Surface Transportation: Research Funding, Federal Role, and Emerging
Issues (Chapter Report, 09/06/96, GAO/RCED-96-233).

Pursuant to a congressional request, GAO provided information on surface
transportation research, focusing on: (1) public and private funding for
surface transportation research; (2) the transportation community's
views on such research and the Department of Transportation's (DOT)
ability to fulfill that role; and (3) issues that the transportation
community believes that Congress and DOT should address during the
reauthorization of the Intermodal Surface Transportation Efficiency Act
of 1991 (ISTEA).

GAO found that: (1) between fiscal years 1992 and 1996, DOT provided
$2.9 billion for surface transportation research programs to five modal
agencies, with the Federal Highway Administration (FHwA) receiving $2.1
billion; (2) FHwA allocated almost half of its funding to its
Intelligent Transportation Systems Program, and other agencies conducted
research on vehicle and driver safety, high-speed ground transportation,
mass transit operations, and advanced transportation technologies; (3)
ISTEA has encouraged greater public and private cooperation as well as
university involvement, and states have increased the amount of federal
and state money they spend on such research; (4) the transportation
community generally agreed that DOT should lead the nation's surface
transportation research program and serve as a focal point for
technology transfer, since it has broader interests and a wider
perspective than the other parties; (5) DOT has improved external and
internal coordination of its surface transportation research program,
but lacks the resources and authority to create an integrated framework
or strategic plan for surface transportation research; and (6) the
transportation community believes that the surface transportation
research program does not adequately address the total surface
transportation system, giving limited attention to system assessment,
policy, and intermodal research, and does not include enough basic,
long-term, high-risk research to respond to complex, persistent
problems.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-96-233
     TITLE:  Surface Transportation: Research Funding, Federal Role, and 
             Emerging Issues
      DATE:  09/06/96
   SUBJECT:  Ground transportation operations
             Transportation research
             Highway research
             Research program management
             Federal aid for transportation
             Transportation industry
             Agency missions
             Interagency relations
IDENTIFIER:  DOT Intelligent Transportation System Program
             FRA Next Generation High Speed Rail Development Program
             FTA Transit Cooperative Research Program
             RSPA Research Management and Application Program
             DOT Surface Transportation Research and Development Plan
             
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Cover
================================================================ COVER


Report to Congressional Committees

September 1996

SURFACE TRANSPORTATION - RESEARCH
FUNDING, FEDERAL ROLE, AND
EMERGING ISSUES

GAO/RCED-96-233

Surface Transportation Research

(342904)


Abbreviations
=============================================================== ABBREV

  AASHTO - American Association of State Highway and Transportation
     Officials
  DOD - Department of Defense
  DOT - Department of Transportation
  FHWA - Federal Highway Administration
  FRA - Federal Railroad Administration
  FTA - Federal Transit Administration
  ISTEA - Intermodal Surface Transportation Efficiency Act of 1991
  ITS - Intelligent Transportation Systems program
  MPO - Metropolitan Planning Organization
  NHTSA - National Highway Traffic Safety Administration
  NSTC - National Science and Technology Council
  RSPA - Research and Special Programs Administration

Letter
=============================================================== LETTER


B-265718

September 6, 1996

The Honorable John H.  Chafee
Chairman
The Honorable Max S.  Baucus
Ranking Minority Member
Committee on Environment and
 Public Works
United States Senate

The Honorable John W.  Warner
Chairman, Subcommittee on
 Transportation and Infrastructure
Committee on Environment and
 Public Works
United States Senate

In response to your request, this report provides information on (1)
the public and private funding for surface transportation research,
(2) the transportation community's views on the federal role for such
research and the Department of Transportation's ability to fulfill
that role, and (3) the issues that the transportation community
believes the Congress and the Department should consider during the
reauthorization of the Intermodal Surface Transportation Efficiency
Act of 1991. 

We are sending copies of this report to interested congressional
committees and the Secretary of Transportation.  We will also make
copies available to others upon request. 

If you or your staff have any questions, I can be reached at (202)
512-2834.  Major contributors to this report are listed in appendix
II. 

John H.  Anderson, Jr.
Director, Transportation and
 Telecommunications Issues


EXECUTIVE SUMMARY
============================================================ Chapter 0


   PURPOSE
---------------------------------------------------------- Chapter 0:1

Spending on passenger and freight transportation exceeds $1 trillion
annually, representing about 11 percent of the nation's gross
domestic product.  Decisions about surface transportation research
have significant consequences because research provides the
knowledge, products, and technologies needed to make transportation
more efficient, effective, and safe. 

To prepare for reauthorizing the Intermodal Surface Transportation
Efficiency Act of 1991 (ISTEA), the Chairman and Ranking Minority
Member, Senate Committee on Environment and Public Works, and the
Chairman of that Committee's Subcommittee on Transportation and
Infrastructure asked GAO to provide information on the Department of
Transportation's surface transportation research programs.  This
report discusses (1) the public and private funding for surface
transportation research, (2) the transportation community's views on
the federal role in surface transportation research and the
Department's ability to fulfill that role, and (3) the issues that
the transportation community believes the Congress and the Department
should consider during ISTEA's reauthorization. 


   BACKGROUND
---------------------------------------------------------- Chapter 0:2

ISTEA called for a new direction in surface transportation research,
specifying new research initiatives, such as the Intelligent
Transportation Systems program, and providing increased funding for
research.  ISTEA found that despite an annual federal expenditure of
more than $10 billion on surface transportation and its
infrastructure, the federal government lacked two key components of
an effective research program:  (1) a clear vision of the role of
federally funded surface transportation research and (2) an
integrated framework for the fragmented surface transportation
research programs dispersed throughout the government. 

Surface transportation and its research spans three distinct
modes--highways, mass transit, and railroads.  It also includes
issues such as safety and the connections between modes.  Within the
Department, five modal agencies sponsor surface transportation
research, which includes basic and applied research, development,
demonstration, and technology transfer. 


   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

Since ISTEA's enactment, the federal funding for surface
transportation research has reached nearly $2.9 billion (from fiscal
year 1992 through fiscal year 1996).  Most of this funding has gone
to the Federal Highway Administration (FHWA), which received $2.1
billion.  Within FHWA, one program, Intelligent Transportation
Systems, has received about half of the funding--$1.01 billion.  This
program uses research in computer and information technology to
improve highway capacity and safety.  State spending on surface
transportation research has increased but is relatively small
compared with the federal investment.  Information on industry's
total funding for surface transportation research is proprietary and
therefore limited. 

Representatives of the transportation community--from the federal
government, state governments, industry, and academia--agreed that
the Department should act as the leader in surface transportation
research by funding research, establishing an overall research
mission with objectives for accomplishment and priorities for
allocating funds, and acting as a focal point for technology
transfer.  The Department has established councils and committees to
coordinate its research, but its modal organization and lack of both
a strategic plan and a departmental focal point, as well as
congressional directives to initiate or maintain specific research
efforts, may limit its leadership.  Until these issues are addressed,
the Department may not be able to respond to ISTEA's call for an
integrated framework for surface transportation research. 

According to representatives of the transportation community, federal
surface transportation research currently does not adequately address
two areas that will grow more important with time.  First, it does
not adequately focus on the total surface transportation system,
giving limited attention to system assessment, policy, and intermodal
research.  Second, it does not include enough basic, long-term,
high-risk research to address complex, persistent problems such as
congestion.  Federal decisions about the surface transportation
research portfolio will be important during the reauthorization of
ISTEA's research programs. 


   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4


      FUNDING FOR HIGHWAY-RELATED
      RESEARCH DOMINATES THE
      SURFACE TRANSPORTATION
      AGENDA
-------------------------------------------------------- Chapter 0:4.1

From fiscal year 1992 through fiscal year 1996, the Department
provided $2.9 billion for surface transportation research programs. 
This total represents about 2 percent of the Department's total
budget for surface transportation programs.  About $2.1 billion went
to FHWA, which allocated nearly half of the funds for the Intelligent
Transportation Systems program's projects.  FHWA also supports
research on communications technologies, construction practices, and
building materials to improve highway safety.  The Department's other
modal agencies sponsor research on vehicle and driver safety,
high-speed ground transportation, mass transit operations and
maintenance, and advanced transportation technologies.  According to
the American Association of State Highway and Transportation
Officials, the states increased the federal-aid highway dollars they
spent on research from $53 million in 1989 to $88 million in 1995. 
During the same period, they increased their own funding for research
from $33 million to $76 million.  Although information on the private
sector's funding is proprietary and therefore limited, the
Transportation Research Board reported that highway associations
spent about $21 million on highway research in 1993.  Meanwhile, the
Association of American Railroads spent $26 million for rail research
in 1994. 


