts to put up a little
    bit of money, and that is why I introduced A Penny for
    Progress. And as I have said before, if anybody around here
    thinks they are going to lose their election if they vote on
    something that caps the indexation increase at 1\1/2\ cents a
    gallon a year, then you don't belong here. Thank you, Mr.
    Chairman.
        Mr. Graves of Missouri. Thanks, Ranking Member. I will now
    introduce our panel. And first I would like to introduce Mr.
    Mike Patterson, who is the executive director of the Oklahoma
    Department of Transportation. He is testifying on behalf of the
    American Association of State Highway and Transportation
    Officials. We also have Mr. Gary Thomas, who is president and
    executive director of the Dallas Area Rapid Transit. And he is
    testifying on behalf of the American Public Transportation
    Association. And I would like to recognize Ms. Johnson of Texas
    to make a formal introduction of Mr. Thomas.
        Ms. Johnson of Texas. Thank you very much, Mr. Chairman. As
    a Representative from Dallas, I am proud to introduce not only
    a friend and partner, but a good executive, who is Mr. Gary
    Thomas, president and executive director of the Dallas Area
    Rapid Transit, which we call DART. He and I worked
    cooperatively together for many years to cultivate our great
    city of Dallas into an interconnected transit hub that it is
    today as the largest growing metropolitan area in the country.
        He joined DART in 1998, and has since grown DART's light
    rail system into the Nation's longest and largest at 93 miles
    long. Under his leadership, DART has become a leading example
    for the Nation of how to effectively manage and grow a
    flourishing public transit network. I happen to know that DART
    also has very strong working relationships with our Federal
    partners at USDOT and the Federal Transit Administration,
    thanks to Mr. Thomas.
        He is also very effective at cultivating strategic
    partnerships with local stakeholders to meet the needs of the
    robust multimode transit network in the Dallas metroplex. And
    with that, Mr. Chairman, I am proud to introduce Mr. Thomas to
    the committee with great anticipation to his testimony and his
    plea for money. Thank you, and I yield back.
        Mr. Graves of Missouri. Thank you, Ms. Johnson. And
    finally, we have the Honorable Kasim Reed, who is the mayor of
    Atlanta, Georgia, and he is testifying on behalf of the United
    States Conference of Mayors. And I now recognize Mr. Johnson of
    Georgia to make a formal introduction.
        Mr. Johnson of Georgia. I thank you, Mr. Chairman. It is my
    distinct pleasure to recognize and welcome my friend, Kasim
    Reed, mayor of Atlanta, to this hearing. As we convene this
    hearing this morning, I can think of no better witness to offer
    than the Honorable Kasim Reed. Mayor Reed, when he first came
    into office, he balanced Atlanta's budget, and he took care of
    the challenge of the unfunded pension system which had been
    languishing for many years. That has been taken care of
    successfully 6 years ago, or 7 years ago, actually. He has
    invested in hiring more police officers in Atlanta. Our crime
    rate continues to go down. Mayor Reed is the 59th mayor of the
    city of Atlanta, serving in that capacity since 2010. Mayor
    Reed is known for building relationships and working in a
    bipartisan way with local, State, and Federal stakeholders on
    economic development and transportation issues.
        During his tenure, Atlanta has experienced significant
    economic development and a population boom. For instance, his
    work with Governor Nathan Deal and the Obama administration to
    obtain Federal support for the Port of Savannah Harbor
    Expansion Project, has resulted in much economic development
    for the Atlanta region and for the State of Georgia. The city
    has responded by undertaking an ambitious agenda to upgrade
    roads and bridges and improve the city's transportation
    infrastructure.
        The city of Atlanta, under Mayor Reed's leadership, is
    currently undergoing a historic $2.6 billion expansion of the
    Metropolitan Atlanta Rapid Transit Authority, or MARTA, as well
    as expanding and completing unique projects such as Atlanta's
    BeltLine, which is a 22-mile stretch of trails and transit
    around the city on abandoned railways. This project has opened
    up a lot of economic development in terms of new housing,
    rehabilitated housing, new residents coming in, businesses
    opening up, communities being created that are walkable,
    bikeable, and interconnected. And also, at the same time, he
    has presided over the opening of the Maynard H. Jackson Jr.
    International Terminal at the Atlanta Airport as Atlanta
    matures into a world-class city. He is overseeing, currently, a
    $6 billion expansion of the Hartsfield-Jackson Airport, an
    international airport, the world's busiest airport; at the same
    time building a state-of-the-art stadium for our dear Falcons.
    It nears completion, world-class facility with a retractable
    roof.
        So much that we can talk about, Mayor Kasim Reed's
    leadership. He is leveraging the strength of partnerships with
    the State of Georgia, colleges and universities, and the
    private sector to build an innovative transportation
    infrastructure that ensures mobility and creativity for
    Atlanta's residents, businesses, and visitors, all taking place
    while Atlanta remains an affordable city where everyday working
    people can afford to live, work, and play. With that, I am
    proud to introduce to this committee, Mayor Kasim Reed.
        Mr. Graves of Missouri. Thank you, Mr. Johnson. With that I
    would ask unanimous consent that our witnesses' full statements
    be included in the record. Without objection, that is so
    ordered. And since your written testimony is going to be made
    part of the record, the committee would ask that you please
    limit your summary to 5 minutes.
        With that, Mr. Patterson, we will start with you.

    TESTIMONY OF J. MICHAEL PATTERSON, EXECUTIVE DIRECTOR, OKLAHOMA
        DEPARTMENT OF TRANSPORTATION, ON BEHALF OF THE AMERICAN
    ASSOCIATION OF STATE HIGHWAY AND TRANSPORTATION OFFICIALS; GARY
    C. THOMAS, PRESIDENT AND EXECUTIVE DIRECTOR, DALLAS AREA RAPID
       TRANSIT, ON BEHALF OF THE AMERICAN PUBLIC TRANSPORTATION
    ASSOCIATION; AND HON. KASIM REED, MAYOR OF ATLANTA, GEORGIA, ON
            BEHALF OF THE UNITED STATES CONFERENCE OF MAYORS

        Mr. Patterson. Thank you, Mr. Chairman, members of the
    committee. My name is Mike Patterson. I am the executive
    director of the Oklahoma Department of Transportation, ODOT,
    and I am here today to testify on behalf of ODOT and the
    American Association of State Highway and Transportation
    Officials, AASHTO. First, we want to thank you, Mr. Chairman,
    and other members of your committee, for your leadership and
    efforts to increase the efficiency of delivering transportation
    projects. In collaboration and in cooperation with the Federal
    Government, the State DOTs continue to seek opportunities and
    create solutions to solve the deteriorating national
    transportation system. All of us have come to realize that
    additional funding is important. That serves as a partial
    solution to the problem. The FAST Act's authorization of $305
    billion for Federal highway safety, transit passenger rail
    programs from 2016 to 2020 could not have been timelier in
    spurring our economic growth and investment in our multimodal
    transportation infrastructure. But equally important to
    initiating and completing transportation investments in a
    timely matter involves major programmatic and policy reforms
    contained in both the FAST Act and MAP-21.
        It is our hope that Congress will feel comfortable in
    seeking additional reforms that will provide further
    opportunities to improve the efficiency and effectiveness of
    transportation programs and project delivery while remaining
    responsible stewards of taxpayer resources in both human and
    natural environments.
        Moving forward, we must develop a modern revenue model for
    funding our surface transportation investments. The days of
    almost total reliance on consumption tax for a fleet of ever-
    increasing fuel-efficient vehicles is nearing its end. What we
    consider innovative funding today must and will become a new
    normal for funding transportation. Until that time, it is
    imperative that the annual obligation authority in the FAST Act
    be fully honored, the structural cash flow deficit in the
    Highway Trust Fund be resolved, and the schedule of recisions
    of contract authority be abolished.
        Even in today's environment of financing solutions, it
    remains imperative that direct funding of transportation
    investments remain the primary focus. The reality remains that
    most transportation projects cannot generate adequate revenue
    to service debt or provide the return on investment required by
    private sector equity holders.
        Everyone recognizes that the FAST Act provides only a near-
    term solution to the Federal surface transportation funding.
    That is because the Highway Trust Fund continues to remain at a
    crossroads. The Highway Trust Fund has provided stable,
    reliable, and sometimes substantial highway and transit funding
    for decades since its inception in 1956, but this is no longer
    the case. Since 2008, the Highway Trust Fund has been sustained
    through a series of general fund transfers now amounting to
    $140 billion. According to the January 2017 baseline of the
    Congressional Budget Office, the Highway Trust Fund spending is
    estimated to exceed receipts by about $17 billion in fiscal
    year 2021, growing to about $24 billion by 2027.
        Furthermore, the Highway Trust Fund is expected to
    experience a significant cash shortfall in 2021, since it can't
    incur a negative balance. AASHTO estimates that States may see
    a 40-percent drop from fiscal year 2020 to the following year,
    from $46.2 billion to $27.7 billion. In the past, such similar
    shortfall situations have led to the possibility of reduction
    in Federal reimbursements to States on existing obligations
    leading to serious cash flow problems for States and resulting
    in project delays.
        Based on the Federal Surface Transportation Program's long
    track record of efficiency and flexibility, we recommend that
    any increase in Federal funds should flow through the existing
    FAST Act formula-based program structure, rather than through
    untested approaches that require more time and oversight.
        Though certainly significant, benefits from investment in
    transportation infrastructure go well beyond short-term
    construction jobs created. A well-performing transportation
    network allows businesses to manage inventories and move goods
    more cheaply across a variety of suppliers and markets for
    their products and get employees reliably to work.
        Congress should encourage the USDOT to implement the
    provisions of both MAP-21 and the FAST Act, fully consistent
    with legislative intent. An example of the problematic USDOT
    regulatory action is the onerous and the unanticipated
    requirement regarding Metropolitan Planning Organization, MPO,
    coordination. Although State DOTS and MPOs already exemplify
    the kinds of coordination sought, the new regulation added
    significant legal and administrative requirements that would
    serve as barriers to constructive and flexible approaches to
    planning and programming being implemented by States and MPOs
    today. Along with the Senate's recent passage of companion
    legislation to repeal this rule, we appreciate your committee's
    prompt action last week to bring this before the House floor.
