CBO examines eliminating the Federal Transit Administration to reduce deficit

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A recent report by the Congressional Budget Office (CBO) examined options for reducing the federal deficit that included eliminating both the Federal Transit Administration (FTA) and federal funding for public transportation. Such a move would reduce federal spending by $87 billion over 10 years, the CBO said.

The CBO estimates FTA programs and administrative costs will be $15 billion annually from 2021 through 2028. One policy option CBO cited was to phase out the FTA after the Fixing America’s Surface Transportation Act expires in 2020 and to terminate the FTA after it completes all outstanding grants.

Public transit systems are generally either local or regional and should be financed by local or state governments, the CBO said.

Any move toward eliminating the FTA is strongly opposed by the American Public Transportation Association (APTA).

“The CBO proposals will negatively impact the American people, the communities they live in and the companies they work at,” APTA President and CEO Paul P. Skoutelas said. “This is a time when we should be significantly increasing investment in our public transit infrastructure.”

Eliminating federal funding for public transportation will make the United States less competitive while reducing job opportunities and mobility for Americans, Skoutelas said.

Many businesses want to be located near public transportation, and for every $1 invested in public transportation, $4 in economic returns is generated, APTA said.

CBO said it periodically issues a compendium of policy options for reducing the deficit covering a broad range of issues, as well as separate reports that include options for changing federal tax and spending policies in particular areas. For each option, CBO said it presents an estimate of its effects on the budget but makes no recommendations.