      DESPITE AGREEMENT ON FEDERAL
      ROLE, LIMITATIONS EXIST
-------------------------------------------------------- Chapter 0:4.2

Members of the transportation community generally agreed that the
federal government should lead the nation's surface transportation
research.  They pointed out that federal expenditures on research are
important and that the Department has broader interests than other
parties:  The states generally focus on applied research to solve
specific problems; industry funds research to develop new or expanded
markets; and universities train future transportation specialists and
conduct research that reflects the interests of their funders. 

In 1993, the Secretary formed the Coordinating Committee for
Transportation Research and Development under the President's
National Science and Technology Council, created the position of
Director of Technology Deployment within the Office of the Secretary,
and established the Research and Technology Steering Committee and
Coordinating Council.  The Department made these changes to improve
the external and internal coordination of its surface transportation
research program. 

While improving coordination, these actions have not removed the
organizational constraints on the Department's development of a more
strategic approach to research.  Surface transportation research
within the Department is focused on improving individual modes of
transportation rather than on creating an integrated framework for
surface transportation research.  Such a framework might establish
objectives and strategies for accomplishing them, including
establishing priorities for the use of limited funds. 

Unlike the Department of Defense, the Department of Transportation
does not have an Assistant Secretary for Research and Development to
oversee its research.  The Director of Technology Deployment, within
the Office of the Secretary, formerly served as a focal point for
coordinating research, but that position is now vacant.  (On August
21, 1996, however, the Department announced that the Research and
Special Programs Administration's Associate Administrator for
Research, Technology, and Training would assume the Director's
coordinating functions on an interim basis.) Although the Research
and Special Programs Administration was established to foster
cross-cutting research, it lacks the resources and authority to act
as the Department's strategic planner for surface transportation
research. 

Congressional directives also limit the Department's ability to guide
research.  For example, officials in one modal agency found that the
Congress had specified how the agency was to spend nearly 80 percent
of the budget for one of its primary research programs in fiscal year
1996. 

The Department is attempting to develop an integrated framework for
surface transportation research.  Its annual research and development
plans are useful inventories of the five modal agencies' research
activities.  However, the plans cannot be used, as ISTEA directed, to
make surface transportation research more strategic, integrated, and
focused. 


      INVESTMENT IN EMERGING AREAS
      AND BASIC RESEARCH IS NOT
      ADEQUATELY ADDRESSED
-------------------------------------------------------- Chapter 0:4.3

According to public and private transportation officials, the current
investment in surface transportation research is inadequate to build
knowledge, either in three emerging areas--system assessment, policy
research, and intermodal research--or in basic, long-term, high-risk
research. 

System assessment research seeks a comprehensive understanding of the
transportation system's parts and their interrelationships.  It also
allows for a comprehensive examination of persistent problems, such
as congestion, which costs the nation an estimated $40 billion
annually in lost time and wages. 

Transportation officials cited policy research as a high priority for
the federal government, as well as for state and local governments
faced with complex transportation problems.  For example, ISTEA
required local planning agencies to conform transportation plans to
air quality goals.  However, few standard models for assessing the
impact of transportation on air quality are available for local
agencies to use. 

Transportation officials also said that intermodal research--on how
people and freight move between highways, mass transit, and rail--is
increasingly important.  The Transportation Research Board estimates
that the Department of Transportation devotes between $2 million and
$5 million each year to intermodal research.  Public and private
officials identified institutional barriers and freight movement as
intermodal problems requiring further research. 

According to transportation officials, the current mix of research
projects gives too little emphasis to basic, long-term, high-risk
surface transportation research.  Because about 80 percent of the
projects are applied, short-term, or low-risk, the officials were
concerned that quantum leaps--generally credited to basic
research--would not occur and users' needs would not be met.  For
example, surface transportation research that focuses on incremental
improvements in asphalt would not deal with fundamental questions,
such as whether asphalt for highways will be needed in 20 years. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 0:5

GAO is making no recommendations in this report. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 0:6

GAO provided a draft of this report to the Department of
Transportation for its review and comment.  GAO met with departmental
officials, including the Associate Administrator for Research,
Technology, and Training in the Research and Special Programs
Administration and officials from the Office of the Secretary, FHWA,
the Federal Railroad Administration, the Federal Transit
Administration, and the National Highway Traffic Safety
Administration.  The Department generally concurred with the
information presented and the observations made throughout the
report.  FHWA concurred with the report's findings and conclusions
but said that the report gave the impression that the Department's
funding is insufficient for basic, long-term, high-risk research. 
FHWA stated that about 15 percent of its funding for research is
focused on basic research.  GAO included this information in the
report. 

The Department also suggested editorial changes to the report, which
were incorporated where appropriate. 


BACKGROUND
============================================================ Chapter 1

The nation's transportation system depends increasingly on
innovations from research to improve its performance.  Improving
performance is vital because transportation figures prominently in
the nation's economy and quality of life.  The nation's expenditures
on transportation illustrate its importance--spending on passenger
and freight transportation exceeds $1 trillion annually, constituting
about 11 percent of the nation's gross domestic product.  U.S. 
consumers spend more on transportation than on any other item except
housing.  In addition, governments invest heavily in the nation's
transportation system.  During 1992, the federal government and state
and local governments invested an estimated $113 billion in
transportation. 

Decisions about surface transportation research have important
consequences because such research provides knowledge, products, and
technologies to improve the efficiency, effectiveness, and safety of
the nation's transportation system.  Decisions about research are
assuming more importance as aging highway, transit, and rail systems
deteriorate; demands on the transportation system increase; and
constraints on resources grow. 


   SURFACE TRANSPORTATION RESEARCH
   INCLUDES A WIDE AND GROWING
   RANGE OF ACTIVITIES
---------------------------------------------------------- Chapter 1:1

Surface transportation research embraces different transportation
modes and serves different purposes.  Such research spans three
distinct modes--highways, mass transit, and railroads.  It also
encompasses issues such as safety and the connections between modes. 
Five agencies in the Department conduct surface transportation
research:  the Federal Highway Administration (FHWA), the Federal
Railroad Administration (FRA), the Federal Transit Administration
(FTA), the National Highway Traffic Safety Administration (NHTSA),
and the Research and Special Programs Administration (RSPA). 

Surface transportation research supports several of the Department of
Transportation's (DOT) missions, including

  -- making policy (research informs decisions on transportation
     issues and policies);

  -- regulating modes of transportation (research supports regulatory
     responsibilities for safety compliance with legislative
     mandates, such as auto safety standards);

  -- responding to national needs (research identifies means of
     improving transportation safety and mobility); and

  -- overseeing operations (research improves technologies for
     inspecting train wheels and tracks). 

Traditionally, research has been viewed as a continuum that begins
with basic and applied research and moves toward development,
demonstration, and technology transfer.  Table 1.1 represents this
progression. 



                               Table 1.1
                
                          Research Activities

Activity                Characteristics         Examples
----------------------  ----------------------  ----------------------
Basic research          Creates new or          Exploring basic
                        enhanced knowledge      properties of
                        about basic phenomena.  materials used to
                        No specific             construct highways,
                        expectations for        e.g., behavior of
                        results.                recycled concrete.

Applied research        Addresses specific      Discovering more
                        questions; produces     durable,
                        knowledge relevant to   manufacturable
                        producing a technology  materials for highways
                        or service.             and railroad track.

Development             Uses research findings  Producing a prototype
                        to develop practical    of new highway
                        applications or         construction
                        prototypes.             materials.

Demonstration           Illustrates operation   Showing how automated
                        of new technologies     reservation,
                        and applications.       dispatching, and
                                                billing systems for
                                                transportation geared
                                                to the disabled will
                                                operate.