        Mr. Chairman, thank you for conducting this important
    hearing to bring a greater awareness of transportation
    infrastructure needs of the Nation, and thank you for the
    opportunity to provide testimony. We will be happy to answer
    any questions the committee may have.
        Mr. Graves of Missouri. Thank you, Mr. Patterson. Mr.
    Thomas.
        Mr. Thomas. Thank you, Mr. Chairman. My name is Gary
    Thomas, and I am the CEO of Dallas Area Rapid Transit. I
    certainly appreciate the work that this committee does, and
    thank you, Congresswoman Johnson, for your kind introduction;
    but more importantly, thank you for what you do in our region.
    You have been the stalwart congresswoman for our region for
    many, many years, and we certainly appreciate the impacts that
    you have had.
        I am grateful for the opportunity to talk about the impact
    that the partnership with the Federal Government, and most
    specifically, the FAST Act, is having on our community. DART
    was created in 1983, when north Texans voted to tax themselves
    a 1-percent sales tax to create a transit agency that, quite
    frankly, they didn't know what it was going to do at that point
    in time. Today, DART is a multimodal transit agency operating
    North America's longest light rail system in the fourth largest
    metropolitan area in the United States.
        The 2.3 million residents of our 13-city, 700-square-mile
    service area, count on DART's network of bus, light rail,
    commuter rail, and paratransit services, to give them a choice
    to get them where they need to go every single day.
        I have been part of the public transportation industry now
    for 30 years, and CEO since 2001. Public transportation is
    changing the way American communities grow. Equally
    importantly, we are seeing a significant return on the public
    investment. Transit-oriented development along DART rail lines
    has generated more than $7 billion in economic impact from new
    or planned construction. Additionally, in 2014 and 2015, there
    were 43,000 jobs that were created as a result of this
    development, resulting in nearly $3 billion in wages, salaries,
    and benefits.
        Now in our region, customers insist on being mobile and
    being connected. Our GoPass mobile ticketing app was one of the
    first in the industry to respond to that demand with a
    multiagency and multimodal fare payment system. Just over 2
    years ago, we began working with car and ride-sharing companies
    like Lyft, Uber and ZipCar to allow our customers to position--
    to provide a more complete trip. In other words, first-mile,
    last-mile opportunities. Now we are using a Federal Sandbox or
    Mobility on Demand Grant to make it easier for car and ride-
    sharing customers to connect with transit through that app.
        Our congressional delegation knows the Federal funds
    invested in DART will generate significant economic impact, and
    a higher quality of life in our region. We are pleased to enjoy
    consistent, bipartisan support. We also believe that we need to
    bring money to the table. Voters in our 13 cities decided to
    dedicate a portion of their sales taxes to help fund transit in
    their communities. We used that to leverage Federal dollars.
    The FAST Act and its predecessors are difference makers in
    north Texas, so you can imagine the disappointment we had when
    we heard the details of the administration's 2018 budget.
        DART's success is prompting calls for more service, as you
    might imagine. We are advancing plans for a second light rail
    line in downtown Dallas that we hope will be partially funded
    by a Core Capacity Grant. Unfortunately, the budget proposal
    would foreclose this possibility, so despite significant local
    investment, the project would be delayed at least 10 years
    without Federal funding support. Yet we need the capacity
    today.
        We are also bringing an old railroad corridor, the Cotton
    Belt, to life with a new commuter rail line, adding a new rail
    connection to DFW International Airport. In response to local
    demand, we are able to accelerate that project by more than a
    decade with the help from a RRIF loan, a Railroad
    Rehabilitation and Improvement Financing loan through the
    Federal Railroad Administration.
        Federal support has helped us complete the conversion of
    our bus fleet to compress natural gas. In addition, we are
    using Federal funds from the low- and no-emission bus program
    to purchase seven electric busses that will be in operation
    next year. We have been aggressive and intentional in seeking
    creative ways to fund and deliver our projects. It certainly
    doesn't hurt that we have been able to develop a reputation for
    consistently being under budget and ahead of schedule on our
    projects.
        Our mobility challenges are difficult, but certainly can be
    solved. People in communities everywhere are working on
    solutions that meet their unique needs. They have the vision
    and the desire. They need help with the funding. We believe
    there is a role for local communities to partner with the
    Federal Government to work together to support these visions
    with sustainable, substantial, and predictable funding that the
    FAST Act provides. I cannot impress upon the committee strongly
    enough how important it is to keep the FAST Act intact and that
    commitment intact as we move forward.
        Thank you very much, Mr. Chairman, and members of the
    committee. I look forward to answering any questions.
        Mr. Graves of Missouri. Thank you, Mr. Thomas. Mayor Reed.
        Mr. Reed. Thank you. Mr. Chairman, and members of the
    committee, I want to thank you for the opportunity to be here
    today. I also want to thank my congressman from Georgia----
        Mr. Shuster. Mayor, could you pull that mic a little closer
    to you? I want to make sure I hear every single word you say.
        Mr. Reed. Thank you, Representative Shuster. I also want to
    thank my friend, Congressman Hank Johnson, for that kind
    introduction. I am very hopeful that my wife was watching. That
    made me feel good about myself. Thank you, Congressman Johnson.
    I also want to thank the administration and this committee for
    your help with regard to the crisis that we have faced with the
    collapse of the I-85 interstate in Atlanta, Georgia. The level
    of cooperation from our Federal partners could not have been
    stronger, and I wanted to take this opportunity to express my
    personal gratitude.
        I come here today as the mayor of Atlanta and the chairman
    of the Transportation Committee for the U.S. Conference of
    Mayors. The challenge that we are having in Atlanta with I-85
    and its collapse really points out that an overall
    transportation system is needed now more than ever. In fact,
    since we have been facing this challenge with I-85, the use of
    MARTA, the ninth largest public transit system in the United
    States, has increased by more than 29 percent as we work
    through the challenge we are facing. So alternatives, including
    resilient models, we think will be increasingly important in
    the 21st century.
        But we are also investing in roads, which is an issue that
    I know is very important to members of this committee as well.
    In 2015, the State of Georgia passed H.B. 170 under the
    leadership of Governor Nathan Deal, which raised the gas tax in
    order to fund nearly $1 billion annually for bridge and road
    repair, so we are working hard to keep our own house in order,
    in addition to having a strong relationship with our Federal
    partners. The city of Atlanta is also moving full speed ahead
    and leading in our own way.
        Last November, the city moved forward with a half a penny
    sales tax referendum, which would generate $2.6 billion for
    MARTA, and this item passed with 71 percent voter support. We
    also had a second ballot measure, a TSPLOST, for four-tenths of
    a penny, which will raise an estimated $300 million for
    infrastructure projects, and it received 68 percent support.
        So I think it is important to realize that in Georgia and
    in the metro area, we are focusing on roads and partnership
    with the State, but we are also not leaving our transit
    responsibilities and capabilities behind. City residents are,
    indeed, voting with their pocketbooks, and businesses are
    voting with their feet.
        In the last 42 months, after we have made these investments
    in improving our road infrastructure and our transit
    infrastructure, we have won 17 either regional or U.S.
    headquarters in the city of Atlanta. They include businesses
    like NCR, Honeywell, GE Digital, UPS. We have had the largest
    net increase of jobs into the city in more than 40 years after
    making these infrastructure investments. This would not have
    been possible without the stability that was provided by the
    FAST Act and your leadership in making that legislation
    possible. So I wanted to thank you for that.
        In the last 2 years, Atlanta taxpayers have focused
    increasingly on making sure that we fund our share of
    infrastructure, and I think it is important to note that we ask
    this committee, as you develop future legislation, to always
    keep in mind what the local community has invested as we try to
    attract grants and Federal support. We are fixing roads and
    bridges, engineering more than 30 miles of complete street
    projects, including bicycle lanes and traffic light
    synchronization initiatives. As a result of all of these items,
    the city of Atlanta's credit rating has improved 7 positions, 7
    positions, to AA plus as rated by Standard and Poor's, Moody's,
    and Fitch. The point we are making is, is that when you invest
    in these critical infrastructure items, the market responds,
    and the business community responds.
        Modest expansion means the potential is very real for new
    light rail transit and flexible bus service that will connect
    with existing heavy rail and the Atlanta Streetcar systems.
    None of this would have been possible without your committee's
    support. Mr. Chairman, that concludes my testimony.
        Mr. Graves of Missouri. Thank you very much, Mayor. We will
    now turn to Chairman Shuster of the full committee.
        Mr. Shuster. Sorry I am late. I did make it to hear all
    your testimony. I want to thank you all. Mr. Patterson, Mr.
    Thomas, thank you for bringing your expertise, and thank you,
    Mayor Reed, for being here again. Outside of the Ninth
    Congressional District, I think you are probably my favorite
    mayor in America, because you really understand infrastructure.
    I am so sorry for what happened down there on the bridge in I-
    85, but from what they are telling me, they are going to
    rebuild that bridge in about 80 days. This is certainly a
    tragedy. Thank goodness, thank God nobody was killed, but we
    ought to pay very, very close attention to how fast this moves
    because we need to learn from this as we did by the Interstate
    35 bridge several years ago. They built that bridge in about
    just shy of 400 days. These are the kinds of things that we
    should learn from as you move forward because it is going to be
    critical to do that.
