OP-ED: Governors Hochul, Murphy and Lamont's agreement on federal funding allocations missing some critical details

The announcement by Governors Kathy Hochul (New York), Phil Murphy (New Jersey) and Ned Lamont (Connecticut) concerning an agreement on the sub allocations of federal emergency relief funding apportioned to the New York/North East New Jersey Urbanized Area by Congress to deal with COVID-19 related losses in transit system ridership and revenue missed some critical details.

Negotiations started in March 2021 with the states agreeing after nine months (far too long) that approximately $10.85 billion of the funding will be for New York, $2.66 billion will be for New Jersey and $474 million will be for Connecticut.

These funds come from the $900 billion Coronavirus Response and Relief Supplemental Appropriations Act of 2021 that was signed into law on Dec. 27, 2020, which allocated $14 billion for transit and the American Rescue Plan Act of 2021 that was signed into law on March 11, 2021, to provide $30.5 billion for transit. 

Using this new formula for allocation of funding to the New York/North East New Jersey Urbanized Area sets a precedent. It will be interesting to see when the Federal Transit Administration issues a future Federal Register Notice in coming weeks for allocation of fiscal year 2022 Section 5307 NY/Northeast NJ Urbanized Area funding. Will the New York Metropolitan Transportation Authority (MTA) agree with New Jersey Transit and return to using the traditional formula or will it insist on using this new formula?

I would point out that the Port Authority of New York and New Jersey (PANYNJ) PATH may be the losers. It is up to the Northeast New Jersey Metropolitan Planning Organization to divide up these funds between the voting members. This includes both New Jersey Transit and the PANYNY before the split on the New Jersey side of the river is final. For decades, I have found it strange that PANYNJ has not fought for its fair share on behalf of 284,000 pre COVID-19 average weekday riders who patronize the Port Authority Trans Hudson subway. This provides services between Hoboken, Newark and Journal Square in New Jersey with the World Trade Center and 33rd Street in midtown Manhattan.

Resolution is still needed for dividing up these funds for other non-MTA transit operators on the New York side of the Hudson River. Until New York and New Jersey agree on a split of funding, the New York Metropolitan Transportation Council (the FTA-sanctioned Metropolitan Planning Organization) is unable to complete its own respective split for its membership.

The result is that the New York City Department of Transportation Staten Island Ferry, Nassau Inter County Express Bus, City of Long Beach Bus, Suffolk County Transit Bus, Town of Huntington Area Rapid Transit Bus, Westchester Bee Line Bus, Putnam Area Rapid Transit Bus and Transport of Rockland County Bus are also unable to access their share of funding. These smaller non MTA agencies don't have the same ability to borrow money as the MTA does.

Just like both NJ Transit and MTA, since March 2021, they have all incurred a significant lose of fare box revenue, as well as additional operating and capital costs.

Grants sometimes take longer to approve during FTA's first financial quarter (Oct. 1, 2021 - Dec. 30, 2021) for federal fiscal year 2022. Transit agencies have to renew annual requirements needed for grant approval. They must submit a series of new 2022 Annual Certifications and Assurances. FTA issues a Federal Register Notice for this critical document. Historically, it has taken the MTA many weeks before it completes submittal of this document. Based upon my previous experience working at FTA, NJ Transit has a better track record than MTA in submittal of Annual Certification and Assurances, along with other new documents necessary for the FTA to approve and obligate funding under carryover or new 1st Quarter federal fiscal year grants. This delays the ability of the FTA to complete and approve any pending grant.

It is now too late for any of these grants to be approved before December at the earliest. Formal submission can only take place after the splits between the states are agreed upon. The FTA averages 36 days after a grant is formally submitted to approve and obligate funding. The FTA TrAMS system came back up in late October. Unless grants are submitted before mid November, they may not end up being approved until the end of December 2021.

Virtually every other Urbanized Area in the nation, including those that cross state boundaries, already agreed on splits between transit agencies months ago. Most transit agencies have already submitted grants for both the second and third round of emergency relief funds. Most already have approved grants from the FTA for the second round. Week after week, more are obtaining approved grants for the third round.

It hurts both New York and New Jersey, along with Connecticut in the continuing national competition for other FTA discretionary transit dollars when they could not agree on the first step in accessing emergency relief funding for all this time.

The FTA is unable to complete any review of proposed grant applications until all the splits become final.

It appears that NJ Transit can proceed with submittal of a grant application. The MTA needs agreement on the NY side of the river with all the non MTA transit operators before the numbers become final.

One factor FTA needs before a determination can be made is that the identified funding in any grant application is complete. At that point, FTA will give the transit agency the green light to formally submit the grant.

Usually, a transportation program specialist, planner, director - Office of Planning and Program Development, Civil Rights Officer and legal counsel all sign off their approval that the grantee has meet all the requirements under parts of the program they administer and are responsible for. The last action is for the regional administrator to sign off. At that point, there is an official offer of the grant to the transit agency. They now can accept the offer. Now, the grantee can begin drawing down funds for expenses.

It is very sad that all the transit agencies in question have to wait until December 2021 or January 2022 before being reimbursed for costs incurred going back to March 2021.

The lessons learned is that New York, New Jersey and Connecticut or NJ Transit and MTA need to learn how to get along.

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Larry Penner is a transportation advocate, historian and writer who previously worked for the Federal Transit Administration Region 2 New York Office. This included the development, review, approval and oversight for billions in capital projects and programs for the MTA, NYC Transit, Long Island Rail Road, Metro North Rail Road MTA Bus, New Jersey Transit along with 30 other transit agencies in NY & NJ.