Technology transfer/    Communicates research   Disseminating research
training                and development         information via the
                        knowledge and/or        Internet, newsletters,
                        products to users in    trade journals,
                        the private and public  bulletins, forums, and
                        sectors.                seminars.
----------------------------------------------------------------------
This traditional linear view of research has been changing. 
Increasingly, research is seen as a process of continuous feedback
involving interactions between activities on the continuum.  In
addition, opportunities for using new technologies and emerging
transportation needs influence research.  DOT's surface
transportation research concentrates primarily on applied research,
development, demonstration, and technology transfer. 


   RESEARCH HAS IMPROVED SURFACE
   TRANSPORTATION
---------------------------------------------------------- Chapter 1:2

According to public and private officials we consulted, investments
in research have provided benefits to surface transportation users
and the economy.  One expert pointed out that these benefits continue
for a long time.  DOT officials said that although research produces
important results, its benefits may not be recognized because they
are taken for granted.  These benefits include crash protection
devices, such as seat belts, motorcycle helmets, and car seats for
infants and children; programs to reduce alcohol-related deaths;
longer-lasting highway surfaces that reduce maintenance costs; and
improved roadside safety hardware, such as guardrails and road signs
that yield to the force of a collision. 

States have realized benefits from their surface transportation
research programs.  Through a study of drivers' behavior, for
example, university researchers for the Ohio Department of
Transportation found little to no benefit from using steady-burn
lights on barrels in construction zones.  (Steady-burn lights are
low-wattage yellow electric lamps, which may be used to mark
obstructions or hazards.) When the study showed that the lights did
not influence drivers' speed or other behavior in construction zones,
the state stopped requiring the lights.  The Department estimated
that this change would save more than $4 million annually without
affecting safety.  The Indiana Department of Transportation also
benefited from its research programs.  Its maintenance engineers, in
cooperation with university researchers, developed a computer-aided
system for planning efficient routes to remove snow and ice.  The
Department, which is responsible for more than 30,000 lane-miles of
roadway, expected that this system would enable it to eliminate about
120 snow removal routes and save between $86,000 and $120,000 per
year for each eliminated route. 


   ISTEA PROVIDED NEW DIRECTION
   AND FUNDING FOR SURFACE
   TRANSPORTATION RESEARCH
---------------------------------------------------------- Chapter 1:3

The Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA)
expressed the need for a new direction in surface transportation
research, finding that despite an annual federal expenditure of more
than $10 billion on surface transportation and its infrastructure,
the federal government lacked two key components for an effective
surface transportation research program:  (1) a clear vision of the
role of federally funded surface transportation research and (2) an
integrated framework for the fragmented surface transportation
research programs dispersed throughout the government. 

In response to these concerns, ISTEA established a framework for
changing surface transportation research.  Overall, the act
underscored the need for a "more active, focused surface
transportation research and development program" that would foster
cooperation among the federal government, industry, and universities. 
It called for an integrated national surface transportation research
framework that would include "consensus on the goals." The act also
stated that the federal role should be to sponsor and coordinate
research and development on new technologies that would provide
safer, more convenient, and more affordable future transportation
systems. 

ISTEA also reflected congressional concerns about the adequacy of the
funding for advanced transportation systems, suggesting that too
little funding would increase the nation's dependence on foreign
technologies and equipment.  The act therefore increased the funding
for many existing and new research programs, especially for the
Intelligent Transportation Systems (ITS) program, which applies
numerous electronics, communications, and information-processing
technologies to intelligent vehicle-highway systems. 

Figure 1.1 shows how the funding for surface transportation research
has changed since 1970.  From 1970 to 1981, the bulk of the funding
supported research on transit and railroad technologies that could
revitalize cities and make rail services more productive.  According
to estimates from the John A.  Volpe National Transportation Systems
Center (Volpe Center),\1 this research absorbed nearly half of DOT's
annual research budget between 1975 and 1981.  From 1981 to 1991, the
support for rail and transit research declined, as did the total
funding for research.  Projects sponsored by NHTSA and FHWA were cut
less than others because both the Congress and the administration
supported these agencies' missions of increasing safety and
completing the Interstate highway system.  In 1987, the Congress
authorized the Strategic Highway Research Program, providing a modest
increase in the funding for highway research.  In 1991, ISTEA
continued to direct funds into highway research via its support for
ITS. 

   Figure 1.1:  DOT's Research and
   Development Appropriations, by
   Organization, in Constant 1992
   Dollars, Fiscal Years 1970-92

   (See figure in printed
   edition.)

   Note 1:  Nominal dollars were
   converted to constant dollars
   using the 1992 Consumer Price
   Index (1992=100).

   (See figure in printed
   edition.)

Note 2:  This figure does not include data for fiscal year 1971. 

Source:  The Volpe Center. 


--------------------
\1 Located in Cambridge, Massachusetts, the Volpe Center is part of
DOT's Research and Special Programs Administration.  It provides
research, analytic management, and engineering support to DOT, other
federal agencies, state and local governments, and private
organizations. 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:4

To prepare for reauthorizing the Intermodal Surface Transportation
Efficiency Act of 1991 (ISTEA), the Chairman and Ranking Minority
Member of the Senate Committee on Environment and Public Works and
the Chairman of that Committee's Subcommittee on Transportation and
Infrastructure asked us to provide information on the Department of
Transportation's surface transportation research programs.  This
report discusses (1) the public and private funding for surface
transportation research, (2) the transportation community's views on
the federal role for research and DOT's ability to fulfill that role,
and (3) the issues that the transportation community believes the
Congress and DOT should consider during ISTEA's reauthorization. 

To identify the public and private funding for surface transportation
research, we reviewed DOT's research program budgets, three surface
transportation research plans, and program and budget information
from other sources.  In addition, we interviewed officials in FHWA,
FRA, FTA, NHTSA, RSPA, and the Office of the Secretary. 

To obtain knowledgeable views on the federal role in surface
transportation research and DOT's ability to fulfill this role and to
identify directions for research, we interviewed DOT officials,
representatives of state departments of transportation, university
researchers, representatives of transportation organizations and the
transportation industry, and other experts with direct knowledge of
surface transportation research.  Appendix I lists the groups we
consulted.  In addition, we reviewed documents on research, including
a survey of state transportation research staff published in 1995 by
the American Association of State Highway and Transportation
Officials' (AASHTO) Research Advisory Committee.  We also reviewed
many public and private analyses of transportation research.  We
analyzed the proceedings of the Forum on Future Directions in
Transportation R&D (Forum),\2 sponsored in 1995 by the Transportation
Research Board and the National Science and Technology Council
(NSTC), to identify participants' comments about potential federal
roles in surface transportation research.  This analysis provided
additional support for our findings because approximately 170
representatives from the federal government, state and local
governments, industry, universities, private and public interest
groups, and transportation users participated in this forum.  In
addition, we conducted extensive interviews and observed operations
at the John A.  Volpe National Transportation Systems Center.  We
performed our review from August 1995 through August 1996 in
accordance with generally accepted government auditing standards. 

We provided a draft of this report to the Department of
Transportation for its review and comment.  We met with RSPA's
Associate Administrator for Research, Technology, and Training and
with officials from the Office of the Secretary, FTA, FHWA, FRA, and
NHTSA to obtain DOT's comments.  DOT generally concurred with the
information presented and the observations made throughout the
report.  DOT provided information to update our report, which we
incorporated in chapter 3.  DOT also provided additional information
on its basic research program, discussed at the end of chapter 4. 


--------------------
\2 Forum on Future Directions in Transportation R&D, Washington, D.C. 
(Mar.  6-7, 1995). 


PUBLIC AND PRIVATE FUNDING FOR
SURFACE TRANSPORTATION RESEARCH
============================================================ Chapter 2

Since ISTEA's enactment in 1991, the federal funding for surface
transportation research has totaled nearly $2.9 billion.  DOT's modal
agencies have used these funds to support several research programs,
but much of the funding has gone to FHWA's ITS program.  Although
ISTEA required the states to spend more funds on research, the
states' support for research is relatively small compared with the
federal support.  Because data on industry's total funding for
surface transportation research is proprietary, this information is
limited. 