        I was late because I spent an hour, just an hour with
    Secretary Chao. She came and briefed about 45 Members of
    Congress. She talked about the infrastructure bill and how
    important it is to the President; and, of course, 40, 45
    Members were there asking a lot of great questions, and there
    is a Federal component to it obviously, and we have got to
    figure the revenues out, how we get more revenues. Public-
    private partnerships are a tool in the toolbox, but it is not
    the toolbox. It is a good tool; we need to make it better. And
    then figuring out how to unleash the private dollars. As I talk
    to people around the country, there is a $2 billion road
    project in California right now--$2 billion dollars, $50
    million of it is Federal money. The rest is California money,
    and State, local, private-sector dollars, they want to get
    about $500 million or $600 million in a TIFIA loan, and they
    are dragging their feet. These are the kinds of things we have
    to get out of the way of the States and the locals to move
    these projects forward.
        So I really appreciate the three of you being here today.
    Thank you so much. But I would be remiss if I didn't introduce
    and welcome to the committee the dean of the Secretaries of
    Transportation--the dean of the Secretaries of Transportation,
    from Oklahoma, Gary Ridley. Dean Ridley, it is good to see you.
    Just you being in the room, we are all learning through osmosis
    by you being here. So I really always appreciate you being
    here. I will say it again. I thank the three of you for being
    here, and thank you, Chairman Graves, for having this hearing.
        Mr. Graves of Missouri. With that we will open it up for
    questions. We will start with Mr. Barletta.
        Mr. Barletta. Thank you. As most of my colleagues know, I
    grew up working in the road construction business, and that
    experience showed me how difficult it can be for State and
    local governments to move forward with projects when they are
    uncertain about Federal transportation spending. Not only that
    experience, I was a former mayor as well, so I saw it on both
    ends. And that uncertainty trickles down to private industry.
    My family would not hire more workers or purchase more
    equipment without knowing what the future might hold, without
    knowing what kind of work would be out there and for how long.
        Now, under the FAST Act, Federal transportation funding
    runs out in 2020. Can any of you speak how this deadline
    affects your ability to move transportation projects forward?
        Mr. Thomas. Congressman, thank you for the opportunity to
    address that question. From the transit agency's perspective,
    we did a very detailed long-range financial plan, a 20-year
    financial plan, that identifies, assumes, in some regards, and
    identifies all of our revenue and also identifies all of our
    expenses, so our projects are very specific. We make sure that
    we know what we can build, when we can build them, and that we
    can operate and maintain them once we can build them. Not
    having the certainty beyond 2020 certainly prohibits us from
    that certainty, from that reliability of knowing what we can do
    in that 20-year plan. So it limits us as we look at one of the
    fastest, as our congresswoman said, the fastest growing regions
    in the country. We can't always predict and solve some of the
    transportation challenges that we need to be doing now to make
    sure that those projects are in place at that point in time. So
    the long-range funding is certainly critical for transit as we
    move forward. Thank you.
        Mr. Reed. As a follow-on to my colleague's comments, one of
    the things that we could absolutely do right now would be to
    smooth out the process around continuing resolutions, even
    under the FAST Act that we have right now. Whenever we have
    that tension period when we are waiting for the continuing
    resolution process, it affects our ability to budget. And our
    State DOT, for example, is in a position where it can't
    adequately prepare to get projects out waiting for that
    process. So that is something that is within the FAST Act
    structure right now that could help us push a great deal more
    dollars out to businesses to get folks working.
        Mr. Barletta. Thank you. One of the biggest complaints I
    hear from people back home is that redtape and bureaucracy
    consistently hamper investment and innovation. Now, the FAST
    Act called for greater environmental streamlining to get needed
    projects to completion faster. Can any of you speak to the
    success of this attempt? Is it actually happening, or are
    permits still slow to be developed by stakeholder agencies?
        Mr. Patterson. Congressman, as I mentioned in my comments,
    I really appreciate what has happened with streamlining and the
    effects that came out in the FAST Act and MAP-21. We still have
    some challenges. There are rulemaking processes that are still
    underway that we still don't have the rules in place, even
    after 5 years. But it is important that the rules come out
    right. We don't want them just to be expeditiously drawn up and
    be wrong. So we haven't felt all of the effects of your efforts
    and the rest of Congress' efforts to provide that streamlining,
    but we are hopeful that it does come to pass.
        Mr. Barletta. Thank you. And just finally, there is no
    question, we need to find a sustainable funding source for
    infrastructure. We can't keep pulling these rabbits out of our
    hat and these one-trick ponies, one-hit wonders, whatever we
    want to call them here in Washington, but we need a sustainable
    funding source. I support a user fee. I think it is one way
    that we can do that. What solutions do any of you have, maybe,
    for a sustainable revenue stream that we could put in the
    Highway Trust Fund, to help the Highway Trust Fund?
        Mr. Patterson. Congressman, Oklahoma is a member of what we
    call the Western Road Users Consortium. There is a group on the
    east coast----
        Mr. Nadler. Can you speak closer to the mic?
        Mr. Patterson. Oklahoma is a member of the Western Road
    Users Consortium, and there is a group on the east coast that
    is looking at what you call user fees, some sort of way to fund
    transportation beyond the consumption tax that I mentioned in
    my oral testimony. We see that something has to be done, and I
    appreciate the Federal Government and Congress providing some
    grant opportunities for our Western RUC to look at different
    funding mechanisms. I know that Oregon has a test underway, and
    California just entered into that similar kind of test model.
    So States are looking at that, and we hope that the Federal
    Government and Congress looks at our success and our failures
    to develop something for the future.
        Mr. Reed. Last month, we also visited with Representative
    Shuster and Ranking Member DeFazio to talk about their Penny
    for Progress proposal as a guide. Additionally, we really
    strongly believe that local governments and State governments
    that really put skin in the game ought to have a process where
    they have an advanced position in attracting Federal capital.
    So how you all would structure that on a long-term basis we
    would leave to the wisdom of this body. But when a local
    jurisdiction, or a State's citizens raise their hands and say
    we are going to be first in on dealing with our own problems,
    we believe that that municipality or State should be in an
    advanced position, and that significant points should be
    awarded to whatever pool of money you all ultimately make
    available for us to deal with some of these tough challenges.
        Mr. Barletta. Thank you. Thank you, Mr. Chair.
        Mr. Graves of Missouri. Ranking Member Norton.
        Ms. Norton. Thank you, Mr. Chairman. I would be interested
    in knowing if any of your States have raised the State gas tax
    and what the effect on public opinion was, and what do you
    think would be the effect of raising the Federal gas tax now
    that perhaps some State gas taxes have been raised? I would be
    interested in what all of you have to say about that.
        Mr. Thomas. Yes, ma'am, Ranking Member. Texas has not
    raised their gas tax since 1992, so it is much the same case.
    But when you watch gas prices every day swing 10, 15 cents a
    gallon, I am not sure how much a penny, penny and a half, 2
    pennies would be noticed. Certainly there have been
    conversations in Austin about gas tax, about vehicle miles
    traveled. There have been a lot of suggestions. We recognize,
    as a State, that something needs to be done, but much like what
    is happening across the country, a lot of conversation. We just
    haven't made that decision yet.
        Ms. Norton. Mr. Patterson or Mayor Reed?
        Mr. Patterson. Oklahoma has not raised our gas tax since
    1987. Governor Fallin has proposed to increase our fuel tax. It
    is estimated that by June, we will have the lowest fuel tax in
    the country at 14 cents for diesel----
        Ms. Norton. So how is that working out for you?
        Mr. Patterson. It is not working out too well. So Governor
    Fallin has made that proposal to increase it to 24 cents for
    each diesel and gasoline, and it is going through the
    legislative process at this point.
        Ms. Norton. Mayor Reed.
        Mr. Reed. Yes, ma'am. Our Governor, Nathan Deal, in 2015, a
    Republican Governor with almost near constitutional majorities
    in our House and in our Senate in Georgia with Republican
    majorities in both, raised the gas tax and raised $1 billion as
    a result of that. In the city of Atlanta, in November, we
    passed $2.6 billion for the largest expansion of our transit
    system in history. It passed with 71 percent local support. We
    also had a TSPLOST funding measure that passed with 68 percent
    local support to fund more than $300 million in infrastructure.
    A year prior to that, we had a local referendum for a $250
    million infrastructure bond. It passed with more than 80
    percent support.
        So my State--I am from the State of Georgia--we have a very
    conservative State, and all of these measures have been passed
    with broad majorities. The legislative majority was in the
    general assembly for the $1 billion in road money, and then the
    other items that I referenced regarding MARTA, our transit
    system, and our infrastructure funds, have been done within the
    city of Atlanta. So I think it is a nice mix of urban and rural
    showing that whether you are focused on rural folks or urban
    folks, people get that we need significant infrastructure
    investment.
        Ms. Norton. Very instructive. Conservative or Republican,
    nobody has found a way to build roads and bridges and transit
    systems without money. I am interested in what the States have
    done because almost half the States have taken the initiative,
    seeing that the Federal Government is stuck and has been stuck
    for a generation.
        One more question. I got into the FAST Act--actually it was
    the idea of a number of us--funds for alternatives. We don't
    just criticize the fact that Congress won't, or your States or
    those two States for that matter, continue to ignore the need
    for funds. We look for alternative funds, and note that some
    States have found alternative ways, or suggested alternative
    ways, or are actually experimenting. There is $10 million in
    the FAST Act for such experimentation. Looking at the notions
    to come forward recently about private investment as a way to
    fund roads and the investors getting back their investment
    through, I suppose, fares or tolls or the rest, I would be
    interested in knowing whether you think relying more heavily on
    private investment would help us, in fact, hasten the work that
    needs to be done on our roads, bridges, and infrastructure?
        Mr. Patterson. In Oklahoma, and in many States, we have
    seen a reliance more on private investors. In Oklahoma, we have
    our turnpike authority, which was created back in the late
    1940s, to develop a high-speed, safe transportation facility
    between Oklahoma City and Tulsa. From that point, it has
    expanded on, and it is clearly a tolling authority, but the
    private investors are the moms and pops around the country that
    buy bonds. So we can't forget that that is a private investing
    opportunity.
        Ms. Norton. But could you build most of the roads using
    tolls? Would the public tolerate that?
        Mr. Patterson. No, ma'am, we can't, and we realize that. We
    understand that at this point, many States are relying on some
    sort of tolling to make up the difference between adequate
    funding between both the State and Federal level.
