Infrastructure Insights: Issue #4

In this issue:

By: Braithwaite Communications

• Trump Budget calls for Air Traffic Control spin-off
• Infrastructure Investment Plan outlined in proposed Budget
• Florida Legislature approves South Florida Rail Indemnification Bill
• Florida Legislature approves changes in Tampa Bay Area Transit Authority
• Florida DEP issues Requests for Information re WV Settlement Fund
• House Hearing shows mixed support on Governor's plan to have locals pay for State Police Protection
• PennDOT 12-Year project prioritization reviewed by Senate Transportation Committee

Trump Budget calls for Air Traffic Control spin-off

President Trump's proposed budget, released May 23, would establish a "non-profit, independent corporation" to manage air traffic control (ATC). Under the plan, the new entity would be operational by 2021 after a "multi-year" transfer from the Federal Aviation Administration (FAA).

An "excellent" starting point for making the transfer, according to White House Office of Management and Budget (OMB), would be Rep. Bill Shuster's (R-PA) ATC spin off bill from last year.

The administration estimates that separating ATC from FAA will save the US Federal Government more than $10 billion annually.

"The government will retain its role in regulating aviation safety, as it does for all other modes of transportation," the OMB said.

Meanwhile, Shuster, who chairs the Transportation and Infrastructure Committee, said last week that the FAA has wasted a "shocking amount of taxpayer dollars" in its modernization efforts -- most notably with its much delayed NextGen installation for ATC.

Shuster's comments were made at a May 17 hearing examining proposed changes to the FAA as part of the upcoming reauthorization of the agency, due September 30.

Shuster has been a long-time advocate for spinning off ATC from the FAA and placing it with a non-profit private entity, as is the case in 60 other countries.

"No other single infrastructure reform has as much potential to improve travel for the average American flier," said Buchanan's Terry Heubert, Senior Advisor – Government Relations. "Although our aviation system is safe, the FAA structure and how air traffic is managed has been broken for decades."

In the Senate, Airlines for America, the national trade association for the airlines, sent a letter to Senator John Thume (R-SD), chair of the Senate Commerce, Science and Transportation Committee, stating that the FAA is overstating its progress in modernizing the current flight-monitoring system. The letter also said that the agency had repeatedly bungled technology programs.

The system "is broken beyond repair within the constraints of government," the letter said.

The airlines, former FAA air-traffic officials, other industry offices, and now the National Air Traffic Controllers Association, have joined Shuster saying that moving the agency's nearly 15,000 controllers into a nonprofit corporation would free it from budget uncertainties and allow it to adopt new technology more swiftly.

Paul Rinaldi, president of the controllers union, told committee members that the current system in the U.S. is the "gold standard," but "that status is at risk" if a more stable funding source isn't found.

Under Shuster's legislative initiative last year, a board made up of airline and other aviation stakeholders would oversee a new air-traffic corporation. Instead of the current taxes on fuel and airline tickets, it would be funded by fees paid by aircraft operators.

Infrastructure Investment Plan outlined in proposed Budget

A six-page fact sheet in the Trump administration's proposed spending plan provides an outline of the major points of a much anticipated infrastructure investment plan.

More details of the plan will be unveiled in the near future, said Transportation Secretary Elaine Chao.

"The administration's goal is to seek long-term reform on how infrastructure projects are regulated, funded, delivered and maintained," she said.

Overall, the plan asks for $200 billion in federal spending over 10 years to "incentivize" private, state and local spending on infrastructure. It's also calling for placing tolls on some interstates to raise investment funds.

The plan would also provide incentives for at least $800 billion of infrastructure investment by the private sector and state and local governments, and enticements for state and local governments to sell some assets. The money raised from the sales would be invested back in additional infrastructure projects. Administration officials said they are considering bonuses to entice the sale of assets, and to accelerate the start of infrastructure projects, officials are preparing to overhaul the federal environmental review and permitting system.

Meanwhile, officials with business, government, and organized labor descended on Washington last week, Infrastructure Week, to reinforce the need for investing heavily in the nation's crumbling infrastructure. The range of projects is expected, of course, to include highways, roads and bridge but is also likely to extend to broadband deployment and even VA hospitals. And it will also include, as National Economic Council director Gary Cohn recently said "transformative" projects, such as modernizing the system's air traffic control system.

"Air traffic control is probably the single most exciting thing we can do," Cohn said.

Finally, Trump said that he wants to give projects 120 days to get started in order to receive any federal funding. Trump had previously floated the idea of giving projects a 90-day deadline.

"When we do the infrastructure, it's going to be very important to me that if we give billions of dollars to a state, like New York, California or any other state, that they're going to have to start spending that money, they're going to have to have approval within 120 days," Trump said.

Florida Legislature approves South Florida Rail Indemnification Bill

Governor Rick Scott is expected to sign legislation, HB 695, which would provide the South Florida Regional Transportation Authority (SFRTA) with statutory authority to indemnify certain railroads within the parameters of law covering transportation in Florida.

"The indemnification legislation establishes the relationships between the operating systems and how liability will be apportioned," said Palm Beach County Commissioner Stephen L. Abrams, Vice Chair of SFRTA. "We certainly look forward to having the legislation enacted. The partners are All Aboard Florida, Florida East Coast Railroad, and the South Florida Regional Transportation Authority."

The new law would authorize SFRTA to indemnify railroads providing inner city passenger rail service or freight services on rail corridors owned or controlled by the railroads upon which SFRTA operates commuter rail service pursuant to an agreement with the railroads that requires SFRTA to indemnify the railroads as a condition to operate.