   MOST OF DOT'S SURFACE
   TRANSPORTATION RESEARCH BUDGET
   HAS GONE TO FHWA
---------------------------------------------------------- Chapter 2:1

Between fiscal year 1992 and fiscal year 1996, DOT budgeted about
$2.9 billion (in appropriations and contract authority) for surface
transportation research--about 2 percent of its total surface
transportation budget.  Table 2.1 shows how these funds were divided
among DOT's surface modal agencies--FHWA, FRA, FTA, NHTSA, and RSPA. 



                               Table 2.1
                
                   Funding for Surface Transportation
                     Research, Fiscal Years 1992-96

                         (Dollars in thousands)


Agency                  1992    1993    1994    1995    1996     Total
--------------------  ------  ------  ------  ------  ------  --------
FHWA                  $445,9  $385,3  $443,0  $427,9  $444,3  $2,146,6
                          16      85      20      66      57        44
FRA                   22,331  25,205  28,565  40,067  48,266   164,434
FTA                   94,670  49,881  48,263  51,290  45,914   290,018
NHTSA                 43,016  49,401  42,628  56,270  55,290   246,605
RSPA                   2,521   2,384   2,739   8,220   7,008    22,872
======================================================================
Total                 $608,4  $512,2  $565,2  $583,8  $600,8  $2,870,5
                          54      56      15      13      35        73
----------------------------------------------------------------------
Note:  For fiscal years 1992-95, the figures are actual, and for
fiscal year 1996, they are enacted. 

Through fiscal year 1996, FHWA received 75 percent of the total
funding for surface transportation research.  Yet FHWA, like the
other modal agencies, spent a relatively small percentage of its
total budget for research.  (See table 2.2.)



                               Table 2.2
                
                   Research as a Percentage of Modal
                  Agencies' Budgets, Fiscal Year 1996

                         (Dollars in millions)

                                  Research
Agency                              budget  Total budget       Percent
----------------------------  ------------  ------------  ------------
FHWA                                  $444       $19,931          2.23
FRA                                     48           873          5.53
FTA                                     46         4,049          1.13
NHTSA                                   55           277         19.93
RSPA                                     7            55         12.70
Total                                 $601       $25,186          2.39
----------------------------------------------------------------------
Note:  Numbers may not add because of rounding. 

Source:  GAO's analysis of data from DOT. 

Although NHTSA devoted a much higher percentage of its budget (20
percent) to surface transportation research than FHWA (2 percent),
FHWA budgeted nearly eight times as much ($444 million) for research
as NHTSA ($55 million).  RSPA devoted 13 percent of its budget to
surface transportation research, FRA 6 percent, and FTA 1 percent. 


   ITS PROGRAM DOMINATES SURFACE
   TRANSPORTATION RESEARCH
   PROGRAMS
---------------------------------------------------------- Chapter 2:2

DOT's five modal agencies' surface transportation research programs
differ not only in the size of their budgets but also in the focus of
their research and in their customers.  However, FHWA's ITS program
overshadows the other programs, reflecting both the traditional
dominance of highways in surface transportation and congressional
statutory requirements, which established the ITS program under
ISTEA.\3

Although the modal administrations set the surface transportation
research agenda, their programs, budgets, and customers contrast
sharply, as indicated in table 2.3. 



                                        Table 2.3
                         
                           Overview of Modal Agencies' Research
                                Programs, Fiscal Year 1996

                                  (Dollars in millions)

Agency          Major research programs                  Budget  Customers
--------------  ----------------------------  -----------------  ------------------------
FHWA            Intelligent transportation                 $444  Noncommercial and
                systems (ITS); highway                           commercial drivers and
                materials, pavements,                            passengers; state/local
                structures, and rights-of-                       transportation and
                way; environment; safety;                        planning agencies;
                highway designs and                              service providers;
                facilities for pedestrians/                      universities;
                cyclists; advanced research                      contractors and
                                                                 consultants

NHTSA           Data programs;                              $55  NHTSA for rulemaking and
                crashworthiness, heavy                           resulting interaction
                vehicle/driver safety;                           with motor vehicle
                pedestrian/bicycle safety;                       industry; national
                traffic safety; ITS crash                        safety organizations
                avoidance; National Advanced
                Driving Simulator

FRA             High-speed ground                           $48  Freight, commuter, and
                transportation; safe                             passenger railroads;
                equipment, structures, and                       states; industry
                controls; hazardous                              associations;
                materials; human performance                     passengers; FRA (for
                factors; technology                              rulemaking)
                demonstrations

FTA             Transit cooperative research                $46  State/local transit and
                program; advanced transit                        planning agencies;
                systems; technology                              riders; transit
                development; clean air;                          operators; paratransit;
                financing; mobility for                          bus manufacturers
                urban/suburban riders; safe
                equipment and conditions for
                riders

RSPA            Building a knowledge base of                 $7  DOT's modal
                DOT's research activities                        administrations;
                and disseminating the                            state/regional/local
                results of research;                             agencies; RSPA (for
                hazardous materials and                          rulemaking)
                pipeline safety; technology
                transfer; Volpe Center;
                university research program
-----------------------------------------------------------------------------------------
As figure 2.1 shows, ITS is FHWA's largest research program.  It
received $204 million in fiscal year 1996, or nearly half of FHWA's
funding for research.  ITS is about four times as large as either
FRA's or FTA's research program.  ISTEA established ITS and
authorized $659 million for it for fiscal years 1992-97.  The
appropriations process provided additional funding, bringing the
total for fiscal years 1992-96 to $1.01 billion.  The ITS program
uses research in computer and information technology to identify ways
of improving highway capacity and safety.  Much of FHWA's research is
designed to benefit state and local governments by developing new
materials and techniques. 

   Figure 2.1:  Largest Research
   Program in Each Modal Agency,
   Fiscal Year 1996

   (See figure in printed
   edition.)

Source:  GAO's analysis of data from DOT. 

Through its research, NHTSA develops a scientific basis for its
vehicle safety and driver safety programs.  The largest portion of
its funding--$17 million in fiscal year 1996--is directed to its data
programs.  The National Center for Statistics and Analysis is
responsible for maintaining large-scale databases that are used to
support highway safety, vehicle rulemaking, and safety recall
programs.  These databases are also the primary source of information
on motor vehicle and highway safety for DOT's other modal agencies,
especially FHWA, as well as for state and local governments, the
automobile and insurance industries, and consumers. 

Much of FRA's recent funding for research--$21 million in fiscal year
1996--has supported work on high-speed ground transportation.  The
technology deployment portion of FRA's Next Generation High-Speed
Rail Development Program supports strategies that FRA believes are
essential to the success of high-speed rail in the United States. 
Through the program, FRA has developed partnerships with suppliers,
railroads, and state agencies to make high-speed rail more
financially feasible, thereby seeking to encourage states to develop
high-speed rail in selected corridors. 

FTA's largest research program--$8 million in fiscal year 1996--is
the Transit Cooperative Research Program, an applied research program
designed to yield innovative and near-term solutions to transit
problems.  While sponsored by FTA, the program is carried out under
an agreement among FTA, the National Academy of Sciences acting
through the Transportation Research Board, and the Transit
Development Corporation, an educational and research arm of the
American Public Transit Association.  The program supports a broad
range of research projects and activities to address the immediate
and practical needs of transit, as well as to facilitate the transfer
of technical information.  State and local transit and planning
agencies are the program's primary customers. 

RSPA's largest research program--$3 million in fiscal year 1996--is
the Research Management and Application Program, whose focus is to
develop a database of advanced transportation technology topics and
ensure that the results of research and development on these topics
are widely available.  RSPA's customers include DOT's modal agencies,
state and local governments, the transportation community, and
academia. 


--------------------
\3 NHTSA and FTA have received about $10 million a year in
appropriations for their ITS programs. 