        Ms. Norton. Could I just get answers from the other two
    witnesses, please?
        Mr. Reed. Congresswoman, I think that it depends, as long
    as you keep your focus on project models versus tax credit
    models. So, I think that the conversation has to be around real
    projects. Probably the most successful public-private
    partnership we have in our city is a project called the Atlanta
    BeltLine, where we reclaimed 22 miles of old abandoned
    railroads, and now, the $400 million in public support has
    triggered $3.8 billion in private capital attracted to
    renovating that entire corridor, and creating 1,200 acres of
    green space. That is a project model where everybody knows
    where the focus is going to be, and everybody is tracking the
    jobs that are being created. The concern that we are
    experiencing is moving to a tax credit model for the financial
    services community or financiers. And so that is the
    distinction that I think is going to be really important as we
    have this conversation. The most striking and most successful
    public-private partnerships that I have seen have been project-
    specific with very broad community buy-in.
        Ms. Norton. Mr. Thomas.
        Mr. Thomas. Yes, ma'am. From a transit industry
    perspective, it is a little bit different. Transit P3s are a
    great opportunity perhaps, as long as you understand going into
    it that that money is going to cost you more than what you
    could typically borrow other places, so there are levels of
    public-private partnerships. Certainly in one case, where we
    worked very closely with Uber and Lyft, that is a public-
    private partnership of sorts. On the other hand, when we do a
    design-build project, that is a public-private partnership,
    perhaps at the lowest level, but no funding or financing
    involved. When you get to the funding and financing level, and,
    of course, the associated risk-sharing opportunities, those
    cost more money. The private sector is going to expect higher
    interest rate on the money that they put into a project than
    what we can typically get through the Federal funds, or even a
    RRIF or TIFIA loan.
        Ms. Norton. Thank you very much.
        Mr. Graves of Missouri. Mr. Davis, 5 minutes.
        Mr. Davis. Thank you, Mr. Chairman.
        Thank you to the witnesses. Mayor Reed, sorry about the
    Braves on opening day. Not an easy thing, especially after the
    Falcons.
        Mr. Reed. I hadn't gotten over the Falcons, but I
    appreciate it. I appreciate all the good will I can get.
        Mr. Davis. Well, we don't want to remind you of bad things
    happening to Atlanta sports, but as a Braves fan myself, it is
    always good to have the mayor of Atlanta here. I want to ask
    you about funding set aside under the Surface Transportation
    Block Grant Program that is suballocated to localities. STBG,
    formerly STP, is the most flexible formula transportation
    funding available to States and municipalities to improve
    Federal highways, Federal aid highways and bridges. And I was
    pleased that the FAST Act took important steps to gradually
    increase STBG allocation closer to traditional levels, reaching
    55 percent by 2021.
        Mayor, can you explain for the committee the importance on
    increasing the suballocation of these funds for local
    communities like yours to be able to address your
    transportation and infrastructure problems?
        Mr. Reed. Congressman Davis, I think that they are
    absolutely vital, and they will encourage local municipalities
    to deal with our infrastructure challenges.
        The one point that I would make here is one I have already
    made, which is that I do believe that local governments that
    really step up and start solving these problems on their own
    should have a dynamic competitive advantage. And that is not,
    in my opinion, enough of the consideration as a part of this
    process. I believe that the steps that were already taken have
    been vital, but I do believe that our Federal partners could
    encourage us to do more on our own in order to be rewarded for
    that good behavior.
        Mr. Davis. Well, I appreciate hearing that, Mayor. And
    also, I am pleased, you know, that the FAST Act does gradually
    increase that local control by increasing the suballocation for
    STBG, but I would have preferred for actually a larger
    increase. And that is why I, along with my friend, Ms. Titus
    from Nevada, advocated for language that would have gradually
    increased that suballocation to 60 percent by 2021. And while
    we were ultimately unsuccessful, I still believe we should look
    at ways to increase the local control and flexibility of these
    transportation dollars.
        Do you have any suggestions additionally to what you
    responded to my previous question with, that Congress could
    take to further promote local control and help communities
    better address your priorities?
        Mr. Reed. I think holding up national models that Congress
    has confidence in for other governments to see would be very
    helpful. In other words, having some forum playing a
    clearinghouse function where the answer isn't always additional
    money or capital, but the answer may be that these are
    governments that are taking on these challenges and handling
    them well from a financing standpoint and execution standpoint,
    and a value of the dollars generated, because everybody's going
    to come here and ask for more money. But, if you are a local
    leader or a mayor, you have an end date. And to the extent that
    a body like yours held projects out as models after you
    verified them and are prepared to put your stamp of approval on
    it, I think that it would make it much easier to scale these
    projects around the country in communities large and small.
        Mr. Davis. That is great advice. And do you have any
    projects that you might want to mention here to the committee
    that are working well as maybe public-private partnerships
    regarding infrastructure improvements in Atlanta?
        Mr. Reed. Absolutely. I believe that the Atlanta BeltLine
    is as successful a private-public partnership as anywhere in
    the country. If you have been to New York and enjoyed their
    High Line, the Atlanta BeltLine would be the equivalent of
    extending that to Westchester County. It is $400 million in
    public money; it is $3.8 billion in private money; it connects
    45 neighborhoods that used to be separated by freeways. It has
    caused the city to connect just socially in a way that it had
    never connected before. That would be one example.
        Another example would be the Atlanta Streetcar, where we
    had $98 million in public investment and we have had $2.5
    billion in new construction activity within a 5-minute walk of
    that line.
        Mr. Davis. OK. I am not as familiar with that first project
    you mentioned. How are you paying back the private portion as a
    return on investment, what method?
        Mr. Reed. It is through the use of tax credits for
    investments. So, for example, when you invest in the Atlanta
    BeltLine, the public went in and did all of the spending that
    it took to clean and prepare it; and then the private sector
    came in after the public sector went in and identified the
    line. So, for example, there was a 1-million-square-foot
    building that had been boarded up and was dilapidated. It has
    now attracted one-quarter of a billion dollars' worth of
    investment. That used to be owned by my government. I sold it
    to the private sector for $27 million. The private sector came
    in and invested one-quarter of a billion dollars. It is built
    on the Atlanta BeltLine, and now 1.4 million people are using
    the Atlanta BeltLine.
        Mr. Davis. Thank you very much for your responses and
    thanks for being here.
        Mr. Reed. Thank you for the question.
        Mr. Graves of Missouri. Mr. Nadler.
        Mr. Nadler. Thank you, Mr. Chairman.
        Mr. Patterson, your written testimony implies that the FAST
    Act authorization levels rise faster for transit than for
    highways. In fact, highway and transit funding each increase an
    average of 3 percent per year over the 5 years of the FAST Act.
    This committee has stood by the 80/20 Highway Trust Fund split
    for decades. Does AASHTO support maintaining this historic 80/
    20 split between highway and transit funding in future
    transportation bills as we did in the FAST Act?
        Mr. Patterson. Yes, sir, we do. We believe that----
        Mr. Nadler. Talk to the mic, please.
        Mr. Patterson. I'm sorry.
        We do believe that the 80/20 split is appropriate and
    should be maintained.
        Mr. Nadler. Thank you. And, also, your testimony makes a
    compelling argument that direct funding is essential for
    highway and bridge projects. You have made the case that
    public-private partnerships, State infrastructure banks, TIFIA
    credit assistance and local bonding initiatives are helpful,
    but will not replace real direct dollars.
        Can you please explain why most transportation projects
    cannot generate sufficient revenue through tolls, fares, or
    other payment models to provide a return on investment for
    private sector investors?
        Mr. Patterson. When you typically look at a transportation
    project across this country, when you are talking about rural
    or urban situations, there is no opportunity, in most cases, to
    toll that facility. Additionally, there is no economic way to
    capture the dollars that are generated along the route. An
    example, in Oklahoma we have seen where, in a small town in
    southern Oklahoma, they grew out and annexed out to what we
    call Interstate 35. They did that because of the economic
    development the interstate provided to them, but we, as a DOT,
    can't capture that. But there was benefit to the city, through
    additional sales tax.
        Mr. Nadler. Thank you. I have one more question for you,
    sir, and then I will move to the other witnesses.
        Earlier this year, Speaker Paul Ryan suggested that an
    infrastructure package should consist of 98 percent private
    funding. Specifically, the Speaker said that there should be a
    40-to-1 ratio between private sector and public sector funding
    in a Federal infrastructure package.
        Mr. Patterson, your testimony discusses the importance of
    direct Federal funding for transportation, which accounts for
    43 percent of highway capital expenditures nationwide. Do you
    believe that an infrastructure package that relies on 98
    percent private funding can adequately address the needs of
    Oklahoma and other States?
        Mr. Patterson. I don't understand how you get to that
    perspective. It is something that I would have to learn more
    about.
        Mr. Nadler. Well, the perspective is basically that you
    have some sort of tax credits with Federal funding that amounts
    to 2 percent, and the other 98 percent comes in from private
    P3s or something. You don't think that works?
        Mr. Patterson. I don't think it works in Oklahoma.
        Mr. Nadler. But you do think it works elsewhere, just not
    in Oklahoma?
        Mr. Patterson. I can't speak for the other States, but I
    would imagine not.
        Mr. Nadler. Thank you.
        Mr. Thomas, do you agree that public-private partnerships,
    State infrastructure banks, TIFIA credit assistance, and local
    bonding initiatives are helpful, but cannot replace real direct
    dollars?
        Mr. Thomas. They give us tools in the toolbox, but it needs
    to be a complete toolbox. Otherwise, you can't get the project
    done, sir.
        Mr. Nadler. And it is an incomplete toolbox without direct
    Federal funding?
        Mr. Thomas. Yes, sir.
        Mr. Nadler. Thank you.
        Mayor Reed, do you believe that private investors will be
    able to fund the vast majority of highway and transit projects,
    or that most projects will require Federal, State, and local
    funds to complete?