The bill limits SFRTA indemnification to the amount of liability insurance coverage it carries for its operations, not to exceed the amount of coverage authorized by applicable law, which is currently $295,000,000.

Overall, the bill would allow thousands of Tri-Rail riders to travel on the current CSX rail corridor from Mangonia Park Station in Northern Palm Beach County into the new Miami Central station without changing trains on one of 26 daily trains.

Buchanan's Brett Bacot, Senior Advisor – Government Relations said, "With the opening of Miami Central Station and the passage of this legislation, the next step will be providing coastal commuter service throughout the region originating at the Miami Central Station and utilizing the Florida East Coast Railroad allow travelers to ride between dozens of cities including Jupiter, Delray Beach, Fort Lauderdale and downtown Miami."

Florida Legislature Approves Changes in Tampa Bay Area Transit Authority

On the last day of regular session, the Florida Legislature approved legislation that would reconfigure the Tampa Bay Area Regional Transportation Authority (TBARTA) to consolidate public transportation planning in the Tampa region.

Rhea F. Law, chair of Buchanan's Florida offices, and chair of the Tampa Bay Partnership, a consortium of area business leaders pushing for the change, said that she was thrilled with the bill's passage.

"Of over 3000 bills introduced only 200 or so are approved and ours was one of them," she said.

The proposed changes stem from a white paper the Tampa Bay Partnership commissioned from the Eno Center for Transportation.

The research found that Tampa Bay has made no significant changes to its county-based transit agencies since they were established in the 1970s. At that time, the region was composed of the separate and distinct communities of Tampa, St. Petersburg and Clearwater, with just over 1 million residents. Today, the region has become single, multicounty urbanized area, and home to over 3 million residents.

Law said that by giving TBARTA a more focused mission to plan, implement and operate regional transit, it could create and manage the now-missing linkages between core business and residential centers that span county service areas.

Florida DEP issues Requests for Information re VW Settlement Fund

The Florida Department of Environmental Protection has filed a Request for Information (RFI) as part of its requirements to receive funding to mitigate the effects of diesel exhaust under the VW settlement. The money will be disbursed from the Mitigation Trust Fund as called for under the settlement.

The six RFI's were posted on the State's Vendor Bid System on May 12, 2017.

Interested parties can view and download the six separate RFIs from the State's Vendor Bid System website at http://www.myflorida.com/apps/vbs.

The Department said that the RFIs are for informational purposes only. Responding to one or more of these RFIs is not a prerequisite for and does not guarantee participation in any potential mitigation project or program.

The deadline to provide information is June 23, 2017.

Finally, the Department has established an email list for parties interested in following developments related to the State Mitigation Plan and future activity under the Mitigation Trust Fund.

House Hearing shows mixed support on Governor's Plan to have locals pay for State Police Protection

At a recent House Transportation Committee meeting, state lawmakers questioned administration officials over Governor Tom Wolf's plan to impose a $25-per-resident fee on municipalities that rely on the State Police for protection.

The top concern from lawmakers was that the fee would unfairly burden some rural communities that have only a minimal reliance on the State Police.

"I'm very skeptical of the proposal to pass that burden on to rural Pennsylvanians. Many people in my district are unable to afford a home because of other issues like property taxes. And asking them for a per-capita tax -- if you have three children, four children, five children, you're going to be paying even more," said Rep. Doyle Heffley (R- Carbon).

At the same time, other members, both Democratic and Republican, have voiced support for the plan in light of the State Police budget increases over the years and the strain its putting on the Motor License fund, which is now funding nearly two-thirds of the State Police budget. The growing State Police budget is in turn eating up funding for road and bridge repair, funding which increased significantly under Act 89 of 2013.

Last summer as part of approval of the FYI 2016-17 budget, state lawmakers did a approve a rule capping the PennDOT allocation for state police at FY 2016-17 levels, and mandating a four percent reduction each year until the cost is back down to $500 million.

"The idea is to free up roughly $2 billion over 10 years that could be redirected back to roads and bridges," said PennDOT spokesman Rich Kirkpatrick.

But the move potentially creates a shortfall for the State Police.

If that PennDOT gas money is not replaced, the State Police will lose $40 million next year, $105 million the following year and $294 million by 2021-22, according to a five-year economic forecast report done by the Independent Fiscal Office.

"The issue will come to a head in June as the General Assembly faces a June 30 deadline for approval of the 2017-18 spending plan," said Buchanan's Matt Fine – Advisor, Government Relations.

PennDOT 12-Year project prioritization reviewed by Senate Transportation Committee

Pennsylvania Transportation Secretary, Leslie Richards, recently told members of the Senate Transportation Committee that PennDOT's Twelve Year Program (TYP) is a multimodal, fiscally constrained program of transportation improvements.

"Multimodal means that the TYP includes all travel modes including highways, bridges, public transit, aviation, rail freight and bicycle and pedestrian facilities," she said.

Richards further said that there is a ten-step process in developing the TYP. As part of the process, the State Transportation Commission releases the Transportation Performance Report and solicits public input through online and in-person approaches. She added that the results of these public outreach efforts help guide the development of the TYP. She pointed out that in preparing the 2017 TYP over 5,300 customers completed surveys identifying 15,634 transportation issues.

In the second step of the process, the Planning Partners, including the Metropolitan and Rural Planning Organizations (MPO/RPOs), request input from local stakeholders and the public on transportation needs to identify projects that reflect community and regional goals. Richards said they share all the information gathered to help guide the update of their regional Transportation Improvement Program (TIP) for the first four years of the TYP.