   STATES, UNIVERSITIES, AND
   INDUSTRY SUPPORT SURFACE
   TRANSPORTATION RESEARCH
---------------------------------------------------------- Chapter 2:3

ISTEA encouraged the states, universities, and the private sector to
become more involved in surface transportation research.  ISTEA
required the states to devote 2 percent of their federal-aid funds to
planning and research and to direct at least 25 percent of these
funds solely to research, development, and technology transfer. 
Although DOT does not monitor the states' annual expenditures of
federal-aid funds for research, AASHTO reported that between 1989 and
1995 the states increased these expenditures by 66 percent (from $53
million to $88 million).  ISTEA also encouraged the states to use
their federal-aid funds to leverage additional funds from state and
other sources.  According to AASHTO, between 1989 and 1995 the states
increased their own annual funding for research by 130 percent (from
$33 million to $76 million).  Now that ISTEA requires the states to
spend a minimum percentage of their federal-aid funds on research,
AASHTO estimated that about 53 percent of the states' fiscal year
1995 funding for transportation research came from the federal
government.  AASHTO also found that, in keeping with ISTEA's intent,
most states have increased their expenditures for research in surface
modes other than highways. 

ISTEA has continued to involve universities in surface transportation
research, bringing five new universities into the University
Transportation Center program.  These centers, like the original 10
established by the Surface Transportation and Uniform Relocation
Assistance Act of 1987, are funded by both FHWA and FTA.  ISTEA also
authorized $38 million over 6 years for five additional university
research institutes, which receive funding through the Highway Trust
Fund.  Finally, ISTEA authorized $18 million over 6 years for the
National Transit Institute, which provides training for anyone
involved in federal-aid transit work. 

Although ISTEA encourages cooperation between the public and private
sectors in conducting surface transportation research, the
Transportation Research Board has generally found information about
the private sector's expenditures for research and development
difficult to obtain.  The private sector's research is conducted or
sponsored primarily by major national industrial and engineering
associations.  According to the Transportation Research Board, these
associations spent about $21 million on highway research and
technology in 1993.  Meanwhile, the Association of American Railroads
spent $26 million for rail research in 1994.  Except for projects
supported by a handful of major companies, research programs
sponsored by individual companies are difficult to identify and
characterize because they are so numerous and their findings remain
proprietary. 


PROGRESS AND LIMITATIONS IN MOVING
TOWARD A MORE STRATEGIC ROLE FOR
SURFACE TRANSPORTATION RESEARCH
============================================================ Chapter 3

Representatives of five groups of transportation
stakeholders--federal, state, university, industry, and other
experts--agreed that DOT should lead the nation's surface
transportation research effort and fulfill three principal
roles--funding research, establishing a strategic agenda, and acting
as a focal point for technology transfer.  DOT has established
councils and committees to coordinate its research both internally
and externally.  However, DOT's modal organizational structure and
lack of both a focal point and a strategic plan for surface
transportation research, together with congressional directives to
initiate or maintain specific research efforts, may limit DOT's
ability to lead.  Until these constraints are addressed, the federal
government may not be able to respond effectively to ISTEA's call for
an integrated framework for specifying national research goals. 


   DOT BRINGS A NATIONAL
   PERSPECTIVE TO SURFACE
   TRANSPORTATION RESEARCH
---------------------------------------------------------- Chapter 3:1

DOT's role as the leader in surface transportation research stems
from the Department's national perspective, which transcends the
interests and limitations of nonfederal stakeholders:  The states
generally focus on applied research that is geared to solving
specific transportation problems; industry focuses on research that
is often proprietary and geared to developing new or increased
markets for selling goods and services; and universities focus on
training future transportation specialists and conducting research
that reflects the interests of its funders.  Although all of these
stakeholders advance knowledge, it is unlikely that they could
replace the federal government as the focal point for surface
transportation research. 

The states generally focus their research agendas and dollars on
applied research--research that addresses specific questions and is
designed to result in the information needed to produce a certain
technology or service.  According to the Transportation Research
Board, highway problems are often of local interest and can best be
addressed by state highway departments.  For example, the Colorado
Department of Transportation has many ongoing projects aimed at
predicting where and when avalanches are likely to occur.  In 1993,
the Colorado Transportation Institute began exploring less costly
measures to protect travelers from avalanches.  The Institute tested
two new monitoring systems that "listen" for sound waves signaling
the approach of an avalanche.  These advanced systems will allow the
state to warn traveling motorists 40 to 60 seconds before an
avalanche reaches the roadway. 

Private companies also focus on applied research.  According to the
Transportation Research Board, the private sector's highway research
is sponsored by national associations representing industry and the
engineering professions or by companies that design and construct
highways and supply highway-related products.  According to a federal
research official, the private sector has few incentives to conduct
highway research because its main service--constructing highways and
bridges--occurs in a contracting environment in which payment for
completing services is based more on adhering to rigid design
standards than on finding innovative means of building better
highways.  The private sector's rail research is supported through
the Association of American Railroads, whose researchers confirmed
that they focus on applied research that is targeted to improving
safety and building better equipment.  For example, the association
is coordinating research on the effects of 125-ton cars on
conventional track structures.  In addition, when the private sector
conducts research, it often does not share its results with the
research community because its findings are proprietary.  A Civil
Engineering and Research Foundation study noted that the private
sector's research is designed to gain a competitive advantage and
firms protect the rights to their results. 

Finally, universities focus on educating future transportation
professionals and spending the funds provided by government agencies
or the private sector.  Much of the highway research funded by FHWA,
the states, and the private sector is performed by universities,
especially those with specialized testing facilities and technical
experts.  However, as some university stakeholders observed,
universities do not have the funds to conduct their own research and
often shift their research agendas to focus on the areas with the
most federal funding.  Accordingly, the potential for universities to
compensate for reductions in federal funding is limited. 


   THE FEDERAL GOVERNMENT PROVIDES
   LEADERSHIP
---------------------------------------------------------- Chapter 3:2

Given the specific interests of nonfederal stakeholders, the members
of the transportation community with whom we spoke agreed that the
federal government should lead the nation's surface transportation
research.  They said that DOT should fund research, especially
research that generates new ideas; establish a strategic agenda; and
act as a focal point for technology transfer. 


      DOT'S ROLE IN FUNDING
      RESEARCH
-------------------------------------------------------- Chapter 3:2.1

Representatives of the five groups we interviewed--federal, state,
industry, university, and other experts--agreed that DOT should
support surface transportation research.  Without federal support,
they said, there would be no innovation in the transportation
industry--especially in areas of general rather than particular
interest, such as social objectives, land use, data collection, and
the transportation system as a whole.  Federal officials said that
the federal government should support research to find solutions to
national needs and problems.  University representatives emphasized
the importance of federal funding because it supports their research. 

In addition, according to representatives of the transportation
industry, academia, local governments, and state governments who
attended the March 1995 Forum on Future Directions in Transportation
R&D (Forum),\4 financial support for research is a federal
responsibility.  Private-sector participants believed, and state
representatives concurred, that the federal government has a
responsibility to fund transportation research and share the risk of
investing in new technologies whose public acceptance, market
acceptance, and technical feasibility are uncertain. 


--------------------
\4 See footnote 2. 


      DOT'S ROLE IN ESTABLISHING A
      RESEARCH MISSION AND
      DEVELOPING A STRATEGIC PLAN
-------------------------------------------------------- Chapter 3:2.2

Representatives of the five stakeholder groups agreed that the
federal government should establish an overall research mission and
provide strategic planning and management to achieve this mission. 
According to DOT's Surface Transportation Research and Development
Plan, DOT, as steward of the nation's transportation system, must
lead the effort to set transportation standards and develop a
national surface transportation research and development agenda to
achieve these standards.  A former DOT official noted, for example,
that DOT leads the national research and development efforts in
safety and regulatory issues because other stakeholders have little
or no incentive to support such research.  Under DOT's leadership,
the use of safety belts increased from 11 percent in 1982 to 68
percent in 1995 and the proportion of traffic fatalities involving
alcohol declined from 57 percent in 1982 to 41 percent in 1994.  In
addition, by focusing on transportation's strategic goals, DOT can
develop solutions to intermodal problems.  Without a federal
strategy, problems such as traffic congestion, which require an
intermodal solution, may go unaddressed.  Industry representatives
discussing the National Science and Technology Council's draft
Strategic Implementation Plan for Transportation Research and
Development at the Forum also agreed that the federal government has
a role in setting standards and sponsoring research. 