        Mr. Reed. I don't believe that the private market will do
    that, because they will cherry-pick projects, which will leave
    essential projects that we need that are just not as
    financially attractive. And so, the answer is, I believe that
    the public-private partnership model is important, but it will
    not replace the need for our Federal partners to bear the
    lion's share of the load, because the incentive to do a private
    deal is to make a profit for the private sector.
        Mr. Nadler. So, in summary, for all three witnesses, the
    proposal that we have heard--the administration has not made a
    formal proposal, but the proposal that we have heard may be
    coming from the administration that they will do, I think, an
    82-percent tax credit, again, for private partnerships, and
    that will fund $1 trillion in infrastructure. Do any of the
    three of you believe that that would work to fund $1 trillion
    in infrastructure, if the only Federal money basically is an
    82-percent tax credit?
        Mr. Reed. I do not. I believe that you have to have a
    project model, not a tax credit model.
        Mr. Nadler. What do you mean by a project model?
        Mr. Reed. I mean, specific projects that you are
    identifying that the Federal Government is investing into in
    order to create jobs, as opposed to a tax credit model.
        Mr. Nadler. So there has got to be a Federal investment in
    addition to tax credits?
        Mr. Reed. Yes, in addition to a State and a local
    investment.
        Mr. Nadler. Mr. Thomas, Mr. Patterson.
        Mr. Thomas. I agree with the mayor from Atlanta, that there
    has got to be the direct investment and that the tax credits
    wouldn't do it all by itself.
        Mr. Nadler. Thank you. Mr. Patterson.
        Mr. Patterson. I agree with the other two.
        Mr. Nadler. Thank you. So, in summary, all our witnesses
    think that the proposal that I outlined which we have heard
    will be the administration proposal, would not, in fact,
    generate $1 trillion for infrastructure investment or anything
    near it. Is that correct?
        Mr. Patterson. Yes.
        Mr. Thomas. Yes.
        Mr. Nadler. Thank you very much. My time is well expired.
        I thank the chairman for indulging us in the time.
        Mr. Graves of Missouri. Mr. Ferguson, 5 minutes.
        Mr. Ferguson. Mayor Reed, glad to have a fellow Georgian in
    today, and thank you for taking time. I know the new mantra in
    Atlanta, the new hashtag is #IfICanGetThere. It has been tough.
    But I want to thank you all on behalf of the rest of the State
    for your diligence and working, of course, with Governor Deal
    to help mitigate what is a very, very difficult situation for
    not only Atlanta, but the Southeast. And I think it goes to
    show just how important transportation is, that one breakdown
    of the system can have ripple effects throughout an entire
    region.
        Can you speak briefly to the coordination needed between
    local, State, and Federal officials, and, most importantly, on
    the planning process as it relates to transportation projects,
    and also, a little feedback on how the response was from the
    Federal Department of Transportation with the emergency on I-
    85?
        Mr. Reed. Well, thank you, Congressman. And your accent was
    music to my ears. I felt right at home when you said hello.
        Here is what I think: I think that the most important fact
    has been that Governor Deal and I always had a strong working
    relationship. And so, whether it was when the State of Georgia
    was competing for TIFIA funding, or we were competing for a
    number of TIGER grants, or working to deepen the Port of
    Savannah, we have always partnered. And so when you have an
    emergency like we had regarding the bridge collapse on I-85, if
    you work together all of the time in a cooperative fashion, you
    just get through this challenge the way that you will get
    through others.
        The bulk of the credit, Congressman, belongs to our first
    responders. In a tragic event, we had no loss of life, and I
    think the credit to that goes to our firefighters and our
    police officers and our State patrol officers. They
    coordinated. They shut down the highway expeditiously. And then
    we coordinated in deploying resources, which included foam fire
    trucks from Hartsfield-Jackson Atlanta International Airport,
    which were essential in putting the fire out so that less
    damage was done.
        Our Federal partners have been exemplary. They have worked
    in the best tradition of the Federal, State, and local
    relationship. And I had been in multiple meetings, because it
    was sine die for the legislature. We were at the State capitol
    when this crisis occurred, and we instantly began working
    together. And I think that is why we are going to get the
    highway up and operational as soon as we possibly can. And I
    also think that that is why you haven't seen us playing typical
    political games of blames-personship.
        Mr. Graves of Missouri. Ms. Johnson.
        Ms. Johnson of Texas. Thank you. I thank you, Mr. Chairman,
    for this hearing. It has been one that has brought a great deal
    of frustration for me as I sit here and look at that quotation
    up there on the wall. The section of the Constitution, article
    1, section 8, speaks to the Federal Government's responsibility
    toward post offices and roads. We have privatized the post
    office, and I don't know what we are getting from it. But I
    just don't see how we can privatize transportation.
    Nevertheless, I am one of these people that will try to find a
    way to work with any philosophy that I can to try to get a job
    done.
        But this is a tough approach to attempting to address the
    essential transportation problems in our country. So I am going
    to ask Mr. Thomas, how detrimental will these cuts be, or if
    they will be detrimental to the city of Dallas, to DART, and
    the cities across the country if the CIG [Capital Investment
    Grants] programs are cut? We have a lot of plans to accommodate
    the needs in the area, as I am sure every other major city
    does. But when you read the President's budget, what is your
    reaction? Where do we go from here?
        Mr. Thomas. Congresswoman, right now we have three projects
    that are well into the process in the Dallas area alone. Two
    are core capacity projects, and one is a Small Starts project.
    The one is a second alignment through downtown. Again, when
    people think of transit in the United States, they don't always
    think about Dallas, Texas. But as I said earlier, we have got
    the longest light rail system in the United States, in North
    America, for that matter. All of those corridors, all of those
    lines come through a single corridor in downtown right now. If
    there is anything that happens on that corridor, an accident, a
    fire--we had a fire a few years ago. When the firemen lay their
    hoses across the tracks, they don't particularly want trains to
    run across those hoses, and we appreciate that and we
    understand that.
        So we desperately need that second alignment through
    downtown Dallas. We are proposing a 50/50 split, in other
    words, bringing 50 percent of the funding for that project from
    local funds, with a 50-percent match from the Federal
    Government on a core capacity.
        The other project that we are working on is an extension of
    our older platforms, which would allow us on 28 platforms to
    extend those 100 feet, which gives us, just by that alone, 30
    percent capacity increase on those two lines, the Red Line and
    Blue Line. Again, looking for a 50/50 split. TxDOT has actually
    come to the table with half of that, and so we are looking at
    the core capacity program for the other half.
        The third project is an extension of our Streetcar project.
    The Streetcar program that we just opened not too long ago is
    unique, because it uses American-made streetcars, streetcars
    that actually are dual mode. They will operate with an overhead
    wire and without an overhead wire. We intend to extend that
    through downtown Dallas with the Small Starts program. We are
    well into the process, the environmental process, working with
    the community, making sure we know where these projects should
    go, what the alignments are, building that support locally. All
    of those go away. They go away.
        Ms. Johnson of Texas. Now, we still are having tremendous
    growth to the area. So if they go away, where do we go from
    there?
        Mr. Thomas. That is a good question, Congresswoman. You
    know, I think as we look at certainly in our region, but across
    the United States, the impact of the Capital Investment Grants
    has been important, has been critical, as transit agencies have
    continued to provide choices for people in their communities to
    be able to get where they need to go, whether it is to the
    doctor, to the grocery store, and, most importantly, to jobs.
    Well over 80 percent of the people that are riding public
    transportation are going to their jobs.
        So it is imperative that we continue to look for and
    continue to support the FAST Act. It has been incredibly
    successful to this point. I think it is imperative that we
    continue to support that through 2020, at least.
        Ms. Johnson of Texas. Thank you very much.
        Mr. Thomas. Yes, ma'am.
        Ms. Johnson of Texas. Mr. Chairman, my time has expired.
        Mr. Graves of Missouri. Mr. LaMalfa.
        Mr. LaMalfa. Thank you, Mr. Chairman, and, panelists, for
    joining us today.
        Mayor Reed, I will start with you first of all. Thank you
    for being here. And I wish the best to the Braves so long as
    they don't have any cross-interest with the Giants. Former
    National League West mates; now it has all changed. Anyway.
        You know, we have some commonality with emergency
    situations here with you with that bridge and I-85 here. And I
    still harken back to when things went really well after the
    Northridge earthquake in California. This is way back in 1994,
    where it was projected it might be a year, year and a half
    having one of the biggest freeways in the country or the world
    knocked out, that due to a can-do attitude from contractors and
    the State pulling together and putting aside some unnecessary
    redtape, they were able to get that back up within just a few
    months and save much, much loss in economic activity and
    inconvenience to the people in southern California there.
        And so, I hope that that is going well and you are getting
    all the cooperation in the world from the Federal Government
    and others to see your bridge through. My understanding is that
    on the original timetable, from what I saw in the press
    yesterday, moved up from maybe the fall or the winter to maybe
    June. So I hope it is moving fast for you.
        We have an immediate need in our own backyard with--I am
    from northern California, where you may have seen the story
    about Oroville Dam and the spillway problem we had here
    February, and it resulted, partly as a precaution, in an
    evacuation of nearly 200,000 people that were downstream of
    that. Nothing really bad ended up happening with the emergency
    spillway there, but the potential for the erosion that was
    there due to a design that is, indeed, questionable, made that
    necessary for public safety requirements. So infrastructure and
    the public safety are very intertwined, as we have seen.
        Do you feel that the Federal transportation infrastructure,
    the programs that support the locals in increasing public
    safety and being prepared as much as they need to be for
    emergency situations like I am talking about in my backyard or
    SoCal years ago or what you face with the loss of that bridge
    in your area, the Federal Government, are we doing a good
    enough job supporting the local levels in that safety aspect?
    Again, specifying emergency situations where you need quick
    action?
        Mr. Reed. My sense is yes. I chair a group called UASI,
    which is our local disaster planning entity in Metropolitan
    Atlanta. And I think that when it comes to emergency response,
    everything that I have seen shows a high level of
    professionalism and a high level of coordination. And so, that
    is an aspect of the Government that I feel very good about.
        I do believe that we are all going to have to change at the
    local level really to a posture of being resilient, because
    without moving into a debate about climate, weather patterns
    and emergency situations are coming with increasing frequency.
    And, so, I think that this is a conversation we are going to
    have to start having more aggressively with our Federal
    partners.
        The things that you are experiencing in northern California
    really have a great deal to do with being on a permanent
    resilient footing. And as I sit here testifying right now, we
    are experiencing unusually bad weather in the city of Atlanta,
    and have been. And so what is happening is, local governments
    are having to be on an almost permanent footing of responding
    to crises of one kind or another, frequently, weather-related
    crises.
        Mr. LaMalfa. Do you think greater weight should be given to
    not only improved movement, but the flexibility in emergency
    situations that could come through the FASTLANE program?
        Mr. Reed. There is no question about it. Flexibility is
    going to be either the order of the day, or it is going to be
    thrust upon us by circumstances. So I think that it is a more
    thoughtful approach to have flexibility built into the
    relationship as opposed to having good people have to make it
    up at the last minute.
        Mr. LaMalfa. Thank you.
        Mr. Reed. Thank you, Congressman.
        Mr. LaMalfa. I appreciate it. And in my experience, your
    airport also has been very good as I take the red eye from the
    coast and end up there about 6 a.m. sometimes, but it is always
    a nice facility to be with. Just the line at Popeyes is always
    too long at 6 a.m. there.
        Mr. Reed. That is the busiest Popeyes Chicken in the world,
    by the way.
        Mr. LaMalfa. Thank you, sir.
        I yield back.
        Mr. Graves of Missouri. Mrs. Napolitano.
        Mrs. Napolitano. Thank you, Mr. Chair.
        Mr. Thomas, I have a question in regard to Capital
    Investment Grants. The Trump administration's skinny budget
    calls for elimination of Capital Investment Grants or the New
    Starts. DART has two separate projects in this pipeline. Do you
    think it makes fiscal sense to eliminate an infrastructure
    program that has 55 projects from across the country in the
    planning engineer stage, potentially sending back billions of
    dollars of infrastructure investment?
        Mr. Thomas. Certainly across the United States,
    Congresswoman, there has been a lot of work done in preparation
    of these projects. A lot of these projects, as they are in
    Dallas, have gone through extensive community meetings, lots of
    planning efforts, lots of coordination. And certainly in our
    case, we are bringing a significant amount of money to the
    table, as we always have, as we will continue to do in our
    financial plan.
        And people have looked at the FAST Act as--that although it
    only goes to 2020, and we understand there are challenges
    beyond that, we are certainly appreciative of the long-term
    bill. We would like for it to stay intact and for it to
    continue to move forward through 2020. So these agencies,
    including ours, that have anticipated that funding can go ahead
    and get these projects completed and provide those choices to
    people----
        Mrs. Napolitano. Yes, but does it make fiscal sense to
    eliminate them?
        Mr. Thomas. Certainly in DART's case, no, ma'am, it does
    not, because we are bringing money to the table. They are
    getting 50 cents on the dollar for a project. So it seems like
    it makes a whole lot of sense to continue to do that.
        Mrs. Napolitano. Thank you. Another question I have has to
    do with Positive Train Control. The FAST Act provided $199
    million guaranteed for the Mass Transit Account of the Highway
    Trust Fund for fiscal year 2017, to help commuter railroads
    implement PTC. The Appropriations Committee, our very own, did
    not make the funding available, however, under the continuing
    resolution. This critical safety funding will lapse if the CR
    is extended for the remainder of this fiscal year.
        Mr. Patterson and Mr. Thomas, can you elaborate why this
    funding is important to your agencies?
        Mr. Thomas. Well, certainly the transit industry is hopeful
    that Congress will quickly complete the fiscal year 2017 budget
    so that that $199 million of grant funding can be allocated to
    the properties throughout the country. We have got a 2018
    deadline for our commuter rail system to put that in place.
    That requirement comes on top of operating and maintaining our
    system every day. So it is imperative that----
        Mrs. Napolitano. It has already been extended once.
        Mr. Thomas. Yes, ma'am. And so it is imperative to meet the
    2018 deadline to get that funding in place so we can get that
    critical safety project completed.
        Mrs. Napolitano. Thank you.
        A question primarily for Mr. Patterson and Mr. Reed--Mayor
    Reed. I have been working on an amendment to FAA
    reauthorization to prohibit FAA from impacting State and local
    general sales tax. The issue: For 30 years, FAA has required
    excise tax on aviation fuels to be spent on airports for
    airport infrastructure, but for 30 years, the FAA has not
    interpreted this requirement to affect general sales tax, which
    tax aviation fuel as well as other products sold in the country
    or the State. Now they are changing their interpretation,
    requiring State and local governments to count how much money
    is collected by the general sales tax on aviation fuel and
    siphoning the money back to the airport.
        A major Federal business problem when State and local
    governments are being told how to spend their own tax dollars
    by the FAA. It will impact local transportation projects, since
    most sales tax around the country provide for local
    transportation funding.
        The Hartsfield-Jackson Atlanta International Airport in the
    State of Georgia is one of the most impacted regions in the
    country with the new rule. It will take millions of dollars out
    of local control, a major problem in my State of California.
    Are you aware of the issue and do you have concerns with this
    new FAA rule? Should Congress fix and return 30 years of
    precedence that allows State and local governments to spend
    their general tax revenue as they see fit?
        Mr. Patterson. I don't have any knowledge. I have
    knowledge, but I can't really comment on that. I think the
    mayor would be better suited for this answer.
        Mr. Reed. Congresswoman, I am on your side. And I don't
    think I could have said it better than you just said it.
        Mrs. Napolitano. Well, it is an infringement upon the local
    control, as far as I am concerned.
        Thank you, Mr. Chair, I yield back.
        Mr. Graves of Missouri. Mr. Smucker.
        Mr. Smucker. Thank you, Mr. Chairman.
        As a business owner of a construction company for 25 years
    prior to serving in the State legislature and then here, I
    understand the importance of a good highway/bridge system with
    infrastructure to move goods and employees to job sites, and
    the importance of infrastructure to our economy, essentially.
        And then when serving in the State legislature, we were one
    of those States that were able to pass a bill that provided for
    additional sustainable funding for our highway and bridge
    system. In our case, it was a wholesale gas tax that had a cap
    on it tied to the price of gas. We essentially lifted the cap.
    But generated billions of dollars of additional funding, mostly
    for maintenance and repair of our current system, in some
    cases, adding additional capacity. But we had the highest
    number of structurally deficient bridges of any State, I
    believe, at the time, and there was a real need.
        But the reason I bring that up--and, Mayor Reed, maybe this
    question will be directed to you--it was really important for
    us--let me back up. So it was a Republican legislature, both
    Houses, and a Republican Governor at the time. And I just
    mention that because you mentioned that in Georgia, but also
    mention it because at the same time that we were able to gather
    support for that, we were looking at all aspects of our budget.
    And, in fact, were cutting back in other areas, because we
    really believed that we needed to focus on the core functions
    of Government, and were able to make the case to the people of
    Pennsylvania that infrastructure is not only a core function of
    Government. It is something you have to do at that level, but
    also was critically important to people who were caught in
    traffic, in congestion, and critically important to the
    economy.
        And it took a concerted effort, it took a lot of hearings,
    it took a lot of discussion with the public to gain that
    support that was required to pass that. And I think that is
    something that we will need to do here. And I support finding a
    way for sustainable funding. I think the point was brought up
    earlier, it is so important to not only the States and local
    municipalities to have that dependable, sustainable source of
    funding, but to all of the businesses that rely on this. It is
    critical for efficient delivery to know we can plan ahead.
        So, Mayor, I guess a question to you: Can you give us some
    insight? I think, if I understood your testimony correctly,
    while you were there, you essentially passed a 1-percent sales
    tax that went to infrastructure. And you said also Georgia was
    doing that at the same time. What can we learn from that in
    terms of building the public support for investment in our
    infrastructure?
        Mr. Reed. Congressman, I think what we can learn is that
    the public is ahead of us. And I think that when we talk
    plainly and explain what the challenges are, the public will
    come on board as long as they believe that we are going to make
    good use of their funds. I imagine you experienced that in
    Pennsylvania.
        In Georgia, our State is one of eight States in America
    with a AAA credit rating from all three rating agencies. One of
    the reasons is tight fiscal management, but also the decision
    that we made around transportation. We have grown to be the
    10th largest State in the Union. The Atlanta metropolitan
    region is now the ninth largest metro in the country, with a
    GDP of $335 billion. And we have gone from a really low credit
    rating to AA plus, from Standard and Poor's, Moody's, and
    Fitch. So I think the arguments that you make is--and we have
    had an absolute jobs boom.
        And what we are all concerned about is who is going to win
    the war for talent. And I think that folks like you and I have
    to just get out and make the case. And I thought it was really
    important that a Republican Governor, Republican House, and
    Republican Senate passed $1 billion for transportation, because
    our folks were stuck in traffic like you all. And then on the
    transit side, we are doing the biggest transit expansion in the
    history of our system. And it will be one of the seventh
    largest transit expansions in America, but we did it with 71
    percent voter support at the ballot. I think that was a nice
    bipartisan collaboration.
        Mr. Smucker. Thank you. I was hoping to get input from the
    other panelists as well, but I see that I am out of time.
        Mr. Reed. I apologize. Thank you for the question.
        Mr. Smucker. Thank you.
        Mr. Graves of Missouri. Mr. Johnson.
        Mr. Johnson of Georgia. Thank you, Mr. Chairman.
        Mayor Reed, you served in the Georgia Legislature for 10
    years, both in the House and Senate. And so you know how
    conservative and fiscally restrained the environment is among
    our legislative friends in Georgia. But yet, back in 2015,
    Georgia increased its gas tax from 7.5 cents to 26 cents, and
    increased the diesel tax to 29 cents, and then indexed it so
    that every year it is adjusted in accordance with the Consumer
    Price Index.