The stakeholders also agreed that DOT should cooperate with others in
the transportation community and direct resources toward achieving
its research mission and goals.  University officials said, for
example, that as part of its strategic planning role, DOT must build
relationships among the various stakeholders, since the solutions to
transportation problems require more than research on building a
sturdier road.  Transportation officials also stated that DOT should
direct resources toward achieving its research mission and goals by
coordinating the efforts of other stakeholders.  AASHTO indicated in
its policy statement on ISTEA's reauthorization that the federal
government should coordinate the development of technologies of
national interest.\5


--------------------
\5 Research:  Innovation for Transportation (Dec.  1995), p.  3. 


      DOT'S ROLE AS A FOCAL POINT
      FOR TECHNOLOGY TRANSFER
-------------------------------------------------------- Chapter 3:2.3

Finally, representatives from three of the five stakeholder
groups--federal, state, and other experts--said that the federal
government should act as a clearinghouse for information on surface
transportation research and its results and ensure that new
technologies are transferred to users.  According to a DOT official,
the federal government is in a good position to disseminate the
results of surface transportation research to many users--states,
cities, and the industry.  In addition, in its policy statement on
ISTEA's reauthorization, AASHTO recommended that DOT continue its
ongoing programs to transfer technology to state and local highway
agencies and private organizations.  According to the policy
statement, one such program, the Strategic Highway Research
Implementation Program, has produced valuable products, from pavement
designs to snow removal technologies.  Finally, according to Forum
participants, the federal government needs to act as a focal point
for gathering and disseminating information on ongoing as well as
completed research because other parties are unlikely to perform
these tasks. 


   DOT HAS MADE PROGRESS IN
   COORDINATING RESEARCH PROGRAMS
---------------------------------------------------------- Chapter 3:3

To improve the external and internal coordination of DOT's surface
transportation research program, the Secretary, in 1993, formed the
Coordinating Committee on Transportation Research and Development
(Coordinating Committee) under the National Science and Technology
Council.\6 He also created the position of Director of Technology
Deployment within the Office of the Secretary and established the
Research and Technology Steering Committee (Steering Committee) and
the Research and Technology Coordinating Council (Coordinating
Council) within DOT.  These actions have helped to improve the
coordination of DOT's research programs. 

Figure 3.1 displays the linkages among DOT's research-related
committees and councils and other federal departments.  At the
interdepartmental level, the Coordinating Committee sets federal
priorities in transportation research and exchanges information about
research programs among the executive branch departments involved in
transportation research.  The Committee's members represent DOT and
the departments of Commerce, Defense, and Energy. 

   Figure 3.1:  DOT's Surface
   Transportation Research
   Organization

   (See figure in printed
   edition.)

Note:  The Coordinating Committee, the Steering Committee, and the
Coordinating Council include representatives all of DOT's modal
agencies, not just the surface modes. 

Source:  GAO's analysis of information from DOT. 

DOT has three mechanisms for coordinating research--the Director of
Technology Deployment in the Office of the Secretary, the Steering
Committee, and the Coordinating Council.  The Director of Technology
Deployment is responsible for coordinating DOT's transportation
research and development programs externally, with those of other
federal agencies, and internally, among DOT's modal agencies.  The
value of this position lies in its day-to-day involvement and
interaction with the Secretary and Deputy Secretary, allowing for
quick intervention when opportunities arise to emphasize DOT's
research.  The position also offers modal research directors a focal
point for bringing issues to the Secretary.  This position increased
the visibility of DOT's research programs and emphasized their
coordination, but since May 31, 1996, the position has been vacant. 

The Steering Committee establishes policies on research and
technologies, budget priorities, and strategic plans for the
Department, and its members include the administrators of DOT's modal
agencies and certain assistant secretaries.  The Coordinating Council
implements the policies set by the Steering Committee and consists of
the associate administrators and office directors associated with
DOT's research program.\7 According to the former Director of
Technology Deployment, the Coordinating Council has done more to
coordinate research than the Steering Committee.  DOT officials
indicated that the Steering Committee meets only once or twice a year
and its mission has become blurred with that of the National Science
and Technology Council's Coordinating Committee.  The Coordinating
Council, however, meets monthly and its members are committed to
furthering DOT's research agenda.  According to DOT, the Coordinating
Council provides a forum for sharing information about areas of
common interest, such as human factors, physical infrastructure, and
nondestructive testing.\8

Furthermore, members of the Coordinating Council may identify
opportunities for further research that researchers themselves have
not perceived because they are too close to their work. 


--------------------
\6 In 1993, President Clinton established the National Science and
Technology Council to help coordinate science, space, and technology
policies across the federal government.  The Council is made up of
representatives from the departments of Commerce, Defense, Energy,
and Transportation and is housed within the President's Office of
Science and Technology Policy. 

\7 A Research and Development Coordinating Council was originally
created in 1984.  However, it was no longer fully functioning in 1993
when DOT reestablished it and created new membership and objectives. 

\8 Human factors research involves studying human behavioral issues,
such as the impact of fatigue on drivers' performance. 
Nondestructive testing involves inspecting structures, such as
bridges, while leaving the structures themselves intact.  It makes
use of technologies such as radar and ultrasound. 


   ORGANIZATIONAL FACTORS
   CONSTRAIN THE ESTABLISHMENT OF
   AN AGENCYWIDE STRATEGIC PLAN
   FOR SURFACE TRANSPORTATION
   RESEARCH
---------------------------------------------------------- Chapter 3:4

Several organizational factors limit DOT's ability to develop a
strategic approach to, and establish a clear agenda for, surface
transportation research across all modes.  Most importantly, surface
transportation research within DOT is modally focused and lacks a
central focal point.  An Assistant Secretary for Research and
Development might serve as a focal point, but DOT does not have such
a position.  The Director of Technology Deployment, within the Office
of the Secretary, could also act as a focal point.  However, as
noted, this position remains vacant.  Although RSPA was established
to foster cross-cutting research, it does not have the resources or
the internal clout to function effectively as a strategic planner for
surface transportation research.  In addition, congressional earmarks
limit DOT's ability to guide surface transportation research.  DOT's
Surface Transportation Research and Development Plan illustrates
problems that the Department faces in taking a more strategic
approach to changing transportation needs. 


      DOT'S MODAL ORGANIZATION
      LIMITS STRATEGIC PLANNING
-------------------------------------------------------- Chapter 3:4.1

Although some coordination of the modal agencies' research agendas
occurs through the Steering Committee and the Coordinating Council,
surface transportation research is largely a modal initiative.  Each
modal agency has separate research programs and budgets,
congressional authorizing committees, and programmatic and fiscal
controls over its research programs. 

The modal organization allows each modal agency to focus on its own
environment, goals, and users.  For example, FHWA's main focus is
public roads and highways (publicly owned infrastructure).  The
primary users of FHWA's research are state and local transportation
departments, which look to research to help repair the public
infrastructure and find new and better materials for pavements. 
FRA's focus is the rail industry and its privately owned
infrastructure.  Users of its research--freight railroads, Amtrak,
commuter railroads, and shippers--look to FRA to conduct research
that will reduce track failure, equipment failure, and human error. 

According to the transportation stakeholders we consulted, DOT's
modal organization inhibits centralized decision-making and
coordination and works against cross-modal cooperation.  Government
and university officials and other transportation experts told us
that having separate modal agencies with their own constituencies
works against a strategic approach.  Each modal agency handles its
budget independently and responds to its own constituency.  This
modal structure makes it difficult for DOT to develop a surface
transportation system mission; accommodate the need for types of
research--such as intermodal and systems assessment research--that do
not have a modal focus; identify and coordinate research that cuts
across modes; and evaluate research.  Evaluation is particularly
difficult because DOT has no single database that provides complete
information on its research programs and projects. 


      DOT HAS NO FOCAL POINT FOR
      SURFACE TRANSPORTATION
      RESEARCH
-------------------------------------------------------- Chapter 3:4.2

A March 1996 study by the Transportation Research Board stated that
when DOT was created, the intent was to have an Assistant Secretary
for Research and Development, analogous to the Director of Defense
Research and Engineering in the Department of Defense (DOD).  Such a
position was established when DOT was first created but was abandoned
in the late 1970s with the formation of RSPA.  DOT attempted to
reorganize and consolidate its research program in fiscal year 1996,
when it proposed,\9 in its budget submission, to consolidate the
surface modal agencies and their research programs.  DOT also
proposed to create a new position--an Assistant Secretary for
Transportation Technology--and centralize the budgeting and
programming for its research under this position.  According to DOT,
an assistant secretary would be able to look beyond the modal
perspective and scrutinize all research programs, thereby improving
the coordination of the Department's research agenda.  The Congress
did not approve either proposal in 1995. 