        Can you comment about the conditions that existed in
    Georgia that led to the passage of that gas tax increase? And
    also, what political fallout, if any, occurred as a result of
    passage, and then the benefits from passing that increase?
        Mr. Reed. Thank you for the question, Congressman. I think
    the bottom line is that if you want to lose an election in
    Georgia, you would be the person to lose the State's AAA credit
    rating. And I think that everybody acknowledged--everybody was
    experiencing the same thing. We were all sitting in traffic. We
    had tried to pass a regional bill. You remember that. The
    Governor and I worked to pass a regional transportation bill
    that was soundly rejected by the voters at the ballot.
        So the problem of traffic in Atlanta--we have among the
    worst traffic in the United States--it was really starting to
    impact our ability to attract jobs and business when we were
    trying to fight our way out of the recession. And every meeting
    that the Governor and I went to when we were recruiting
    businesses and working to keep businesses in Georgia, they
    said, you have to do something about the traffic.
        And so I think that it was a matter of having the right
    leader at the right time. He made the decision to move a bill
    through the Georgia General Assembly. And I am comfortable
    saying that 95 percent of the people who voted in favor of the
    $1 billion tax increase were all reelected. I would probably be
    comfortable saying 98 percent were reelected at the ballot. So
    the risks were minimal, but we did do a very good job of
    explaining the need. And then the city took the leadership on
    expanding transit within the city of Atlanta.
        Mr. Johnson of Georgia. Well, I want to ask you about that,
    because Atlanta has seen a number of Fortune 500 and Fortune
    100 companies moving into Atlanta as a result of our investment
    in transit. Can you elaborate on what we have done, how it has
    affected our economy?
        Mr. Reed. Sure, Congressman. We have the third largest
    concentration of Fortune 500 businesses in the United States of
    America. And I think what the business community is doing is
    depoliticizing transit, as opposed to it being a Democrat/
    Republican issue. When State Farm sited 8,000 jobs outside of
    Atlanta in Dunwoody, they wanted it by a MARTA stop. When
    PulteGroup Homes moved their headquarters to Atlanta--it is the
    second biggest home builder in America--they wanted it by a
    MARTA stop.
        So what we are seeing is the business community and
    millennials want to be near transit. And so it is lifting the
    transit conversation out of urban/rural politics, because
    everybody wants terrific jobs. And we have a generation of
    folks, unlike my generation and your generation, who are not
    interested in driving automobiles. And so, if you want to be
    first to the future, you will have to be in the transit
    business. And so Republicans and Democrats have gotten in line.
        And I would suspect that Mr. Thomas sees the same thing.
    When you put down transit and infrastructure, business comes to
    it, because it is a permanent investment. And when you put it
    to voters, these items pass overwhelmingly. So I think it is
    really about being first to the future, Congressman. And you
    just have to decide whether you want to have well-paying jobs
    for your people or not. And, now, because of the business
    community's insistence on transit, and how well transit
    investments perform in terms of the economy that is built
    around it, it is helping us get out of this old argument of
    rural/urban, Democrat/Republican.
        Mr. Johnson of Georgia. Mr. Thomas, have you experienced
    the same thing in Dallas?
        Mr. Thomas. Absolutely. And as in Atlanta, we have a State
    Farm development also. And they did the same thing; they looked
    for a rail station to be close to. And the development around
    that particular station is phenomenal: 28 new restaurants,
    thousands of new residences, millions of square feet of office
    space that occur around that particular station. So the
    developers certainly understand the advantage of that
    transportation infrastructure they are looking at. Our
    communities understand it.
        The debate in north Texas is where our resources, where
    those Federal resources end up going, because they know that
    when we go in and build that infrastructure, there is going to
    be development; there is going to be job opportunities; there
    are going to be the benefit to the people, not only from a
    transportation perspective, but also, all the ancillary
    benefits that happen around those stations.
        Mr. Johnson of Georgia. Thank you. I am out of time. I
    yield back.
        Mr. Graves of Missouri. Mr. Shuster.
        Mr. Shuster. Thank you, Mr. Chairman.
        Once again, I want to thank you and welcome all of you to
    the committee. I appreciate your testimony.
        I am going to yield my time to Mr. LaMalfa, Doug, as we
    call him here, my time, because he has some more questions he
    would like to ask.
        So, with that, I yield.
        Mr. LaMalfa. Much appreciated, Mr. Chairman.
        Again, I appreciate the discussion with the panel. And, Mr.
    Mayor, you know, you talk about the collaborative process you
    had in Georgia there with the Governor of your city and others
    where, you know, the AAA credit rating. You are doing things
    the right way. You are talking to people and they are
    expressing what it is they wish to see happening.
        Right now in California, where we don't have a good credit
    rating, the legislature, I think really in more--well, total
    control terms, I will leave it at that--are forcing through at
    this moment, this week, a combined gas tax and car tax, which
    the people are against, especially in terms of--and I am going
    to direct a question to Mr. Patterson here in a moment. But we
    have a high-speed rail issue in California that is shown to be
    $55 billion short of funding, and we don't know where it is
    going to come from, yet we have crumbling bridges and roads
    down there that the people are going to be forced to pay a
    higher tax on their automobile registration and their gasoline.
    That is probably going to mean to a two-car middle income
    family around $500 per year additionally that they don't get to
    spend on their kids' education or whatever, for crumbling roads
    and bridges that, instead, they are seeing billions and
    billions being spent on high-speed rail at a point where nobody
    in the State other than people that make money off it seem to
    want it.
        And then, the audacity that in this new funding that would
    come from this new tax, there are not even any upgrades for new
    additional lanes or additional capacity for roads and bridges.
        So I think what is going on out there is not a
    collaborative process and it is really tone-deaf to what the
    needs of middle income families are. So I would like to see,
    where we can do it here, a much more streamlined process to get
    dollars to projects that do relieve traffic and do repairs.
        So for Mr. Patterson, you know, again, in my own county up
    there in Butte County, we have State Highway 70 that could have
    been done. There are projects that could be done in the future
    or that have already been partially done faster and less costly
    if the environmental review process didn't have to take nearly
    as long for issues environmentally that are already well-known.
    This isn't a brand new concept here that we add a lane on the
    next segment that you are going to, you know, have issues that
    are already well-known on previous studies in the same type of
    terrain.
        So what can we be doing to assist local agencies without
    having to be held hostage for some of these habitat tradeoffs,
    to have more efficient construction of transportation projects,
    whether it is rebuilding of, you know, older infrastructure or
    the additional capacity we all want and we all need as
    taxpayers?
        Mr. Patterson. Thank you, Congressman. One of the things
    that this Congress did was provide for a better process when we
    are talking about, in your example, adding lanes to or adding
    additional capacity to already identified transportation
    corridors. And the intent of Congress at the time was to go
    from fence to fence, and that would be because it is already
    cleared as a transportation corridor.
        Some of the guidelines that we have received from the
    Federal Highway Administration don't allow fence to fence, and
    so that is just pavement edge to pavement edge. And so we are
    having to work through some of those issues with the U.S. DOT
    and their rulemaking process. And I know the director in
    California, Malcolm Dougherty, is working very hard on that
    issue, as well as many other of my colleagues from around the
    country.
        Mr. LaMalfa. Thank you for that. I would like to look more
    into that fence-to-fence provision you are talking about there,
    but I will I yield back the rest of my time. And please follow
    up with my office if you get the opportunity on that. Thank
    you.
        Mr. Patterson. Yes, sir.
        Mr. Graves of Missouri. Ms. Titus.
        Ms. Titus. Thank you, Mr. Chairman.
        We heard earlier Chairman Shuster mentioned something about
    45 Members had a meeting with Secretary Chao. I would suggest
    that we invite her to meet with all members of this committee,
    so we can have a collaborative effort and continue to be
    bipartisan in our effort to put forward transportation policy.
    Maybe then they wouldn't have the problems that they had with
    the healthcare bill if we were all engaged from the beginning.
    So I would just make that suggestion.
        Also, I would like to acknowledge--and he is gone already--
    but Mr. Davis from Illinois. He brought out our bill that we
    worked together on and became an amendment to the FAST Act,
    where we send more money to the local government as opposed to
    the State for it to be distributed. I think we need to continue
    down that path, because too often, the politics in the State
    capital around the DOT entities play a bigger part than good
    policy decisions. So the more we can send money to the local
    government, I think the better.
        I would like to turn my attention a little bit, though, to
    another provision in the FAST Act that I worked on, and that
    was to have Complete Streets planning put into the bill. This
    is the first time this has ever been done in a Federal
    transportation program. I was very glad to see that in my
    district in Las Vegas. We have just had an increase in
    pedestrian deaths. And, so, having a policy that begins with
    the planning through the construction through the operation of
    transportation that includes all users, I think is very
    beneficial.
        I know a number of States and local governments are
    incorporating that kind of Safe Streets planning. And I would
    like to ask you, Mayor Reed, under your leadership, I know
    Atlanta is kind of one of the stars in this area. Could you
    comment on the benefits of it, how it is working, some
    suggestions for other places to follow?
        Mr. Reed. I think that it has worked well, and I think that
    it is connecting communities and contributing to a sense of
    community that the people that created and developed the
    concept had in mind. It is what we thought it would be when
    well-executed. And so it is an approach that we are taking. It
    is a part of the reason that we had such success at the ballot
    when we went to voters for the four basis points for four-
    tenths of a penny during our recent referendum. Folks are
    asking for it. And it also gives a significant boost to
    businesses that are on Complete Streets corridors.
        And, so, I think that the Complete Street approach is
    really bearing good fruit, and it is what we thought it was.
    And it needs to be pushed at every opportunity if you want your
    city or your community to be a leading one, because it is
    something people want when they are looking for a place to make
    a permanent home.