In the absence of an Assistant Secretary for Transportation
Technology, DOT's primary focal point for coordinating research is
the Director of Technology Deployment in the Office of the Secretary. 
Although this position does not have the centralized budgeting and
programming authority that DOT sought for an Assistant Secretary for
Transportation Technology, the former Director encouraged strategic
planning and coordination among the modal agencies' research
functions.  The position has not been filled since it became vacant
in May 1996.  However, the Deputy Secretary of Transportation
announced on August 21, 1996, that RSPA's newly appointed Associate
Administrator for Research, Technology, and Training would assume the
coordination functions formerly assigned to the Director of
Technology Deployment on an interim basis.  The Department has yet to
decide whether the position of Director of Technology Deployment will
be retained. 

Although DOT has made RSPA's Associate Administrator for Research,
Technology, and Training responsible for coordinating the
Department's research, RSPA does not have the resources or the
authority to fill the role of an Assistant Secretary for
Transportation Technology.  According to RSPA, its mission is to make
America's transportation systems more integrated by conducting and
fostering cross-cutting research and special programs.  In contrast
to DOT's operating agencies, which focus on specific sectors of the
transportation system, RSPA concentrates on the system as a whole. 
However, a 1991 study by the National Academy of Public
Administration found that RSPA had played only a limited role in
research and development policy, in part because its budget is small
compared with the modal agencies' research budgets.  In addition,
RSPA acts in an advisory capacity and has no control over the modal
agencies' budgets or policies. 


--------------------
\9 DOT proposed the Unified Transportation Infrastructure Investment
Program, which would have reorganized DOT into three administrations,
one of which, the Intermodal Transportation Administration, would
have incorporated all of the existing surface modal administrations. 
The program would also have created a new research position and
office. 


      CONGRESSIONAL DIRECTIVES
      LIMIT DOT'S ABILITY TO GUIDE
      RESEARCH
-------------------------------------------------------- Chapter 3:4.3

The Congress limits DOT's ability to set research priorities by
including directives in the modal agencies' appropriations budgets to
initiate or maintain specific research efforts.  These directives, or
earmarks, take a variety of forms, from specifying dollar amounts for
particular recipients to suggesting areas of research for
consideration.  The earmarks also represent different proportions of
the agencies' research budgets.  For example, FTA calculated that the
Congress earmarked 80 percent of one of its primary research programs
in fiscal year 1996.  A DOT official noted that other agencies, such
as FHWA, can better accommodate earmarks because their research
budgets are larger and some earmarks are compatible with ongoing
research programs.  However, FHWA officials stated that without
earmarks, the agency would have more latitude to match funds with
critical needs.  The appropriations committees' conferees recognized
that earmarking funds may be detrimental to meeting research
programs' goals when they stated in the fiscal year 1996 conference
report on DOT's appropriations that they would seriously consider
discontinuing their earmarking of the ITS program in fiscal year
1997. 


      DOT'S RESEARCH PLANS DO NOT
      REFLECT A STRATEGIC APPROACH
-------------------------------------------------------- Chapter 3:4.4

DOT is attempting to develop a strategic surface transportation plan
with clear goals and objectives for the federal role.  The plans that
the Department has issued to date are useful inventories of the five
modal agencies' research activities, but they cannot be used as ISTEA
directed--to make surface transportation research more strategic,
integrated, and focused. 

ISTEA required the Secretary of Transportation to develop an
integrated national surface transportation research and development
plan focusing on urban, suburban, and rural areas in the next decade. 
This plan was to include both strategic and nonstrategic elements. 
On the one hand, ISTEA placed the plan in a strategic framework,
linking it to DOT's efforts to develop transportation technologies
and maintain long-term advanced research for next-generation surface
transportation systems.  On the other hand, ISTEA required the plan
to include descriptions of the Department's surface transportation
research programs, including their funding, milestones, preliminary
cost estimates, work scopes, personnel requirements, estimated costs,
and goals over a 3-year period. 

ISTEA required the first plan to be submitted by January 15, 1993,
and updated annually thereafter.  RSPA's Volpe Center prepared the
initial plan and the two updates that DOT has submitted to the
Congress since 1993.  The first two plans, submitted in 1993 and
1995, responded primarily to ISTEA's requirement for descriptive
information.  These plans, according to DOT officials, provided the
Department with the first inventory of its major modal surface
transportation research programs.  However, both the Secretary and
the Congress asked RSPA to give the third plan a more strategic and
intermodal focus. 

The third plan, submitted in August 1996, tries to take a more
strategic approach to research by projecting the modal agencies'
research needs and programs into the future.  However, strategic
questions posed by ISTEA, such as what surface transportation
research should provide to meet users' needs in the future, receive
limited attention.  As a former DOT official observed, the third plan
moves in a more strategic direction, but it is far from being a
strategic plan.  A DOT official involved in preparing the 1996
research plan noted his difficulty in encouraging the modal agencies
to take a long-term view when their research budgets consist of
mandates and earmarks limiting their discretion. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 3:5

Transportation stakeholders generally agree that the federal
government should remain a leader in surface transportation research,
serving as the primary source of funds, developing a strategic plan,
and acting as a focal point for technology transfer.  The role of
strategic planner is particularly important because it gives DOT the
opportunity to define the best uses for the nation's limited research
dollars.  However, without a focal point for surface transportation
research at the departmental level, DOT will have difficulty assuming
the leadership role envisioned by stakeholders and achieving the
strategic goals set forth in ISTEA. 


MISMATCH BETWEEN RESEARCH
INVESTMENTS AND CHANGING NEEDS
============================================================ Chapter 4

As surface transportation problems become more complex in the next
decade, transportation experts contend that the current surface
transportation research portfolio must change to prepare the nation
for a transportation system whose present use is expected to double
by 2030.  As the Congress considers the successor to ISTEA, federal
decisions about the surface transportation research portfolio may
determine whether new knowledge and technologies will be available to
address future transportation problems. 

According to public and private transportation officials, federal
surface transportation research currently neglects two areas that
will grow more important.  First, it does not address the total
surface transportation system, giving limited attention to system
assessment, policy, and intermodal research.  Second, it does not
include enough basic, long-term, high-risk research to respond to
complex, persistent problems.  Targeting funds to changing priorities
will be important when reauthorizing ISTEA's research programs. 


   EMERGING NEEDS ARE NOT
   REFLECTED IN THE RESEARCH
   PORTFOLIO
---------------------------------------------------------- Chapter 4:1

Industry participants in a Forum session stressed that transportation
providers and their customers plan business activities on the basis
of a safe, efficient, and productive transportation system, rather
than on what each mode of transportation can offer.  As a result,
private and public transportation officials expressed concern that
the current surface transportation research portfolio was weighted
toward current, modal problems rather than emerging system problems. 
Public and private officials viewed the current research efforts as
inadequate to build knowledge in three areas:  system assessment,
policy research, and intermodal research. 


      SYSTEM ASSESSMENT RESEARCH
-------------------------------------------------------- Chapter 4:1.1

Transportation officials stated that understanding how the nation's
complex surface transportation system functions--system assessment
research--is vital to making transportation more efficient and
effective for users.  System assessment uses analytic tools to
measure, monitor, and model systems and people's performance in them. 
According to Forum participants, system assessment applies models and
simulations, cost-benefit analyses, and risk assessment to
understanding how vehicles, the physical infrastructure, and the
nonmaterial infrastructure (policies, regulations, laws, and
institutions that govern transportation) interrelate.  For example, a
university official noted that system assessment would allow
persistent problems that are not improving--particularly
congestion--to be examined on a larger scale.  The Texas
Transportation Institute estimated that congestion costs the nation
$40 billion annually in lost time and fuel. 