        Ms. Titus. Thank you. I believe it is not just for safety,
    but quality of life. You see more people on bicycles now, more
    people walking, all kinds of uses besides just cars and buses.
        Mr. Patterson, would you talk about what some of the States
    are doing as they include this in their planning?
        Mr. Patterson. Well, I know several States are working on
    Complete Streets. In Oklahoma, we are partnering with the city
    of Oklahoma City for a new downtown boulevard that includes
    bike lanes, pedestrian paths, as well as a new driving lane. It
    is where I-40 used to go through downtown Oklahoma City, and we
    relocated I-40 to the south of downtown, and we are putting in
    a boulevard that has the Complete Streets concept to it.
        Ms. Titus. And if you want to talk about businesses, we are
    seeing in downtown Las Vegas where they now have rent-a-bikes,
    and that is kind of part of that quality of living I was
    talking about. Would you like to comment on how it relates to
    businesses and improves that aspect of things, anybody?
        Mr. Patterson. I can tell you in Oklahoma City, we have the
    rent-a-bike program going on there, and it is growing
    exponentially. We believe that once the new boulevard is in
    place, it will explode, much like you see here in Washington,
    DC.
        Ms. Titus. Mayor?
        Mr. Reed. Our Bikeshare program has been highly popular,
    and we are getting ready to expand it by 400 percent.
        Mr. Thomas. Congresswoman, I think the benefit--and you
    certainly are aware--is how all of the different modes of
    transportation work together in a single corridor, whether it
    be buses, bikes, pedestrians, automobiles. And that planning
    effort is what makes all that happen. And so often, the
    planning effort is skipped and bypassed. So thank you very much
    for making sure that it has been included in the FAST Act.
        Ms. Titus. Thank you. I yield back.
        Mr. Graves of Missouri. Mr. Lowenthal.
        Mr. Lowenthal. Thank you, Mr. Chairman. And I join others
    in thanking our witnesses for joining us and educating us
    today.
        I would like to raise an issue that is near and dear to my
    heart and extremely important to my district, which is the 47th
    Congressional District, which starts off with the Port of Long
    Beach, which is the second largest port in the United States.
    And that is freight funding, the funding for the movement of
    freight. As you know and have mentioned, the FAST Act included
    dedicated freight funding programs for the first time. This
    included a competitive grant program dubbed FASTLANE by DOT.
        Mayor Reed, you have talked about the importance to your
    State and the city of economic development at the Port of
    Savannah, which received a $44 million grant for multimodal
    connectors, such as you have talked about.
        Mr. Patterson, your department was granted $62 million last
    year for U.S. 69, U.S. 75, for rail grade separations. So your
    organization, AASHTO, also put out a report with the American
    Association of Port Authorities that showed the growing demand
    for multimodal projects. The report stated that an absolute
    minimum need of at least $20 billion for multimodal projects.
    Yet, the FAST Act only has a total funding for multimodal
    projects of slightly more than $1 billion, $1.13 billion, and
    that is over 5 years.
        The question I have for you is, do you agree that there is
    a greater need for funding of multimodal projects?
        Mr. Patterson. Congressman, absolutely. One of the things
    that we know, AASHTO knows, is that as we have looked at the
    Federal program over the years, since the completion of the
    Interstate Highway System, we really don't have a goal,
    something to hang our hat on, if you will. We were hoping, and
    we believe, that this freight program is the next goal. It is
    imperative that we be able to move freight across this country,
    by rail, water.
        Mr. Lowenthal. I think you are doing it great. I just want
    to ask, because I have one more followup question and that is
    exactly what I wanted. Do you have anything more to add, for
    example, Mayor Reed? Do you believe it is imperative?
        Mr. Reed. The answer is absolutely.
        Mr. Lowenthal. OK. Now, I have a proposal that I first
    introduced in the 114th Congress, will be doing again, that
    puts a user fee, which is paid for by the owners of the goods,
    on the cost of shipping goods by road or rail in the United
    States to directly fund freight infrastructure. So a user fee
    paid by the owners of the goods to directly fund freight
    infrastructure.
        Maybe not this one, but would you support a similar
    proposal such as a user fee by the owners of goods to pay for
    freight infrastructure?
        Mr. Patterson. Several years ago, a group of us at AASHTO
    got together and we were looking at ways to fund transportation
    in the future. Congressman, that is exactly one of the things
    that we had come up with was an additional surcharge and user
    fee, however you would want to label it, for freight movements
    and dedicated to a freight system.
        Mr. Lowenthal. So it has to be dedicated. It would be
    sustainable paid by the users. It would be a dedicated funding
    stream to be used just for freight infrastructure.
        Would you support that, Mayor Reed?
        Mr. Reed. I don't know. I would have to have the full
    proposal to consider it.
        Mr. Lowenthal. OK. We are just talking about not so much a
    specific proposal, but just the concept that those who use the
    system would pay for the improvements in the system, dedicated,
    and some way to get both back to--you know, an appropriate way
    of distributing that fund.
        Mr. Patterson. Yes.
        Mr. Lowenthal. Thank you. And I yield back.
        Mr. Graves of Missouri. Mr. Lipinski.
        Mr. Lipinski. Thank you, Mr. Chairman.
        I thank all of our witnesses for being here today. As we
    talk about the FAST Act, which I want to thank all the members
    of this committee on both sides, the chairman of the
    subcommittee, the chairman of the full committee, Mr. Shuster,
    our Ranking Member Norton, and Ranking Member DeFazio. We all
    worked well together in getting the FAST Act together and
    moved. I am hopeful that we can do the same thing on a new big
    $1 trillion or more than $1 trillion infrastructure plan.
    Things that have been talked about by the last few people,
    Members who have spoken, about Complete Streets, about transit,
    I think it is important that those are included in a new
    infrastructure package. The importance of freight movement that
    Mr. Lowenthal was just talking about, I think that is also very
    critical to do.
        I want to ask a question about something that I don't think
    anyone has yet asked about at this hearing about vehicle to
    infrastructure, or V2I technology and getting that into our
    infrastructure.
        So not only V2V, vehicle to vehicle, but V2I technology is
    vital for maximizing the benefits of autonomous and connected
    vehicles, you know, benefits such as brake safety improvements,
    less congestion on our roads, and also increasing the
    efficiency of our vehicles.
        So we really need to find creative ways to incentivize
    investment in vehicle infrastructure technology. We need to
    make targeted investments that best leverage capital,
    especially if we are going to be doing this big infrastructure
    package. Now, the FAST Act ensured that V2I infrastructure
    would remain eligible for funding, but we also need to consider
    Dig Once policies that promote installation of advanced systems
    that enable V2I during routine construction and maintenance
    projects, so we are not going back and doing it all over again.
        I have asked witnesses at previous hearings about the state
    of local--about State and local investments in this technology.
    And some have said that they have been hesitant to make
    investments, because of the lack of both industry standards and
    Federal guidance. In January, FHWA released a new V2I guidance
    document that can help transportation agencies understand the
    regional impacts of V2I deployment, prepare for emerging V2I
    and V2V technologies, and leverage Federal aid funds to deploy
    them.
        So after a long lead-up, I would just like to ask Mr.
    Patterson and Mr. Reed if you could discuss your experience
    with V2I technology, and whether or not there is sufficient
    Federal guidance to promote investments and what more can be
    done, so we make sure that we do prepare the infrastructure for
    this? Mr. Patterson, do you want to start?
        Mr. Patterson. Thank you, Congressman. I think, from an
    overall perspective and given the advances in technology, it
    has been good that the States have taken a slow methodical
    approach to integrating V2I into the system. When you look at--
    technology doubles every year, and you look back 5 years ago
    when we really got into the discussion about V2I, it has
    changed. The guidance that came out is very helpful. We have
    several of our members who are very involved in leading the
    technology. I can tell you in Oklahoma, we are still learning.
    We are not as far advanced as some other States are in the
    discussion, but it is something we are beginning to understand
    and embrace. And it was that guidance and it is the support of
    AASHTO members that gets us to that point.
        Mr. Lipinski. And, Mayor Reed, do you have anything to add?
        Mr. Reed. Congressman, we are developing a Smart Corridor
    along North Avenue near Georgia Tech and by the Coca-Cola
    Company that will be really testing all of these technologies
    at once. So, much like my colleague, we are in the very early
    stages of it. Candidly, we have been putting a great deal more
    energy into self-driven vehicle technology and we have been
    slower on V2I.
        Mr. Lipinski. Is there anything the Federal Government can
    do to help to speed things along, make it easier for States and
    localities to do this?
        Mr. Reed. I think that rules of the road from Federal
    experts could shorten the learning curve for municipalities,
    because that is really the challenge for us. When these new
    kinds of technologies and relationships occur, we have to come
    up to speed on that and we have to put in a good amount of
    person power for that. So knowing where the Federal Government
    is going in the future in that regard would send an important
    signal to where we should be going.
        Mr. Patterson. I think that collaboration and cooperation
    is going to be very important, as the mayor said, as we begin
    to develop our system in Oklahoma and as other States expand
    their V2I capabilities. If you think about it, this is really a
    turning point for all of transportation. It is almost as
    extensive as going from the horse and buggy to the Model T. So
    it is something that we are very interested in and our
    customers, the public, is going to demand that kind of reaction
    from us.
        Mr. Lipinski. Thank you. I yield back.
        Mr. Graves of Missouri. Any other further questions?
        Seeing none, I would like to obviously thank our witnesses
    for your testimony today, because your contribution to today's
    discussion, it has obviously been very informative and very
    helpful.
        With that, I would ask unanimous consent that the record of
    today's hearing remain open until such time as our witnesses
    have provided any answers to any questions that may be
    submitted to them in writing; and unanimous consent that the
    record remain open for 15 days for additional comments and
    information submitted by Members or witnesses, to be included
    in the record of today's hearing.
        Without objection, that is so ordered.
        And if no other Members have anything to add, then the
    subcommittee stands adjourned. Thank you all.
        [Whereupon, at 12:05 p.m., the subcommittee was adjourned.]

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