DOT officials noted that system assessment's broad focus and
attention to the interrelationships among the individual components
of a national system make it an appropriate area for federal
research.  However, DOT officials stated that research in this area
is limited and funding is difficult to obtain.  A federal research
manager explained that it is difficult to put system assessment into
research language and get funding because funders do not see a
tangible product.  As a result, a DOT official stated that the
inability to look at issues as part of systems has constrained DOT's
ability to manage research. 


      RESEARCH ON TRANSPORTATION
      POLICY
-------------------------------------------------------- Chapter 4:1.2

Public and private officials stated that research to support
transportation policy decisions should be a high priority in the
federal research portfolio.  These officials noted that although the
federal government and state and local governments face increasingly
complex transportation problems, policy research to resolve these
problems is not a high priority.  A university researcher added that
without reliable research, decisions risk depending on conventional
wisdom--which can be wrong.  As a result, scarce funds may be spent
inefficiently to deal with spurious cause-and-effect relationships. 
For example, a university researcher noted that local government
initiatives to restrict downtown traffic have been made with little
information about their payoffs. 

According to federal and university officials, policy research may be
least available to local transportation groups, such as the
Metropolitan Planning Organizations (MPO) that received new
decision-making responsibilities under ISTEA.  For example, MPOs are
required to conform their transportation plans to air quality goals. 
However, a federal official observed that standard models are not
available for the MPOs to use in identifying the effects of
transportation on air quality. 


      INTERMODAL RESEARCH
-------------------------------------------------------- Chapter 4:1.3

Public and private transportation officials stated that intermodal
research--how people and freight move between highways, mass transit
and rail--should be an important part of the federal research
portfolio.  Intermodal research is important because it affects the
nation's productivity and competitiveness by focusing on the
efficient movement of people and freight from one mode to another. 
Although intermodal research is viewed as important, a recent report
by the Transportation Research Board noted that the Department spent
only about $2 million to $5 million on intermodal research in fiscal
year 1995. 

Public and private officials said that additional research is needed
in two intermodal areas:  overcoming institutional barriers and
improving the movement of freight.  Representatives of local
governments participating in the Forum identified institutional
research as one of three research priorities for them.  They
explained that public and private institutions involved in
transportation often have conflicting interests that can constrain
intermodal planning, funding, and decision-making.  For example,
implementing ITS will require institutional cooperation among local
and state governments and private industry.  Both state and local
Forum participants called for more research to identify models that
would reduce local institutional barriers to intermodal
transportation planning. 

Public and private officials stated that research on how freight
moves between rail, truck, and sea is also needed.  To date, research
has focused principally on how people, rather than freight, move
between modes.  Additional intermodal research is needed to determine
how to transport the nation's huge volume of freight without major
tie-ups.  University researchers noted that the problem is
significant because fewer goods are shipped to local markets than to
regional, national, and international markets. 


   BASIC, LONG-TERM, HIGH-RISK
   RESEARCH IS NOT ADEQUATELY
   ADDRESSED
---------------------------------------------------------- Chapter 4:2

Public and private officials pointed out that current and future
research payoffs require a federal research portfolio that includes a
mix of basic and applied, short- and long-term, low- and high-risk
research.  They emphasized that basic, long-term, high-risk research
is important to provide fundamental knowledge that is the "seed corn"
for developing future technologies and information. 

The National Research Council and other experts noted that major
advances in technology come from basic research.  They cited the
Global Positioning System--rapidly becoming crucial to ITS--to show
that decades of basic research in diverse areas converged to create
new technology that is paying off.  University researchers also cited
two examples of basic, long-term research that have benefited surface
transportation.  First, behavioral demand modeling began as an
esoteric study, but in 15 years it has altered methods of predicting
the market's responses to changes in transportation pricing.  Second,
mathematical logistics, funded by the National Science Foundation as
long-term research, has become crucial to the transportation industry
and the nation's competitiveness.  U.S.  automakers have used
mathematical logistics to operate a just-in-time inventory system and
help recover their competitive position. 

Despite the need for a research mix, transportation experts said, the
current surface transportation research portfolio has too little
basic, long-term, high-risk research.  Public and private officials
viewed the portfolio as weighted heavily toward applied, short-term,
low-risk research.  Because about 80 percent of the portfolio's
research projects are applied, short-term, or low-risk, a
transportation official was concerned that quantum leaps--generally
credited to basic research--would not occur and users' needs would
not be met.  A university official stated, for example, that surface
transportation research is focusing on incremental improvements in
asphalt rather than on fundamental questions, such as whether asphalt
for highways will be needed in 20 years. 

In 1995, the National Research Council reported to the Congress\10
that balancing the surface transportation research portfolio with
more basic, long-term research would require a long-term commitment
from the United States.  However, public and private officials noted
that the United States has difficulty sustaining long-term
research--unlike Japan and Germany--and tends to lose interest after
a few years.  A university researcher whose department moved from
transit to paratransit research to follow federal funds characterized
surface transportation research as a highly fashion-conscious field
where the tendency is to move from one area to another before
solutions are found. 


--------------------
\10 Committee on Criteria for Federal Support of Research and
Development, Allocating Federal Funds for Science and Technology
(1995). 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 4:3

In commenting on a draft of this report, FHWA officials said that the
report gave the impression that the Department funds insufficient
basic, long-term, high-risk research.  They believe, however, that
their agency's program includes a significant amount of this type of
research.  According to FHWA, its research program has a 15-50-35
split--that is, about 15 percent of the funding is directed to
exploratory or long-term research projects, which are likely to be
completed in 10 years or more; 50 percent is directed to applied
research projects, which are likely to be completed within 2 to 5
years; and 35 percent is directed to refining and delivering the
products of research to the transportation community.  They cited two
ITS projects--the Crash Avoidance Research Program and the Automated
Highway Systems Program--as examples of exploratory, long-term
research. 

Our purpose was not to evaluate the Department's commitment to basic,
long-term, high-risk research but to convey the views of five groups
of transportation stakeholders--federal, state, university, industry,
and other experts.  According to these stakeholders, the current
surface transportation research portfolio includes too little basic,
long-term, high-risk research. 


SOURCES CONTACTED BY GAO
=========================================================== Appendix I

To obtain information for this study, GAO interviewed two or more
officials from each of the following groups: 


   U.S.  DEPARTMENT OF
   TRANSPORTATION
--------------------------------------------------------- Appendix I:1

Office of the Secretary
Federal Highway Administration
Federal Railroad Administration
Federal Transit Administration
National Highway Traffic Safety Administration
Research and Special Programs Administration
Bureau of Transportation Statistics
Volpe National Transportation Systems Center


   OTHER FEDERAL AGENCIES
--------------------------------------------------------- Appendix I:2

National Transportation Safety Board
National Science Foundation


   STATE GOVERNMENTS
--------------------------------------------------------- Appendix I:3

American Association of State Highway and Transportation Officials


   INDUSTRY
--------------------------------------------------------- Appendix I:4

Association of American Railroads
American Trucking Associations
General Motors/Research Institute
Arthur D.  Little, Inc. 


   TRANSPORTATION ORGANIZATIONS
--------------------------------------------------------- Appendix I:5

Transportation Research Board


   PUBLIC INTEREST GROUPS
--------------------------------------------------------- Appendix I:6

The Surface Transportation Policy Project


   EXPERTS
--------------------------------------------------------- Appendix I:7

Michael Bolton, former Director of the Capital Metro Transportation
Authority
Thomas D.  Larson, Transportation Consultant and Former FHWA
Administrator
Samuel K.  Skinner, President of Commonwealth Edison and former
Secretary of Transportation


   UNIVERSITIES
--------------------------------------------------------- Appendix I:8

Northwestern University--McCormick School of Engineering and the
Infrastructure Technology Institute
DePaul University--The Chaddick Institute
University of Illinois/Chicago--Urban Transportation Center
University of California--University Transportation Center
Texas Transportation Institute


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix II

RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION

CHICAGO

Joseph A.  Christoff
Libby G.  Halperin
Bonnie Pignatiello Leer
Gail F.  Marnik

WASHINGTON, D.C. 

Fran A.  Featherston
Phyllis F.  Scheinberg


*** End of document. ***